Q4 2021 Spok Holdings Inc Earnings Call
Greetings and welcome to the Spark Holdings, Inc, Q4, and fiscal year 2021 earnings and strategic plan announcement conference call. At this time all participants are in a listen only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference.
Speaker 1: and welcome
Speaker 1: All participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require op-
Please press star zero on your telephone keypad.
To remind you. This conference is being recorded I would now like to turn this conference over to your host MS. Lisa put you in the Investor Relations. Thank you Ma'am you may begin.
Speaker 2: Hello, everyone, and welcome to Spoke Holdings, Fourth Quarter Earnings and Strategic Plan Call. I'm joined by Vince Kelly, President and Chief Executive Officer, as well as Michael Wallace, Chief Financial Officer and Chief Operating Officer.
Hello, everyone and welcome to spoke Holdings' fourth quarter earnings and strategic plan call I'm joined by Vince Kelly, President and Chief Executive Officer, as well as Michael Wallace, Chief Financial Officer, and Chief operating Officer.
Speaker 2: I would like to remind everyone that today's conference call may include forward-looking statements that are subject to risks and uncertainties related to spoke's future financial and business performance.
Like to remind everyone that todays conference call May include forward looking statements that are subject to risks and uncertainties related to <unk> future financial and business performance.
Speaker 2: Such statements may include estimates of revenue, expenses, and income, as well as other predictive statements or plans, which are dependent upon future events or conditions.
Such statements May include estimates of revenue expenses and income as well as other predictive statements or plans, which are dependent upon future events or conditions.
Speaker 2: These statements represent the company's estimates only on the date of this conference call and are not intended to give any assurance as to the actual future results.
These statements represent the Companys estimates only on the date of this conference call and are not intended to give any assurance as to the actual future results.
Speaker 2: actual results could differ materially from those anticipated in these far-looking states.
Actual results could differ materially from those anticipated in these forward looking statements.
Speaker 2: Although these statements are based on assumptions that the company believes to be reasonable, they are subject to risks and uncertainty.
These statements are based on assumptions that the company believes to be reasonable they are subject to risks and uncertainties.
Speaker 2: Please review the risk factors section relating to our operations and the business environment in which we compete contained in our 2021 Form 10-K and related documents we expect to file with the Securities and Exchange Commission.
Please review the risk factors section relating to our operations and the business environment in which we compete contained in our 2021 Form 10-K and related documents, we expect to file with the Securities and Exchange Commission.
Speaker 2: Please note that SPOC assumes no obligation to update any forward-looking statements from past or present filings and conference calls. With that, I'll turn the call over to them.
Please note that spoke assumes no obligation to update any forward looking statements from past or present filings and conference calls with that I'll turn the call over to Don.
Speaker 3: Thank you. Let's turn to slide three and good morning everyone. Thanks for joining us for this important update. Today we will share with you how we plan to deliver significant shareholder value with our new strategic business plan.
Thank you, let's turn to slide three and good morning, everyone. Thanks for joining us for this important update today, we will share with you how we plan to deliver significant shareholder value with our new strategic business plan.
Speaker 3: As stated in our press release this morning, our plan will prioritize in maximizing free cash flow and returning capital to shareholders, while at the same time continuing to explore alternatives to our ongoing strategic review process.
Stated in our press release. This morning, our plan will prioritize maximizing free cash flow and returning capital to shareholders. While at the same time continuing to explore alternatives to our ongoing strategic review process I'll start by reviewing the agenda for today's call. The order will be as follows.
Speaker 3: I'll start by reviewing the agenda for today's call. The order will be as follows.
Speaker 3: We'll start with a high-level overview of our fiscal year 2021 results.
We will start with a high level overview of our fiscal year 2021 results next well review a summary of our new strategic business plan.
Speaker 3: Next, we'll review a summary of our new strategic business plan.
Speaker 3: This will include our capital allocation decisions and prioritization of returning capital to shareholders.
This will include our capital allocation decisions and prioritization of returning capital to shareholders.
Speaker 3: Then we'll cover our current outlook for 2022 and 2023. And finally, we'll conclude with a wrap up and Q&A session.
Lynn will cover our current outlook for 2022 and 2023.
And finally.
We will conclude with a wrap up the Q&A session.
Speaker 3: Turning to slide four, as mentioned, before we begin our discussion of the new strategic business plan for SPOC, I'd like to take a few minutes and provide a recap of our 2021 financial performance, which we reported earlier this morning. I encourage you to review our 10-K when filed, as it contains significantly more information about our business operations and financial performance than we will cover on this call.
Turning to slide four.
As mentioned before we begin our discussion of the new strategic business plan for spoke I'd like to take a few minutes and provide a recap of our 2021 financial performance, which we reported earlier this morning.
I encourage you to review our 10-K when filed as it contains significantly more information about our business operations and financial performance than we will cover on this call.
For fiscal year 2021 we achieved our previously communicated full year financial guidance for revenue adjust.
Speaker 3: For fiscal year 2021, we achieved our previously communicated full year financial guidance for revenue, adjusted operating expenses, and capital expenditures.
Adjusted operating expenses and capital expenditures.
Speaker 3: Total GAAP revenue for fiscal year 2021 was $142.2 million, consisting of wireless revenue of $78.8 million and software revenue of $63.3 million.
Total GAAP revenue for fiscal year, 2021 was $142 2 million consisting of wireless revenue.
$78 8 million in software revenue of $63 3 million.
Speaker 3: With respect to wireless revenue, 2021 performance was driven by a lower level of pager unit churn on a year-over-year basis. In fact, net pager churn decline during the year averaged 4.3%, another record low. As a result, wireless revenue for 2021 remains solid, declining only 5.7% compared to the prior year.
With respect to wireless revenue 2021 performance was driven by a lower level of pager unit churn on a year over year basis in fact, net pager churn.
Klein during the year averaged 4.3% another record low as a result wireless revenue for 2021 remains solid declining only five 7% compared to the prior year.
Speaker 3: These continued strong trends in our wireless business are being driven by the combination of solid gross additions from our sales organization, continued minimization of churn with existing customers, and stable unit prices.
These continued strong trends in our wireless business are being driven by the combination of solid gross additions from our sales organization continued minimization of churn with existing customers and stable unit pricing.
Speaker 3: Furthermore, in future periods, we expect our new Gen A pager, which was announced in November 2021, to be a significant factor in minimizing churn and maintaining average revenue per unit.
Furthermore, in future periods, we expect our new Gen. A pager, which was announced in November 2021 to be a significant factor in minimizing churn and maintaining average revenue per unit.
Speaker 3: For software revenue, 2021 performance of 63.3 million represented a 2% decrease from 2020.
For software revenue 2021 performance of $63 3 million represented a 2% decrease from 2020.
Speaker 3: given the slow adoption of SpokeGo due in part to the pandemic and its impact on our customers' resources.
Given the slow adoption of spoke go due in part to the pandemic and its impact on our customers' resources virtually all software revenue is related to our legacy care connect suite solutions our.
Speaker 3: Virtually all software revenue is related to our legacy CareConnect Suite solution.
Speaker 3: A relatively flat revenue performance in 2021 on a year-over-year basis resulted from a combination of several factors, including, number one,
A relatively flat revenue performance in 2021 on a year over year basis resulted from a combination of several factors, including number one.
Speaker 3: The fact that our focus had been on bringing SmokeGo to market, rather than our CareConnect suite solutions, and this is going to change going forward. Number two.
But our focus has been on bringing spoke go to market rather than our care connect suite solutions and this is going to change going forward number two.
Speaker 3: Hospital customers, our largest segment, have continued to struggle with significant burnout and resource constraints due to the pandemic.
Hospital customers, our largest segment have continued to struggle with significant burn out and resource constraints due to the pandemic.
Speaker 3: U.S. health care system has lost between one in five to one in six health care workers. Nursing staff have been significantly depleted. On average it takes four to five years to train a nurse.
S Health care system has lost between one five to one in six health care workers nursing staffs within significantly depleted on average it takes four to five years to train a nurse. We expect these resource constraints to last well into the future and while we've had success over the past year selling our care connect suite solutions, our ability to demonstrate.
Speaker 3: We expect these resource constraints to last well into the future, and while we've had success over the past year selling our CareConnect sweep solutions, our ability to demonstrate, sell, and install our completely new cloud-native clinical communication solutions, SpokeGo, was severely impacted.
<unk> sell and install a completely new cloud native clinical communication solution spoke go was severely impacted number three our software maintenance revenue is a critical source of our reoccurring revenue stream 2021 software maintenance revenue was 38 million versus $38 6 million.
Speaker 3: Number three, our software maintenance revenue is a critical source of our reoccurring revenue stream.
Speaker 3: 2021 software maintenance revenue was $38 million versus $38.6 million in 2020, or 1.6% lower.
In 2021, 6% lower.
Speaker 3: As we've discussed previously, maintenance revenue being flat, slightly down is in line with our expectations given gross churn and uplift levels remaining consistent with prior years combined with less net additions to bookings primarily due to our 2021 focus on SpokeGo versus our Care Connect suite.
As we've discussed previously maintenance revenue being flat to slightly down is in line with our expectations given gross churn and uplift levels remaining consistent with prior years combined with less net additions two bookings primarily due to our 2021 focus on spoke go versus our care connect suite.
Speaker 3: For the full year 2021, adjusted operating expenses, which excludes depreciation, amortization, accretion, goodwill, and capitalized software development impairment charges, and severance and restructuring charges, and includes capitalized software development costs totaled $154.3 million. Additionally, we incurred approximately $2 million in costs related to our strategic alternatives review process.
For the full year 2021 adjusted operating expenses, which excludes depreciation amortization accretion goodwill and capitalized software development impairment charges and severance and restructuring charges and includes capitalized software development cost totaled 154.
$4 3 million. Additionally.
Additionally, we incurred approximately $2 million in costs related to our strategic alternatives review process.
Speaker 3: Expense management going forward will be a major focus as we align expense levels with market demand for our products. In 2021, both operating expenses and adjusted operating expenses were up from the prior year levels. However, the year-over-year comparisons are difficult given the timing of furloughs, CARES Act reimbursement, costs related to our strategic alternatives review process, and other costs.
Expense management going forward will be a major focus as we align expense levels with market demand for our products in 2021, both operating expenses and adjusted operating expenses were up from the prior year levels. However, the year over year comparisons are difficult given the timing of furloughs.
Ours Act reimbursement costs related to our strategic alternatives review process and other costs.
Speaker 3: Despite this, for 2021, we reported adjusted operating expenses of $154.3 million, up from $147.3 million in the same period a year ago.
Despite this for 2021 we reported adjusted operating expenses of $154 3 million up from $147 3 million in the same period a year ago.
Speaker 3: Adjusted operating expenses were higher largely as a result of the following three items.
Adjusted operating expenses were higher largely as a result of the following three items one.
Speaker 3: We incurred approximately $3.8 million of higher payroll and related costs in 2021 as compared to the same period a year ago. Employees incurred two weeks of furlough last year as opposed to five in 2020.
We incurred approximately $3 8 million of higher payroll and related costs in 2021 as compared to the same period, a year ago employees incurred two weeks of furlough last year as opposed to five in 2020.
Speaker 3: We also experienced increased health care costs as many individuals delayed wellness visits and medical procedures with lockdowns in place during 2020.
We also experienced increased health care costs for many individuals delayed wellness visits and medical procedures with Lockdowns in place during 2020.
Speaker 3: Our average employee compensation costs increase, particularly for software engineering talent. The healthcare technology market continues to see low unemployment, as well as tougher competition for employee recruiting and retention, combined with the market's adoption of a remote working environment.
Our average employee compensation cost increase, particularly for software engineering talent health care technology market continues to see low unemployment as well as tougher competition for employee recruiting and retention combined with the market's adoption of a remote working environment.
Speaker 3: This has broadened the reach of many larger companies with which we compete for talent.
This is broaden the reach of many larger companies with which we compete for talent.
Number two.
Speaker 3: 2020 included approximately $1.3 million of one-time savings related to refundable tax credits for employee retention taken under the CARES Act. And number three, as mentioned previously, we incurred approximately $2 million in costs related to our strategic alternatives review process. Each of the items described above, with the exception of the $2 million in process costs, were reflected in our financial guidance.
2020 included approximately $1 3 million of onetime savings related to refundable tax credits for employee retention taken under the cares Act and number three is.
<unk> mentioned previously we incurred approximately $2 million in costs related to our strategic alternatives review process. Each of the items described above it with the exception of the 2 million of process costs were reflected in our financial guidance.
Speaker 3: Additionally, in the fourth quarter of 2021, we recorded an impairment charge of $15.7 million related to capitalized research and development costs associated with SpokeGo.
Additionally, in the fourth quarter of 2021 we recorded an impairment charge of $15 7 million related to capitalized research and development cost associated with spoke out.
Speaker 3: Finally, our balance sheet remains strong with a cash, cash equivalents, and short-term investment balance of $59.6 million as December 31, 2021. We continue to operate as a debt-free company.
Finally, our balance sheet remains strong with a cash cash equivalents and short term investment balance of $59 6 million as December 31, 2021, we.
We continue to operate as a debt free company.
Speaker 3: Turn to slide five, and I'd like to now provide an update on our previously announced strategic review process.
Let's turn to slide five now.
And I'd like to now provide an update on our previously announced strategic review process.
Speaker 3: As you'll recall, the process commenced last year whereby the board, in partnership with management and our financial and legal advisors, began evaluating alternatives to maximize shareholder value.
As Youll recall the process commenced last year, whereby the board in partnership with management, and our financial and legal advisors began evaluating alternatives to maximize shareholder value.
Speaker 3: After a comprehensive and rigorous process, the company today is announcing a new strategic business plan, one that prioritizes maximizing cash flow over the long term and returning capital to shareholders.
After a comprehensive and rigorous process. The company today is announcing a new strategic business plan, one that prioritizes maximizing cash flow over the long term and returning capital to shareholders.
Speaker 3: Consistent with our announcement this morning, our board of directors has unanimously approved this business plan, which we will begin to implement immediately.
Consistent with our announcement this morning, our board of Directors has unanimously approved this business plan, which we will begin to implement immediately.
Speaker 3: The plan includes maximizing revenue and cash flow generation from our established Spoke Care Connect suite, including Spoke Mobile, and our wireless service offering.
The plan includes maximizing revenue and cash flow generation from our established spoke care connect suite, including spoke mobile and our wireless service offerings. As a reminder, our company has an excellent track record of driving revenue from these business lines and enjoys a significant market leadership position in narrow band personal.
Speaker 3: As a reminder, our company has an excellent track record of driving revenue from these business lines and enjoys a significant market leadership position in narrowband personal communication services, i.e. paging, and hospital call center solutions.
<unk> services I E Paging and hospital call Center solutions.
Speaker 3: Additionally, we plan to invest in a targeted and limited manner in these important and valuable franchises in order to continue our longstanding relationships with the nation's leading health care providers.
Additionally, we plan to invest in a targeted and limited manner and these important and valuable franchises in order to continue our long standing relationships with the nation's leading health care providers.
Speaker 3: While this has been a difficult decision, the company will be discontinuing SpokeGo and intends to eliminate all associated costs. Ultimately, the ongoing challenge of the COVID-19 pandemic has made it untenable for the platform to gain significant traction with customers or for our business to continue operating with our current levels of costs and personnel.
While this has been a difficult decision the company will be discontinuing spokeo and intense to eliminate all associated costs ultimately the ongoing challenge of the COVID-19 pandemic has made it untenable for the platform to gain significant traction with customers or for our business to continue operating.
With our current levels of costs and personnel.
Speaker 3: Given the environment in which we operate with respect to both the health of our customer base and the challenges in software engineering talent retention and acquisition, we believe this is the best path forward for Spoke and our shareholders.
Given the environment in which we operate with respect to both the health of our customer base and the challenges in software engineering talent retention and acquisition. We believe this is the best path forward for spoke and our shareholders with that being said, we will continue to work closely with existing spoke go customers to ensure that this transition.
Speaker 3: With that being said, we will continue to work closely with existing Spokgo customers to ensure that this transition is as smooth as possible.
As a smooth as possible.
Our new strategic business plan also includes expanding on the company's already disciplined expense management by streamlining our management structure rationalizing external cost reducing capital expenditures and consolidating offices.
Speaker 3: Our new strategic business plan also includes expanding on the company's already-disciplined expense management by streamlining our management structure, rationalizing external costs, reducing capital expenditures, and consolidating office
Speaker 3: Proceeding down this course involves some very hard decisions.
Proceeding down this course involves some very hard decisions, we will be trimming our management team by roughly one half and we'll be reducing our workforce by approximately one third over the course of the next 60 days.
Speaker 3: We will be trimming our management team by roughly one half, and we'll be reducing our workforce by approximately one third over the course of the next 60 days.
Speaker 3: We are not taking these steps lightly. However, after careful deliberation and given the challenges that we have talked about, we believe this is the right decision.
We are not taking these steps lightly however, after careful deliberation.
Given the challenges that we've talked about we believe this is the right decision.
Speaker 3: I'd also like to note that our review of strategic alternatives remains ongoing. While this process has not yet resulted in a transaction, the Board remains open to all potential alternatives to maximize value.
I'd also like to note that our review of strategic alternatives remains ongoing.
This process has not yet resulted in a transaction the board remains open to all potential alternatives to maximize value.
Let's look at slide six.
Speaker 3: Turning now to the company's plans to prioritize returning capital to our shareholders.
Turning now to the company's plans to privatize prioritize returning capital to our shareholders.
Speaker 3: Spoke will be increasing our regular quarterly dividend by 150%.
Both will be increasing our regular quarterly dividend by 150% from 12, and a half cents per share or 50 cents annually to 31, and a quarter cents per share or a dollar twenty-five annually. This increased dividend was approved by our board and our quarterly dividend was declared with a record date of March 16th.
Speaker 3: 12.5 cents per share, or 50 cents annually, to 31.25 cents per share, or $1.25 annually.
Speaker 3: This increased dividend was approved by our board and a quarterly dividend was declared with a record date of March 16, 2022 and a payment date of March 30, 2022.
2022, and a payment date of March 30th 2022.
Speaker 3: Based on our new business plan and our view of the future, we believe we can continue to pay this level of dividend for the foreseeable future and expect to be able to fund the majority of it from cash flow from operations in 2023 and beyond. This new level of dividend represents a significant and recurring yield on spoke shares going forward.
Based on our new business plan and our view of the future. We believe we can continue to pay this level of dividend for the foreseeable future and expect to be able to fund the majority of it from cash flow from operations in 2023 and beyond.
This new level of dividend represents a significant and recurring yield on spoke shares going forward.
Speaker 3: As always, the declaration and payment of future dividends is subject to the board's discretion and will depend on financial and legal requirements and other considerations.
As always the declaration and payment of future dividends are subject to the board's discretion and will depend on financial and legal requirements and other considerations.
Speaker 3: Additionally, the board has also authorized a share repurchase program of up to $10 million of the company's common stock. This authorization allows the company to return capital to shareholders by opportunistically repurchasing the company's shares. We'll continue to evaluate opportunities to repurchase shares that spoke transitions throughout our strategic pivot underway during 2022.
Additionally, the board has also authorized a share repurchase program of up to $10 million of the company's common stock. This authorization allows the company to return capital to shareholders by Opportunistically repurchasing the company's shares will continue to evaluate opportunities to repurchase shares spoke transitions.
Our strategic pivot underway during 2022.
And finally on this subject.
Speaker 3: We'll continue to evaluate our capital allocation strategy with the goal of maximizing shareholder value while continuing to provide critical communication services to our very important healthcare communications customers.
We will continue to evaluate our capital allocation strategy with the goal of maximizing shareholder value, while continuing to provide critical communication services to our very important health care communications customers.
Speaker 3: I'll now turn the call over to Michael Wallace, our Chief Financial Officer and Chief Operating Officer, who will review our financial outlook for 2022 and 2023.
I'll now turn the call over to Michael Wallace, Our Chief Financial Officer, and Chief Operating Officer, who will review our financial outlook for 2022 and 2023.
Nick.
Speaker 4: Thanks, Vince. And good morning, everyone. I'm turning to slide seven. So as Vince went through our 2021 results and took you through the strategic pivot that we are embarking on today, I would like to take some time to give you our thoughts for the balance of this year and looking into 2023.
Thanks, Vince and good morning, everyone.
Turning to slide seven so as Vince went through our 2021 results and took you through the strategic pivot that we are embarking on today I would like to take some time to give you our thoughts for the balance of this year and looking into 2023.
Speaker 4: And before getting into specifics, I think it is important to highlight for everyone that fiscal year 2022 will be a transition year for SPOC, given the implementation time required to execute our strategic shift to a cash flow model. However, we do anticipate that this transition will be completed by the end of 2022.
And before getting into specifics I think it is important to highlight for everyone that fiscal year 2022 will be a transition year for spoke given the implement implementation time required to execute our strategic shift to our cash flow model. However.
However, we do anticipate that this transition will be completed by the end of 2022.
Speaker 4: So turning to our guidance for 2022, and be reminded the figures I am going to discuss today are included in our guidance table in the earnings release.
So turning to our guidance for 2022 and be reminded the figures I am going to discuss today are included in our guidance table in the earnings release.
Speaker 4: We expect total revenue to be in the range of $126 million to $139.2 million of which we expect wireless revenue to range between $71.6 million to $77 million, where the midpoint reflects an annual revenue attrition rate of approximately 5.7% when compared to 2021 and is consistent with our recent trend.
We expect total revenue to be in the range of $126 million to $139 2 million of which we expect wireless revenue to range between $71 6 million to $77 million, where the mid point reflects an annual revenue attrition rate of approximately five 7% when compared to two.
2021, and is consistent with our recent trends.
Speaker 4: Software revenue is expected to range from $54.4 million to $62.2 million, where the midpoint reflects annual revenue attrition of approximately $5 million from 2008.
Software revenue is expected to range from $54 4 million to $62 2 million, where the mid point reflects annual revenue attrition of approximately $5 million from 2021.
Given that it is important to understand where this decrease in total software revenue from 2021 is coming from and why.
Speaker 4: Given that, it is important to understand where this decrease in total software revenue from 2021 is coming from and why.
Speaker 4: First, we have assumed an intentional reduction in services revenue to better align with our current backlog and to drive a higher rate of net cash flow in alignment with the shift in our strategic business plan that Vince previously mentioned.
First we have assumed an intentional reduction in services revenue to better align with our current backlog and to drive a higher rate of net cash flow and alignment with the shift in our strategic business plan that Vince mentioned previously mentioned.
Speaker 4: Services has not historically driven meaningful cash flow on a stand-alone basis.
Services has not historically driven meaningful cash flow on a standalone basis, but has been that has been viewed as an opportunity to expand our licensed footprint through customer engagement as well as to fulfill upgrade obligations under our maintenance contracts, which is to which is critical to maintaining our existing customers.
Speaker 4: but has been viewed as an opportunity to expand our license footprint through customer engagement as well as to fulfill upgrade obligations under our maintenance contracts, which is critical to maintaining our existing customer engagement.
Speaker 4: Second, an anticipated low point in Care Connect suite bookings in 2022, which will impact license and equipment revenue.
Second an anticipated low point and care connect suite bookings in 2022, which will impact license and equipment revenue, which typically has revenue recognition immediately as we focus solely on care connect suite across the organization and bolster our care connect suite product line through directed R&D spend.
Speaker 4: which typically has revenue recognition immediately, as we focus solely on CareConnect Suite across the organization and bolster our CareConnect Suite product line through directed R&D strategies.
Speaker 4: at levels consistent with previous years in the $7 million to $9 million range annually without the dilutive effects from SpokeGo initiatives.
At levels consistent with previous years in the 7 million to $9 million range annually without the dilutive effects from spoke go initiatives.
And third for maintenance revenue to contract by approximately 3% on a year over year basis, primarily due to the lower net additions provided by bookings in 2022 that I just discussed as we expect customer churn and annual uplift rates to remain consistent with past years.
Speaker 4: And third, for maintenance revenue to contract by approximately 3% on a year-over-year basis.
Speaker 4: Primarily due to the lower net additions provided by bookings in 2022 that I just discussed, as we expect customer churn and annual uplift rates to remain consistent with past years.
Turning to adjusted operating expenses, we expected we expect adjusted operating expenses for the full year of 2022 to be in the range of $118 8 million to $128 6 million.
Speaker 4: We expect adjusted operating expenses for the full year of 2022.
Speaker 4: to be in the range of $118.8 million to $128.6 million.
Speaker 4: As noted in our earnings release, adjusted operating expenses exclude severance, restructuring costs, depreciation, amortization, and accretion.
As noted in our earnings release, adjusted operating expenses exclude severance and restructuring cost depreciation amortization and accretion and.
Speaker 4: And regarding the one-time costs, I will speak to those specific costs on the next slide.
And regarding the onetime costs I will speak to those specific costs on the next slide.
But first as it relates to adjusted operating expenses the reduction from the $154 3 million in 2021 to the 2022 midpoint of $123 7 million or approximately $30 million lower is as follows.
Speaker 4: The reduction from the $154.3 million in 2021 to the 2022 midpoint of $123.7 million, or approximately $30 million lower, is as follows.
Speaker 4: First, the majority will come from the lower personnel costs related to approximately 175 fewer full-time employees in the organization for most of the final three quarters.
First the majority will come from the lower personnel costs related to approximately 175 fewer full time employees in the organization for most of the final three quarters of 2022.
Speaker 4: Second, lower costs related to outside services, office leases, and other expenses, the majority of which were tied directly or tangentially to spoke.
Lower costs related to outside services office leases and other expenses, the majority of which were tied directly or tangentially to spoke out.
Speaker 4: And third, our expectation of not having the same level of strategic alternative review process costs as we're
And third our expectation of not having the same level of strategic alternative review process costs as were incurred in 2021.
Yeah.
Speaker 4: Moving on to capital expenditures, we expect that CapEx will be in the range of $3.4 million to $4.2 million, as the majority of CapEx is related to our wireless business, which is unchanged. Moving to slide 8. As we facilitate our industry...
Moving on to capital expenditures, we expect that Capex will be in the range of $3 4 million to $4 2 million as the majority of Capex is related to our wireless business, which is unchanged.
Moving to slide eight.
As we facilitate our new strategic business plan, we will incur specific onetime restructuring costs as.
Speaker 4: As Vince mentioned earlier, we are trimming approximately one-half of our management team and reducing the total employee headcount by approximately one-third. And this of course is driving the majority
As Vince mentioned earlier, we are trimming approximately one half of our management team and reducing the total employee head count by approximately one third.
And this of course is driving the majority of our cost savings in this plan.
Speaker 4: As a result of these reductions in employee levels, we have estimated severance, retention, and associated personnel costs will be between $5 million and $6.6 million and will be fully incurred in 2020.
As a result of these reductions employee levels, we have estimated severance retention and associated personnel costs will be between 5 million and $6 6 million and will be fully incurred in 2022.
Speaker 4: With the discontinuation of Spoke-Go, the company will also incur contractual terminations and
With the discontinuation of spoke go the company will also incur contractual terminations and exit costs. We will immediately began the process of working with our spoke go customers to ensure that the termination of services is executed as smoothly as possible.
Speaker 4: We will immediately begin the process of working with our Spokgo customers to ensure that the termination of services is executed as smoothly as possible.
Speaker 4: As a result, we estimate that the contractual terminations in exit
As a result, we estimate that the contractual termination and exit costs related to spokeo for both customers and vendors will be between $1 4 million to $3 6 million.
Speaker 4: Related to smoko for both customers and vendors will be between 1.4 million to 3
Speaker 4: Therefore, in total, we are estimating that one-time restructuring costs related to the new business plan will range from $6.4 million to $10.2 million.
Therefore in total we are estimating that one time restructuring cost related to the new business plan will range from $6 4 million to $10 2 million.
So moving to slide nine now.
Speaker 4: Now, historically, as a company, we do not provide guidance past one year, but given the uniqueness of the situation for Spoke, I want to share some of our thoughts as we look at the company's preliminary 2023
Now historically as a company, we do not provide guidance past one year, but given the uniqueness of the situation for spoke I wanted to share some of our thoughts as we look at the company's preliminary 2023 outlook.
Speaker 4: So to be clear, this is not guidance, but rather our current thinking on 2000.
So to be clear this is not guidance, but rather our current thinking on 2023.
Speaker 4: As I mentioned earlier, fiscal year 2022 is going to be a transition year for the company as we implement our
As I mentioned earlier fiscal year 2022 is going to be a transition year for the company as we implement our new strategic business plan.
Speaker 4: With that being said, we expect that the company will be cash flow positive by the third quarter of 2022 and to reach the full cash flow run rate by the end of 2022 as we head into 2020.
With that being said, we expect that the company will be cash flow positive by the third quarter of 2022 and to reach the full cash flow run rate by the end of 2022 as we head into 2023.
Speaker 4: As for revenue streams, we expect that wireless revenue will continue along current trend levels and have the hope that the addition of our Gen A pager, as Vince discussed earlier, will benefit attrition rates and average revenue.
As for revenue streams, we expect that wireless revenue will continue along current trend level trend levels and have the hope that the addition of our Gen. A pager as Vince discussed earlier will benefit attrition rates and average revenue per unit.
Speaker 4: For software revenue, we believe we will begin to stabilize throughout 2022 and 2023 as the company refocuses its sole development efforts on the establishment of new software.
For software revenue, we believe we will begin to stabilize throughout 2022 and 2023 as the company refocus as its sole development efforts on the established spoke care connect suite.
Upon the execution of the pivot of the strategic plan, we expect annualized cost savings to be between 43 to $44 3 billion on a pro forma basis, when compared to annualized adjusted operating expenses incurred in the fourth quarter of 2021 less the approximately.
Speaker 4: Upon the execution of the pivot of the strategic plan, we expect annualized cost savings to be between $40.3 to $44.3 billion.
Speaker 4: compared to annualized adjusted operating expenses incurred in the fourth quarter of 2021, less than approximately $1 million of processing costs.
$1 million of process related costs.
Speaker 4: Finally, regarding the $1.25 set annual dividend.
Finally regarding the $1 25 set annual dividend level based on current expectations. We believe we will be able to fund the majority of this dividend through cash flow from operations.
Speaker 4: Based on current expectations, we believe we will be able to fund the majority of this dividend through cash flow from operations.
Speaker 4: Given the strategic shift, the board and management believe it is imperative to return our operating cash flow to shareholders and to reduce our existing cash balances in a manner which provides both flexibility during this transition as well as for opportunistic share repurchases as Vince mentioned.
Given the strategic shift the board and management believe it is imperative to return our operating cash flow to shareholders and to reduce our existing cash balances in a manner, which provides both flexibility during this transition as well as for operating this opportunistic share repurchases as Vince mentioned earlier.
Speaker 4: And lastly, as we adopt the plan we have outlined today, it is important to remind investors of the significant deferred tax assets the company has to mitigate federal income tax liability.
And lastly, as we adopt the plan we have outlined today. It is important to remind investors of the significant deferred tax assets. The company has to mitigate federal income tax liabilities going forward.
So as we move through this transition we will continue to up shareholder update shareholders of our progress also the board along with its capital allocation Committee will continue to assess the best way to drive shareholder value from a capital allocation standpoint.
Speaker 4: So as we move through this transition, we will continue to update shareholders of our program.
Speaker 4: Also, the Board, along with its Capital Allocation Committee, will continue to assess the best way to drive shareholder value from a capital allocation.
Speaker 4: With that, I'll turn the call back over to Vince for some closing comments before we open the call.
With that I'll turn the call back over to Vince for some closing comments before we open the call up to Q&A. The slide 10, and thank you Mike before we open the call up for questions I'd like to comment briefly on our business as we move forward. This slide provides an excellent visual of the quality of our health care provider customers, which includes some of the top half.
Speaker 3: Before we open the call up for questions, I'd like to comment briefly on our business as we move forward. This slide provides an excellent visual of the quality of our healthcare provider customers, which includes some of the top hospitals in the country.
Whittles in the country for the ninth consecutive year spoke has partnered with all 20 of the best adult hospitals and in eight of the past nine years. The company has also provided solutions to all the best children's hospitals. All these hospital systems rely on spoke to solve complex health care communications challenges and.
Speaker 3: For the ninth consecutive year, Smoke has partnered with all 20 of the best adult hospitals, and in eight of the past nine years, the company has also provided solutions to all the best children's hospitals. All these hospital systems rely on Smoke to solve complex healthcare communications challenges and provide secure and reliable care team communications, which has been especially important with the rise of COVID-19 variants.
Secure and reliable care team communications, which has been especially important with the rise of COVID-19 variance.
Speaker 3: We look forward to continuing to provide outstanding support to our customers as we make our business transition.
We look forward to continuing to provide outstanding support to our customers as we make our business transition.
Turning to slide 11, I'd like to wrap up with a quick recap of our business for starters. We continue to remain committed to our mission to be a strategic partner of choice for enterprise grade communications and patient care coordination.
Speaker 3: Turning to slide 11, I'd like to wrap up with a quick recap of our business. For starters, we continue to remain committed to our mission to be a strategic partner of choice for enterprise-grade communications and patient care coordination. This commitment has allowed Spoke to create a significant market position with longstanding relationships with the nation's leading healthcare providers.
This commitment has allowed spoke to create a significant market position with long standing relationships with the nation's leading health care providers spoke is a best in class Paging network currently the largest in the United States, which continues to generate strong results and we now have a new exclusive alphanumeric messaging device and.
Speaker 3: spoke as a best-in-class paging network, currently the largest in the United States, which continues to generate strong results. And we now have a new, exclusive, alphanumeric messaging device in our Gen A product.
Our G&A product. Additionally spoke continues to provide a valuable and critical service to our customers, it's delivering important information to care teams, winning where it matters the most to improve patient outcomes.
Speaker 3: Additionally, Spoke continues to provide a valuable and critical service to our customers, delivering important information to care teams when and where it matters the most to improve patient outcomes.
Speaker 3: As previously discussed, our Spoke Care Connect solutions provide a suite of products with potential for new license sales and a valuable maintenance stream.
As previously discussed our spoke care connect solutions provide a suite of products with the potential for new license sales and a valuable maintenance stream.
Speaker 3: Maintenance continues to provide a foundation under our legacy software business and is important to maintain as we quickly transition to focus on cash flow generation.
Maintenance continues to provide a foundation under a legacy software business and is important to maintain as we quickly transitioned to focus on cash flow generation.
Speaker 3: Finally, I'd like to close by reminding you, Spoke continues to demonstrate a very predictable revenue base, with over 80% of our revenue being recurring in nature, coming from either our legacy wireless offerings or software maintenance contracts.
Finally, I'd like to close by reminding you spoke continues to demonstrate a very predictable revenue base with over 80% of our revenue being recurring in nature coming from either our legacy wireless offerings are software maintenance contracts.
Speaker 3: At this point, I'll ask the operator to open the line for questions. Operator? Operator, at this time, we will close the line.
At this point I'll ask the operator to open the line for questions operator.
At this time, we'll be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad, a confirmation tone will indicate your line is in the question queue. You May Press Star two Jim move your question from the queue for participants using speaker equipment it may be necessary.
Speaker 1: If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation symbol will indicate your line is in the question queue. You may press star 2 to remove your question from the queue. For participants using speaker equipment, it may be necessary for you to pick up your handset before pressing the star keys. One moment. While we wait…
To pick up your handset before pressing the star key one moment, while we poll for questions.
Speaker 1: Our first question comes from the line of Amelia Roberts with ODEON, you may proceed with your question. Hi there, thank you.
Our first question comes from the line of Amelia Roberts with Odeon You May proceed with your question.
Hi, there. Thank you for holding today's call and taking my question. When you rejected the top dollar off Roma.
Speaker 1: When you rejected the $12 offer almost two years ago, you said that it was not the right time due to disruptions in the debt and equity markets, but also indicated the very recent launch of Spoko and its broad market potential for critical in-hospital communications as a growth driver for future company performance, but now you are announcing that you are not going to be able to do that. So, I'm just wondering if you could elaborate a little bit on that.
You said that it was not the right time due to disruptions in the debt and equity markets, but also indicated the very recent launches socal and its broad market potential for credit card and hospital communications as a growth driver for future company performance.
But now you are announcing that you will disconnect discontinue said, though what do you now consider think grubbs driver for future company performance and when will we start to see year over year revenue growth.
Speaker 1: What do you now consider the growth driver for future company performance? And where will we start to see year-over-year revenue growth?
Speaker 3: Thank you very much for your question. First of all, we are giving guidance today that doesn't suggest revenue growth for 2022.
Thank you very much for your question.
First of all we are giving guidance today that doesn't suggest revenue growth.
For 2022, we are very focused on our wireless business, but that is still a trading, albeit it treats a little bit more slowly every year going forward and our software business has been relatively flat there is opportunity for revenue growth that would be on the software business side last year, our revenue eroded 2%.
Speaker 3: We are very focused on our wireless business, but that is still a treading, albeit it treads a little bit more slowly every year going forward. And our software business has been relatively flat. There's opportunity for revenue growth that would be on the software business side. Last year, our revenue eroded 2% roughly from 2020 levels. And going forward.
Roughly.
From 2020 levels and going forward.
Speaker 3: we expect it to be relatively flat, but there could also be opportunity there because our Care Connect suite.
We expect it to be relatively flat, but there could also be opportunity there because our care connect suite, which is our hospital contact center solutions, primarily has not been our primary focus over these last couple of years, we havent put a ton of effort into it we are the.
Speaker 3: which is our hospital contact center solutions primarily, has not been our primary focus over these last couple years. We haven't put a ton of effort into it. We are the industry leader in that market. And so I think if anywhere in our business there's opportunity for growth, it's going to be there. But we're not forecasting that in our guidance today.
Industry leader in that market and so I think if any where in our business. There is opportunity for growth, it's going to be there, but we're not forecasting that in our guidance today.
Speaker 1: Okay, great. Thank you. And just to follow up with that, why would the board.
Okay, great. Thank you and just a follow up.
Why would the board agreed to make significant changes to dividends and extend employment agreement.
Speaker 1: changes to dividends and extend employment agreements while still undergoing discussions with bidders for the
I'll still undergoing discussions with bidders for the company and why with the changes announced today.
Speaker 1: And why would the changes announced today not reduce the chances of other bidders having interest in the company?
Not reduce the chances of other better having interest in the company.
Well I think the board is.
Speaker 3: importantly focused on the future. And while the process absolutely remains open and the board is open minded to all potential alternatives to maximize value, we still have a business to run in order to get there. And it's important to make this pivot because the outlook for spoke go in this environment with all the pressure that these hospitals have had on their resources.
Importantly focused on the future and while the process absolutely remains open and the board is open minded to all potential alternatives to maximize value. We still have a business to run in order to get there and it's important to make this pivot because the outlook for spoke go in this environment with all the pressure that these hospitals have.
Had on their resources.
Speaker 3: uh... we have found is a very difficult we would have to continue spending at a very high level and hope of the next couple years that things got better in the health care environment and when we look around and we talked to cio's and we see what's going on with their resources and how long we think it'll take them to recover we didn't think continue to spend twenty million dollars a year in our indian spoke out going forward in the hopes that we would get
We have found is a very difficult we would have to continue spending at a very high level and hope over the next couple of years that things got better in the health care environment and when we look around and we talked a cio's and we see what's going on with their resources and how long we think it will take them to recover we didn't think continuing to spend $20 million a year in R&D on spoke go going forward.
In the hopes that we would get.
Speaker 3: two, five, ten million dollars of revenue out of it on an annual basis was a good trade. So we made a very difficult decision. As I said in my comments earlier, we did not take this decision lightly. We have an awful lot of good people that worked very, very hard to make this thing successful. It just didn't happen. And so we're left with a very tough slate of choices.
Two $5 million to $10 million of revenue out of it on an annual basis was a good trade. So we made a very difficult decision as I said in my comments earlier, we did not take this decision lightly we have an awful lot of good people that worked very very hard to make this thing successful. It just didn't happen and so we're left with is very tough.
Slate of choices the board made the choices, we're moving forward and we're going to do our absolute best to generate as much cash as we can and we're going to return that capital to our shareholders and when we look at our business plan, even with these what we think are conservative outlook. We can pay this level of dividend for a very very long time, and we can fund most of.
Speaker 3: The board made the choices, we're moving forward, and we're going to do our absolute best to generate as much cash as we can, and we're going to return that capital to our shareholders.
Speaker 3: And when we look at our business plan, even with these what we think are conservative outlook, we can pay this level of dividend for a very, very long time and we can fund most of it.
Through our free cash flow and so that's what our focus is going to be going forward and we think that's going to be a very nice yield and we think returning capital to shareholders in this environment and given all the things that are happening given the challenges that we've had with recruiting and retention for engineering challenge talent given the challenges that we're seeing with respect to M&A going on.
Speaker 3: through our free cash flow and so that's what our focus is going to be going forward and now we think it's going to be a very nice
Speaker 3: And we think we turn a capital to shareholders in this environment, given all the things that are happening.
Speaker 3: Given the challenges that we've had with recruiting and retention for engineering talent, given the challenges that we're seeing with respect to M&A going on in the sector and very large
In this sector and very large competitors moving in you've seen Oracle acquire Cerner you saw striker acquire both Sarah right. After Vocera acquired patient safety saw a while ago Hill ROM acquire bolt who was a competitor of ours only later for Hill ROM to get acquired by Baxter very large play.
Speaker 3: competitors moving in, you know, you've seen Oracle.
Speaker 3: Acquire Cerner, you saw Stryker, Acquire Vocera, right after Vocera, Acquire PatientSafe, you saw
Speaker 3: A while ago, Hill-Rom acquired Volt, who was a competitor of ours, only later for Hill-Rom to get acquired by Baxter. Very large players moving into that clinical communication space. All these were factors in our decision to make the changes that we made, and we think going forward, running the company for cash flow, returning that cash to our shareholders.
Here's moving into that clinical communications space. All of these were factors in our decision to make the changes that we made and we think going forward running the company for cash flow returning that cash to our shareholders during selective share repurchases, while keeping a completely open mind to other alternatives to maximize shareholder value.
Speaker 3: doing selective share repurchases while keeping a completely open mind to other alternatives to maximize shareholder value is the right business plan at this point.
Is the right business plan at this point.
Okay, great. Thank you.
Speaker 1: Our next question comes from the line of Jason Kraft, private investor. You may proceed with...
Our next question comes from the line of Jason Private Investor You May proceed with your question.
Speaker 5: Hey, it's Jason Kraft with High Cliff Capital. I've got a few questions.
Hey, it's Jason Kraft with high Cliff capital I got a few questions.
Speaker 6: So, now that board and management have come to terms with running the two business segments for cash, you've given some outlook in the guidance.
So now at board and management have come to terms with.
Running the.
The two business segments for cash.
You've given some outlook in the guidance, but.
Let's get some color on just where you think the free cash flow margins of both segments.
Speaker 6: look like say on a run rate end of the year or next year and you've given the guidance on some of the costs and revenue but let's let's talk about what really matters to cash flow. So what are the free cash flow margin expectations?
Could look like say on a run rate end of the year next year and you've given the guidance on some of the costs and revenue, but let's talk about what really matters to cashless and what are the free cash flow margin expectations on both segments.
Speaker 3: Yeah, we didn't provide guidance on free cash flow margin expectations. We said we'd cover the majority of the dividend through free cash flow next year and going forward, and that's all the guidance we're going to give regarding that today. We'll take a look in the future if we want to give additional guidance around that, but not today. But Vince, I mean, we're in a.
Yeah, we didn't provide guidance on free cash flow margin expectations. We said, we would cover the majority of the dividend to free cash flow next year and going forward and Thats. All the guidance were going to give regarding that today, we'll take a look in the future. If we wanted to give additional guidance around that but not today.
But.
Vince I mean, we're in.
We're in a different.
Mode here, where you guys.
Just to be blunt.
Speaker 6: We hear a lot about maximizing share over value, maximizing pre-cash flow. There really is no, there really hasn't been a track record in that. And the board as well as.
We hear a lot about maximizing shareholder value maximizing free cash flow.
There really is no there really hasn't been a track record of that and the board as well as management team has no credibility and saying something like that.
So I think we're in a mode where.
Speaker 6: I think it's incumbent on you guys to lay out what you think those margins are. A lot of us shareholders, we
Thank you can comment on you guys to lay out what you think those margins are a lot of our shareholders. We think we know.
Speaker 6: and you guys spent shareholder capital for the last seven months.
And you guys spend shareholder capital for the last seven months.
Speaker 6: come to conclusion that many of us realized the path you were heading down.
Come to conclusion that many of us realized the path you were heading down.
Speaker 6: well before that. So I think we appreciate some of the transparency, but.
Well before that so I think we appreciate some of the plants Maggie.
But.
Thank you too.
Speaker 6: comment on you guys and start laying out what you think these assets really can drive in terms of cash and you know in the pager business as well as a
I can comment on you got to start laying out what you think these assets really can drive in terms of cash.
And you're on the paper business as well as the software.
Speaker 3: Yeah, let me let me to two things to respond to that. First of all, I want to correct your record in terms of management credibility and being able to do this. We've generated a billion dollars of free cash flow since we've been doing this and we've returned.
Yeah, Let me, let me to two things to respond to that first of all I want to correct you record in terms of management credibility and being able to do this we generated $1 billion of free cash flow since we've been doing this and we've returned the overwhelming majority of that to shareholders. Okay. So what you're really talking about is just spoke go.
Speaker 3: the overwhelming majority of that to shareholders okay so what you're really talking about is just spoke go uh... and we've run into a very tough scenario with spoke go with respect to what this pandemic did and so i think we made the right business decision and i think we have a track record of filling up an enormous amount of cash and you watch us will do so i don't know mike if you want to comment on the margin yet a couple of things uh... jason on the on the free cash flow margin uh...
No.
And we've run into a very tough scenario with spoke go with respect to what this pandemic did and so I think we made the right business decision and I think we have a track record of throwing off an enormous amount of cash and you watch us we will do so I don't know Mike if you want to comment on the margin.
Things, Jason on the on the free cash flow margin.
Speaker 4: You know, as you said, you could back into a lot of the numbers. We have specifically said that we could cover a majority of that $1.25 annual dividend. We think that that number is going to be about 75 to 80 percent, which is about a dollar a share at the end of the day. So that translates to about a 15 to 17 percent free cash flow margin.
As you said you could back into.
A lot of the numbers, we have specifically said that we could cover a majority of that $1 25 annual dividend, we think that that number is going to be about 75% to 80%.
Which is about a dollar a share at the end of the day, so that translates to about a 15% to 17% free cash flow margin.
Speaker 4: on the business. But we need to make this transition during this year. So those numbers can certainly change, and we hope that they would actually obviously go up.
On the business, but we need to make this this transition during this year. So those numbers can certainly change.
And we hope that they would actually obviously go up.
So 15% to 17% in aggregate on the business towards the end of the year.
Is that.
Okay. If you segment out if we just.
Speaker 5: If you segment out, if we just listed the paging business, does the paging business have higher precastral margins than the software business at the moment? Yeah, we're not, we don't do segment accounting.
Listed the paging business, the paging business have higher free cash flow margins in the software business at the moment, yes, we're not we don't we don't do segment accounting.
Speaker 4: And the other point, Jason, is that that 15 to 70 percent free cash flow margin is a run rate basis. So I think after we get through this transition on a run rate basis, which we think we'll certainly be at by the end of 2022, you would be at those free cash flows.
And any other point, Jason is that that 15% to 70% free cash flow margin is a run rate basis. So.
After we get through this transition.
On a run rate basis, which we think will certainly be at by the end of 2022, you would be at those free cash flow margins.
And then just real quick because you brought it up on the $1 billion of cash.
Speaker 5: And then just real quick, because you brought it up, Vince, on the billion of cash.
Speaker 5: Yeah. You can generate all the cash in the world, but if it doesn't, if you're a publicly traded equity and it doesn't reflect actual total shareholder returns, it doesn't matter. And well, I mean, 623 million or so of it has been returned to shareholders.
Generally you can generate all the cash in the world, but if it doesn't if you're a publicly traded equity it doesn't reflect actual total shareholder returns it doesn't matter and ball I mean, 600 $623 million or so of it has been returned to shareholders.
Speaker 3: I mean, that's money, that's like 30 bucks a share or something that they've gotten cash from us over the years, so yeah.
But I mean.
That's money, that's like 30 Bucks a share something that they've gotten cash from from us over the year. So yeah.
Speaker 3: and look you know we've got today you know case we've got today were taken out between
And look we said today, Jason we said today were taken out between.
Speaker 3: midpoint $42 million of operating expenses on a run rate basis. That's a lot of cost that's being reduced and I think each quarter going forward you'll see and it'll be much more clear what the cash flow potential, what the margin potential of this company is. But it is something that we've done before to great success.
Mid point 42 million of operating expenses on a run rate basis. That's a lot of cost that's being reduced and I think each quarter going forward you will see.
And it'll be much more clear what the cash flow potential what the margin potential of this company is but it is something that we've done before to great success, It's something that we're very focused on right now it's unfortunate that we've come to this what is the best conclusion, we have and we also have an ongoing process I'll remind you so thats keeping us a little bit busy too.
Speaker 3: something that we're very focused on right now. It's unfortunate that we've come to this, but it's the best conclusion we have. And we also have an ongoing process, I'll remind you, so that's keeping us a little bit busy, too.
Okay.
Speaker 1: As a reminder, if you would like to ask a question, please press star 1 on your telephone keypad.
As a reminder, if you would like to ask a question. Please press star one on your telephone keypad.
Right.
Yeah.
Speaker 1: Ladies and gentlemen, we have reached the end of today's question and answer session. I would like to turn this call back over to Mr. Vincent Kelly for closing remarks.
Ladies and gentlemen, we have reached the end of today's question and answer session I would like to turn this call back over to Mr. Vincent Kelley for closing remarks.
Speaker 3: Thank you very much, everyone, for joining us today, and thanks for your patience during this lengthy process. We appreciate your support and your interest in SPOC. We look forward to updating everybody again next quarter. If you have any additional questions, please reach out to our investor relations team, and we'll follow back up with you. Everyone have a great day, and please stay safe and stay healthy.
Thank you very much everyone for joining us today and thanks for your patience. During this lengthy process. We appreciate your support and your interest in spoke we look forward to updating everybody again next quarter. If you have any additional questions. Please reach out to our Investor Relations team and we will file back up with you everyone have a great day and please.
Stay safe and stay healthy.
Speaker 1: This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation. Enjoy the rest of your day.
This concludes today's conference you may disconnect. Your lines at this time. Thank you for your participation enjoy the rest of your day.
Yeah.
Speaker 7: ? ? ? ?
Yeah.
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Okay.
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