Q2 2022 Geospace Technologies Corp Earnings Call
Welcome to the G O space technologies second quarter 2022 earnings Conference call.
The call today from Geo space is Mr. Rick Wheeler, President and Chief Executive Officer He.
He is joined by Robert <unk>, The company's Chief Financial Officer, and Mark Tinker CEO of Geo space subsidiary Quantum Technology Sciences.
Today's call is being recorded and will be available on the Geo space technologies Investor Relations website following the call.
At this time, all participants have been placed in a listen only mode and the floor will be opened for your questions. Following the presentation.
If you would like to ask a question at this time. Please press star one on your telephone keypad.
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Lastly, if she if you should require operator assistance press Star zero. It is now my pleasure to turn the floor over to Mr. Rick Wheeler, Sir you may begin.
Thank you very much.
Good morning, and welcome to Geospatial Technologies Conference call for the second quarter of fiscal year 2022, I'm, Rick Wheeler, the company's President and Chief Executive Officer, and I'm joined by Robert <unk>, The company's Chief Financial Officer also with US. This morning is Dr. Mark Tinker CEO of our subsidiary quantum Technology Sciences.
First I'll provide an overview overview of the second quarter and Robert will then follow up with in depth commentary on our financial performance. After that we'll open the line for questions that Robert Mark and I will try to answer.
Some of today's statements may be forward looking as defined in the private Securities Litigation Reform Act of 1995. This includes comments about markets revenue recognition planned operations and capital expenditures.
Such statements are based on our present awareness, while actual outcomes are affected by factors and uncertainties, we cannot predict or control, both known and unknown risks can lead to performance and results that differ from what we say or imply today such risks and uncertainties include those discussed in our SEC Form 10-K, and 10-Q filings.
As mentioned for convenience, we will link a recording of this call on the Investor Relations page of our geospatial Dot Com website, and I encourage everyone to browser site to learn more about geo space and our products note that the information. We record. This morning is time sensitive and may not be accurate at the time, one listens to the replay.
Yesterday after the market closed we released our financial results for the second quarter of fiscal year 2022, which ended March 31st 2022.
We were pleased to see that revenue in the quarter reached $24 $7 million a figure representing the second highest quarterly result in the last two years.
Moreover, the quarter reflected positive momentum for the company on several fronts in March we recorded our first significant sale of deepwater obs ocean bottom nodes, when a long standing customer exercised a purchase option in an ongoing rental contract.
This sale along with our recent announcement of new Ob ex rental contracts serves to confirm geo spaces leadership in the ocean bottom nodal market.
Based on current inquiries I believe we will see higher utilization of our <unk> rental fleet in the second half of fiscal year 2022 and beyond.
Although challenges certainly remain for our oil and gas market segment increases and obs inquiries, along with our highly engaged discussions with oil and gas companies for permanent reservoir monitoring or P. R. M systems are encouraging.
Okay.
The rewards of our focused business diversification strategy were resoundingly demonstrated in the second quarter performance for our adjacent market segment revenue for this segment increased 21% over last year's second quarter topping $9 $2 million. This is the second highest quarterly amount ever recorded for these products.
And for the six months ended March 31, 2022. This segment produced $17 4 million in revenue setting a new company record for this segment's physical mid year results.
This was notably achieved despite the effects of ubiquitous supply chain problems broadly exhibited throughout all industry. Although this has introduced some delay in the rollout of our quantum smartwater valves. The debuted these products is on the near Horizon.
We expect our industrial Internet of things enabled smartwater valves and cloud management platform developed through our acquisition of the Quanta LLC last summer will add yet another vehicle of growth you are already expanding adjacent market segment.
Our diversification efforts were also evident in our emerging market segment building on the technologies originally invented for advanced border and perimeter security verification verification tests, we performed through our joint industry partnership with carbon management, Canada have proven quantum technology Sciences SEDAR Prada.
<unk> as a highly effective tool appropriately precise micro seismic monitoring subsurface reservoirs.
This has opened doors and establish new discussions on how this information can uniquely facilitate high confidence decision, making in critical applications that include carbon storage hydraulic fracking and steam assisted gravity drainage.
And other events, we're pleased to announce the completion of the new credit facility Robert will provide more details on this arrangement in his remarks.
We don't have an anticipated need to use this facility. However, we believe this proactive step gives us additional financial flexibility as fiscal year 2022 progresses, we will continue to exercise the conservative financial stewardship that has been a hallmark of Geo space management.
With that said, let me now turn it over the call to Robert to provide some financial details.
Thanks, Rick and good morning, before I begin I'd like to remind everyone that we will not provide any specific revenue or earnings guidance during our call. This morning.
In yesterday's press release for our second quarter ended March 31 2022.
We reported revenue of $24 7 million compared to last year's revenue of $23 million.
The net loss for the quarter was $1 5 million or <unk> 11 per diluted share compared to last year's net loss of $7 2 million or 53 per diluted share.
For the six months ended March 31, 2022, we reported revenue of $42 7 million compared to revenue of $52 4 million last year, our net loss for the six months period was $8 2 million or <unk> 64 per diluted share compared to last year's net loss of $8 2 million or 61%.
61 cents per diluted share.
Our adjacent market segment revenue is as follows our.
Our industrial product revenue for the second quarter of fiscal year, 2022 was $6 million, an increase of 20% over the second quarter of 2021 <unk>.
Industrial products six month revenue for fiscal year, 2022 is $11 million an increase over the same period in 2021 up 17%.
Both periods revenue increases are due to higher sales of our water meter cable and connector products and higher demand for our industrial sensor products.
Image imaging product revenue for the second quarter was $3 2 million, an increase of 23% compared to last year's revenue of $2 6 million.
Six months revenue for image imaging products for fiscal year 2022 at $6 4 million, a 25% increase when compared to the same period in 2021.
The increase in revenue for both periods is due to higher demand for our thermal imaging equipment and consumables film products.
There are oil and gas market segment revenue.
On the oil and gas markets segment produced revenue of $15 1 million for the three months ended March 31 2022.
This compares with revenue of $16 1 million for the same period of the prior fiscal year, a decrease of 6%.
For the six months period of fiscal year 2022, the segment contributed revenue of $24 8 million versus $28.
9 million a decrease of 14%.
The three and six month periods of fiscal year 2021 included revenue recognized in the second quarter for $12 5 million dollar land base wireless system that was delivered to the customer in the second quarter of 2022.
The decrease in revenue for both periods is offset by higher utilization of the company's there'll be extra rental fleet.
Finally revenue from our emerging.
Emerging market segment for the second quarter was $219 99000 compared to 165000 for the same period in 2021. The increase in revenue was primarily due to higher service revenue.
The six month revenue for this segment for fiscal year, 2022 was 436000 compared to $9 million for the same period in 2021.
Our second quarter of fiscal year, 2022, operating expenses decreased by 600000 or 6% when compared to the second quarter of 2021 to.
For the six months operating expenses decreased by 200000 or 1% when compared to the same prior year period.
The decrease in operating expenses for the three and six month periods is due to a non non cash decrease to the fair value of contingent earn out liabilities for our quantum and <unk> acquisitions offset by an increase in selling administrative and engineering costs as well as higher engineering project costs.
Our six month cash investments into our rental fleet is $2 4 million in cash and investments into property plant and equipment was 500 barrels.
Our balance sheet at the end of the second quarter reflected $11 9 million of cash and short term investments.
We recently closed on a credit facility with Amerisourcebergen ink and workforce thing to provide up to $10 million in additional liquidity and.
In addition, we own numerous real estate holdings in Houston and around the world that are owned free and clear without any leverage that.
That concludes my discussion and I'll turn the call back to Rick.
Thank you Robert.
So this concludes our prepared commentary so I'll now call turn the call back over to Chelsea, our moderator for any questions from our listeners.
The floor is now open for questions. At this time, if you have a question or comment. Please press star one on your telephone keypad.
At any point. Your question is answered you may remove yourself from the queue by pressing the pound key.
Again, we do ask that while you pose your question that you pick up your handset to provide optimal sound quality.
Our first question will come from Bill <unk> with Titan capital.
Thank you, but let me just start relative to the oil and gas side of the business.
Are you seeing.
The operators and contractor discussions accelerating really since the invasion and.
Of Ukraine, and the higher oil prices and I guess, an increased question about test global supply.
We're definitely seeing an increase in the.
The.
Oil companies interaction with contractors with respect to future projects.
Subsequent enquiries to us for equipment as it were whether it's I mean of course I'm sure. It's certainly got a direct relationship of one form or another.
To the Ukraine situation, which.
By its effects have raised oil prices as well.
But all in all all of those things are combining together such that there is definitely more interest and more.
Contractor inquiries.
That are resulting from that.
And Rick is your.
Comment they're specific to Ob X or does it apply also to land and and N. P. R. M.
Are there any major proportion.
As it relates to exploration type.
Equipment et cetera, <unk> is by far the primary component I'm talking about there is more.
<unk> discussion.
Land type equipment.
But that's very sporadic in terms of how that interest manifests.
And it's not hugely consistent to where I would equate that to an increase related to the.
The factors that you mentioned earlier.
<unk> is certainly.
Big.
<unk>, that's going on with multiple players multiple oil companies.
Again, I think that was already increasing even prior to.
Ukraine invasion.
And even at lower oil prices, but assuredly.
That is also emboldening the need for PRN and the interest for it.
Okay.
So not to put too fine of a point on it.
Are you, indicating that or seen that PR and the interest has increased in the last.
Really in the last two or three months.
There is a longer horizon to all that it's been increasing for even since then but the activity is still very much active there are definite inquiries that are pointing to even other activities and the PRN space that we weren't talking about three months ago. So definitely.
Uh huh.
There is significant activity in that area.
And are we reading.
Your comments said, both today and in the press release correct that that your.
Interactions with oil companies it is stronger than any time or higher at any minute anytime say in the last three years.
Easily that is true.
And let me then shift.
If I may to the border security business.
Mark the this this quarter, we have the first time, a service and maintenance contract with the border patrol would you discuss kind of what what.
What that entails and how.
How we should be thinking about this on a go forward basis.
Hi, Bill you bet.
Uh huh.
Any time, you deploy a complex system.
<unk> has to be maintained.
<unk> always been part of the contractual plan that we would execute additional years of maintenance upon completion of the primary contract.
So this even though it is new to us on the outside to service and maintenance contract.
To your point it is it's been anticipated all along.
Yes.
And let me.
Take a very vansickle a view here for a moment and let's say that that.
We ended up with all that let me just pick a number 100 miles of the border being.
Having your equipment on it would we then see a commensurate rise in the service and maintenance contract with.
With the border patrol.
Kind of whatever the increase in the mileage would be versus where you're at today or.
Would it really be very similar and it doesn't scale quite one for one like that.
No it would be it would be.
Or is it linear.
One for one.
Great.
Thank you both.
Thanks Bill.
Our next question will come from Robert.
Private investor.
Hi, Rick and Robert My question is.
Regarding the 120000 <unk>.
We're feet facility, we have in Russia, and what's going on with that facility and how important is it.
Two are our business outside of supply in our business outside of Russia or is it just solely for sales in Russia.
Right No. That's an excellent question and certainly one that's pertinent in current times.
Our Russian activity over there in that facility that we have is not a significant financial component of our business as it were they do provide.
Our facility for fabricating many of our geophone sensors, which are.
Made over there for US there is nothing that is made in our Russian facility in the way of geophone sensors that has not already been built here in Houston and in many cases.
The movement of that fabrication of those sensors there is a cost.
Or to reduce costs and labor costs as they present themselves over there.
They are there are.
There is the ability to get sensors are shipped out of Russia is still there are tariffs now that apply to those things and so that is something that.
I have to be dealt with.
Certainly our people over there are.
Very much taken aback by all of the circumstances that are rising now and that's a bad situation thats not one that there are.
Really signed up with there trying to earn a living themselves and they're very concerned about what's going on in their country and how these sanctions and other things will affect their individual lives.
But for the most part it is.
It's not going to be a major impact to us there are clearly adjustments we have to make in terms of fulfilling some orders were.
We'll have to began fabricating some of those components here in Houston again, and there will be additional costs.
The consumer of those products as a result of that.
But Moreover.
We don't know if that will change how things might change with respect to those sanctions.
That are applied at this point.
But we're prepared I believe for whatever happens.
Okay. Thank you.
Once again, if you do have a question you May press star one on your telephone keypad at this time.
Our next question comes from Scott Bundy with Morgan Cabinet.
Good morning, guys Hi.
Hi, Scott.
So Rick just if you could just.
Bear with me here, so let's just assume.
You do get a P. R. M contract lets just say its 50 or 100 million Bucks, where do you guys get the working capital to fulfill that contract.
Well in many cases, it's how the contract is arranged.
As far as how payments are scheduled towards the achievement of that work as it progresses certainly.
Theres also credit facilities there are available.
We have the credit facility that Robert discuss that adds $10 million of liquidity to US you can rest assure that if a project of that scope work to come to us.
And our committed way there would be other financial.
Means available to us should we need them, but in many respects.
Think that we are.
We're pretty confident.
How we go about building those types of systems, and our ability operationally to get the capital necessary.
Thanks.
Mark your podcast with Dunlop was informative.
Every week there appears to be a real money being spent on C O to sequestration.
And your podcast.
Original testing with just a few sensors, but Don alluded to the fact that you might get to the bigger playground.
Where are we are we in the playground.
[laughter].
Well, we're trying to open the gate.
For us to have us as a society have a significant impact.
On sequestering carbon in the sub surface, we have to do it at large scales. So we're calling that gigaton scales.
You know like a gigabyte.
And so when you do that you have to have a way of monitoring that it's staying there.
You can MRV or NMD plan monitoring and verification plan.
At least.
These plans are going to be part of the.
Storage contracts and deregulate it as such.
And so it can get very expensive.
Look at the scale of what a gigaton facility looks like.
Its expression on the surface of the year.
And he could literally take hundreds and hundreds and hundreds of thousands of sensors to do that monitoring.
So we're working with Don we're getting the exposure we're publishing papers, we want the community to know.
There is a way to do this that should be more affordable and equally as effective.
So carbon is a key strategic pursuit of ours.
When it comes to monitoring micro seismicity.
Yossi into underground reservoirs.
And carbon gets put into the reservoir.
We sense.
Alerting micro seismicity, we need to let the stakeholders now.
I think too Scott.
You mentioned just a few sensors I think one of the things to consider there is that's really a statement of the advancement of the technology that we can do this precise level of monitoring in such an efficient way with respect to the number of sensors and Mark mentioned that to the extent that in <unk>.
Comparison to hundreds of thousands of sensors for really large scale reservoirs. So I think that is one of the elements that is touting about being able to do this with not as many sensors and yet get much more precise data.
So how does the rest of the world find out about what SEDAR is.
Okay.
So this year, we began an outbound communication strategy.
And youre starting to see.
The initial components of that.
It's whether it's a podcast.
That gets things going within the society of exploration Geophysicists listen to that.
But being a joining industry partner with carbon management, Canada means every quarter.
All the results that have come from the facility or briefed to all of the.
Other partners.
Key stakeholders, there very large oil companies oil companies are going to be the initial and primary organizations that do this because they are the ones who understand how to interact with fluids in the subsurface.
We're also taking it and presenting papers are presenting at the Gigaton storage conference and Stanford University coming up in June .
And we're going to continue to publish and of course continue to market with our direct relationships and within oil and gas that we presently have.
Mark Who's going to pay for the additional testing, we will it will be us or them or.
Who.
Well not much so right now.
Using the facility.
That current management, Canada has its providing a lot of insight.
But there's other applications Scott.
That require micro seismic monitoring.
That are going to be a potential.
Potentially revenue producing.
The full carbon.
And we're pushing hard in those applications with companies as we speak.
And doing that in a manner in which we are compensated.
So part of your podcast also.
Don mentioned the necessity for incentives too.
Handel C O to sequestration.
Some of the discussions in the past have been.
All required.
Testing of.
Sensors like yours or someone else.
Where do you see.
We are with respect to those incentives is it carbon credits, what's what's your take on all that.
What I've been able to glean through our conversations is carbon is a commodity.
And it's going to be pushed through pipes.
Stored.
Used in enhanced oil recovery, so it's going to become a commodity and there's going to be incentives.
To encourage.
It's permanent and long term storage.
And that's got I don't I don't think on the right Guy to go into depth with you, especially on this call.
I mean, it's a very good question, Scott I think that it's questions, we ask ourselves because of the.
As you really examine this.
This is not a mature industry it is developing under our feet as we speak.
There's a lot going on with respect to how commerce is going to manifest around all the different components, which includes the transportation aspect of this of the C. O two the sequestration of it the monitoring of it all of those things are.
Sort of pieces of the puzzle that are sort of aligning themselves in real time as we go.
There's certainly a lot of money out there chasing this.
Oh to sequestration and it appears that say Dara as an insurance policy against something blowing up it's just how it all plays out it's quite interesting to me. Thanks, guys Yeah Yeah.
You're welcome Scott.
Our next question comes from Anthony Steinmetz with shiny capital.
Hey, Thanks for taking my question.
Sure Yes.
Could you speak a little bit about the competitive landscape for <unk> systems.
And could you also add a little bit of context about if youre seeing any company secure contracts for Prs systems in light of the hot oil prices currently.
There is very limited comment on competition for the PRN type systems, we do have one other competitor.
<unk> uses a different form of technology of optical fiber methodologies.
So it's not a really broad landscape of competition.
And what was your other question about the contracts.
Yes, I'm just curious to know if youre seeing.
Other companies' competition are they.
During contract because I know over the last several quarters you've reported.
Steady conversations with customers potential customers about landing a PR in contract, but none of them have actually resulted in a.
Securing a contract so im wondering if youre seeing.
Competitors secure contracts are.
If not what do you think the reluctance is with companies and.
Securing peering systems, alright, and the recent circumstances of tenders that have not manifested in work, we're not aware of any contracts.
Being granted or awarded in those circumstances I mean, the discussions certainly are ongoing in.
There's not a plethora of contracts out there by any means.
This interest is one that is pointing to the future. We expect that maybe within a years time, there will be a tender it will come out even to you know to shoot for and most of these are are are targeting installations that are.
2023 at the very earliest more likely 2024 and years beyond that.
There's a lot of interest in it and a lot of our fields out there that need this sort of monitoring.
They can go on for quite a long time, but these are not immediate.
The types of.
Contracts that we expect.
Thanks for that.
Once again, if you have a question you May press star one on your telephone keypad.
Our next question comes from Bill <unk> with Titan capital.
Thank you I'd actually like to follow up on prior questioners questions about carbon sequestration. So so first of all relative to carbon capture Canada.
Mark you said something.
In response to a question and there's a comment in the press release.
At Lee.
Leads me down the path that I think you were.
Previously trying to prove out your cost benefit.
The trade off and position within the carbon capture Canada.
Testing.
Have you have you reached the conclusion of that and if so have you demonstrated that you are.
Of all the options out there the best from a cost versus benefit.
Perspective.
Okay.
Good question Bill.
We're still in the middle of refining our understanding on that.
One of the benefits of working there at CMC current management, Canada is.
<unk> had that site instrument and using other technologies for a long time.
And.
We're literally doing.
The analysis on what some of those other capabilities are able to do compared to ours.
I will tell you it looks very promising.
Proving out proving it out will always be.
And protracted conversation.
That's why we are taking it to the technical markets first with <unk> and others.
To demonstrate it to show how well it works.
Because it is something that.
It's different.
It's not necessarily the same way as other techniques and its not that those techniques are are better and worse theyre, just a tried and true but.
For different applications. They never were ever designed to go do something that's such a large scale.
So we had a we had to bring in a different way of thinking about it and that's what we're doing.
So essentially it looks promising but it's not a fully confirmed at this point and hence your comment that you're at the gate of the playground.
Yep.
Okay that is a that is helpful. And then I wanted to come back to the service and maintenance side of of Quantum's business.
Would I E, which service and maintenance.
Also be a part of of a a field that you would would put a raise in with with quantum or is there something special about the border where that would not would not be part of it.
Oh, no it's definitely something that is under consideration, but theres a number of ways that we're also exploring bill when we look at applying SEDAR.
Pass it persistence.
<unk> reservoir monitoring concept.
For micro seismic monitoring.
Yes.
And users may not simply want to biologics.
They may we may be able to enter into a different.
Business model, providing information because that's what we're doing.
If we're providing information we're not providing data.
So that's some of the key value propositions are what we're giving them information on which they can take action.
Information has to be timely and it has to be accurate.
<unk>.
If that if that's valuable to them, they're going to be able to make.
<unk> operational efficiencies, they're going to be able to reduce risks. So how do we wanted to bring that information to market. There there might be subscription models and other models to think through it and we're actually having.
Conversations on that as we speak and we're exploring ways that would be acceptable.
Stay tuned still a lot to learn here, but it it's intriguing when youre selling information what that business model can morph into.
So hearing you say that I think about how profitable the rental business.
Has historically been for G O space on the oil and gas side. So those learnings combined with where the subscription concept, presumably then am I jumping too far ahead, presumably that would be a very profitable.
Sure.
Very profitable cash flow stream for the business.
It would be desirable to maintenance, though.
I don't think we will pursue it if it's not going to be profitable.
Rick I think that is a a grand a grand idea.
[laughter].
Robert Thanks for keeping them on track.
So in all seriousness I wanted to keep down on this service and maintenance for just a for just a moment. If you were to have a different type of border.
I'm thinking a military installation of new killer installation whatever it might be.
Would would those also include the service and maintenance I mean is this something that we ought to just be thinking as a standard part of the future if.
Equipment is purchased rather than under a subscription or at least model.
I think that's very fair and I think that's always been part of Geospatial model.
We maintained deals engineers to support our systems throughout the world.
Yes.
Transcends even to our existing <unk> systems.
So what <unk> systems out there in the course of time and there are still maintenance aspects and contracts that go on with respect to those activities.
It is.
Martin really mentioned earlier on I mean these.
These systems have a complexity to them that it just requires a certain amount of attention and an ongoing basis, they do not necessarily.
At a maintenance level represent.
Major revenue sources are or anything of that nature, but they are.
And a component of these sorts of contracts.
Right. Okay. That's that's helpful and then finally.
Mark in in response to to that same question are you said that there is.
There was an industry or an application that could happen.
Revenue producing before carbon capture but applications, where you're referring to.
Alright, I'll do a little micro sites with 101 with all the listeners.
So anytime you interact with fluids in the subsurface fluids could be gas liquids.
You are changing the state of pressure than you are.
So doing youre changing the state of stress.
And when you alter the state of stress.
Fractures little Microfracture slipped.
Breaking a pencil and release energy and Thats, what we call micro seismicity and.
There's a lot of it and we'd like to know about it.
But we really like to know about micro seismicity that can be associated.
Two.
A failure in the integrity of the reservoir.
For associated to when we're intentionally braking.
Rock that we call tight shale that might hold gas.
So the applications range from carbon of course.
To hydraulic fracturing.
Two steam assisted gravity drainage.
Because when you pump high pressure steam in the melt.
A hockey puck.
You extract as that flows that that tar sand out, but holding that in place that high pressures and cap rock.
And at that cap rock sales you lose your field.
So these are big Stakes.
And when you can add real time information.
You can significantly improve operational efficiencies and so let's unpack that just a little bit more.
So what if I can increase my production by some amount 1% to 3% a day.
And do so with confidence.
I'm not going to break my catalog.
And that can be a very.
Incentivised reason to look at what we are able to provide.
No hydraulic fracturing of course, we do it on purpose we've been monitoring.
We've been monitoring hydraulic fracturing for a long time using techniques and what we're proposing is something that's.
A little bit disruptive.
We want to monitor the fracturing fields for a very long duration of time.
Not just for a couple of weeks and provide that information back in real time, both before during and after operations. That's a safety thing.
It can induce seismic concern for liabilities.
But it also allows you to again make real time decisions as Youre actively treating the frac deal can we do this with certainty yet no.
But we're really good at what we do and this is where we're going.
And these are the things that I think will break loose sooner as we strategically pursue and shake the monitoring of sequester carbon.
Great. Thank you very much I appreciate it.
Thank you. Our next question will come from Scott <unk> with Morrison Cabinet.
Sorry, a quick follow up question border patrol the Theres, a transcript out there I forget exactly when it was but it's within a couple of years that clearly by the border patrol that clearly identified 100 miles.
Oh.
Areas that you guys could put your sense or so.
So with the.
Sensors that we now have in place and in your opinion is it going to take finding a tunnel or.
Or is it just a budgetary item.
What what gets us to two to roll out some additional mileage with our sensors.
Okay.
It's a protracted engagement Scott.
What gets US there is you got to go to the headwaters of funding and that's that's the hill.
And customs and border protection in the United States border patrol they have their priorities.
And as you know right now securing our border.
Is not an enviable task.
There's a lot of.
It has a lot of dimensionality to it.
So.
What gets us there is a little bit of patients.
A little bit of proving.
And understanding of managing very sophisticated technology.
So we want to endure ourselves to always be a teammate of the border patrol.
For things that it's completely bipartisan.
That needs to be accomplished.
So we're very fortunate we're very proud to be a component of that.
That bipartisan pursuit.
But it just takes the.
It's kind of like working at PRN contract it.
It takes a little bit of fortitude. Luckily, we again are very dialed in and were very proactive and we have very good relationships. So so.
I don't I don't know how to get more specific with your answer. So do you think that that and of course, they very rarely disclose except on occasion.
That the system is doing what it's intended to do meaning you are finding that people are penetrating.
Oh without knowing that like tunnel, but it's doing what it's supposed to do so validating the technology.
I can't say, what the system is being used for.
And now that it's fully operational.
How they are using it and what they are discovering.
Is only known to them.
Oh interesting.
Okay.
Got it thank you.
Youre welcome.
We have no further questions at this time I would like to turn the call back over to Mr. Rick Wheeler for any additional or closing remarks.
Alright, well, thank you Chelsea and thanks to everyone, who joined our call today, we look forward to speaking with everyone again on our conference call for the third quarter of fiscal year 2022 in August so for now goodbye.
Thank you. This does conclude today's geospatial technologies second quarter 2022 earnings conference call.
Please disconnect. Your line at this time and have a wonderful day.
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