Q2 2022 Rekor Systems Inc Earnings Call
[music].
Good afternoon, ladies and gentlemen, and welcome to today's record systems incorporated conference call. My name is Latanya and I will be your coordinator for today.
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. Please press star zero on your telephone keypad.
As a reminder, this conference being recorded for replay purposes.
Before we get started I would like to read you the company's abbreviated Safe Harbor statement.
I would like to remind you that the statements made in this conference call I'm signing future revenues results of operations financial positions markets economic conditions product and product releases partnerships and any other statements that may be construed as a prediction of future performance or events are forward looking statements.
Such statements involve known and unknown risks uncertainties and other factors, which may cause actual results to differ materially from those expressed or implied by such statements.
We ask that you refer to the full disclaimer in our earnings release.
It should also review a description of the risk factors contained in our annual and quarterly financial filings with the S. E C.
non-GAAP results will also be discussed on this call. The company believes the presentation of non-GAAP information provides useful supplementary data concerning the company's ongoing operation and is provided for informational purposes only.
I would now like to turn the presentation over to Mr. Don Kim CFO of record systems. Please proceed sir good afternoon, and thanks for joining us today.
They will discuss three quarters as a result for the three and six months ended June 30, 2022.
And provide you with an update on key business topics are.
CEO , Robert Burgin would it be on the Covid me today and will provide additional color on our business.
After I go over all relevant metrics.
In the second quarter of 2022 we continue to accelerate growth and recurring revenue under our new selling model.
As explained previously since the third quarter of 2021.
Been shifting our emphasis from point to point in time revenue to recurring revenue.
While we continue to engage in point in time.
So hum in appropriate circumstances, or new model emphasizes providing software and data services on a subscription basis.
This has had a near term impact on our overall revenues, but with the strong growth we're seeing in recurring revenues.
With them about the positive impact it will have on our overall strength and stability for the long term.
With that in mind, let me get into some of the details in the financial results for the second quarter ended June 31 22.
Highlights include.
The completed acquisition of cell phone traffic solution.
Revenue for the three months ended June 30, 2022 with consistent at $4 3 million dollar.
Revenue for the six months ended June 30, 2022 with $7 9 million compared to $8 5 million in the same period last year, a decrease of 6%.
<unk> revenue for the three and six months ended June 20 June 30, 2022 inquiry.
$1 2 million and 2 million respectively.
Compared to the same period last year.
This increase represents growth in recurring revenue of 133%.
115% for the three and six months period ended June 32022, compared to the same period last year.
Performance obligation increased to $31 9 million dollar.
June 32022, compared to $22 6 million daughter.
At December 31st 2021.
As you can see in less than a year. It was the change in our sales model. We've reached a point where the growth in our recurring revenues has essentially compensated for the decline in point in time Robert.
The percentage of recurring revenue reflected in total revenue was 48% for the three and six months ended June 32022, compared to 21% for the three and six months ended June 30, 2021.
As I mentioned, we expect to continue pointing time hardware and software sales inappropriate circumstances.
And that May result in strong increases in product revenue in future quarters like the English we so in the first quarter of 2021.
But with our current emphasis emphasis on building south based revenue or subscription sales, we expect to generate a stable base for long term growth well beyond what we could have achieved under the previous model.
Total operating expenses for the six months ended June 32022, or $28 2 million compared to $10 million during the same period in 2021.
Inquiries.
Operating expenses.
From significant increases in payroll and payroll related expenses.
The additional head count due to the way care acquisition played a part in this increase.
We added new hires to our engineering sales and marketing teams as we integrated their technology into our growing suite of product and service offerings.
With the acquisition of S. Yeah, we're continuing to enhance and improve our lineup of products with important investments that will enhance its competitive edge.
However in view of the near term opportunities that this acquisition has provided us with.
We expect to narrow and consolidated sales and marketing efforts and the first time development effort as long as we'll discuss later.
Our adjusted gross margin for the three and six months ended June 30, 2022 and 2021 decrease to 38, 5% from 67, 7%.
And 41, 5% from 61, 1% percent respectively.
The decline in margin for the quarter ended June 32022.
Primarily attributable to increased investment in winning and implementing new projects as we focus on larger implementation.
Quickly expand our technology co presence in key areas.
We expect to see an improvement in our adjusted gross margin is our land and expense plus India continues to evolve in the future.
Adjusted EBITDA for the three and six months ended June 30, 2022 and 2021 <expletive>.
Decreased to a loss of $11 $2 million from a loss of $2 9 million dollar.
And a lot of when he points.
$5 million from a loss of $6 million respectively.
This increase in loss was due to the investment to position Hooker recall for future growth that I've just discussed.
Since we changed the revenue model were released enhanced keep performance indicators to help provide visibility and more concise view into our success and progress.
We hope that over time, these kpis will provide our shareholders with a better insight into our business.
As noted in our financial highlight our recurring revenue for the three and six months ended June 30, 2022 increase.
100, 133% and 115% compared to the same period 2021.
In the first half of 2022 we want 5 million daus.
All our of new contract. This is a decrease of 14% compared to $5 8 million of new contract value. One during the first half of 2021.
Related primarily to the decrease in points in time hardwood sale discussed earlier.
The decrease in total contract value was also partially related to our winning math based on our experience within UO to accommodate customers budget.
Budget constraints and acquire a shorter term subscription than we have previously offered.
As of June 30, 2022 remaining contract performance obligations were $31 9 million dollar.
We expect to recognize approximately 57% of this amount over the succeeding 12 months.
This represents an increase of $9 $4 million or 41% compared to $22.6 million of performance obligations as of December 31st 2021.
This increasing performance obligation was primarily due to our Sps acquisition.
As we continue to focus on building relationships and extending our presence we acquire customers through pilot program.
Which are typically short in nature.
We continue to convert and expand our pilot program the largest scale contract we would expect to see these kpis improve.
Moving to our financial condition and liquidity.
Our cash balance on June 30, 2022 was $14 million down from $25 $8 million as of December 31st 2021.
Working capital on June 30, 2022 was $7 $3 million down from $17 million as of December 30 for 2020 one.
The decrease in working capital was primarily due to a decrease in cash and cash equivalents.
This decrease was primarily due to the increase in our loss from operation as we position the company for future growth and also reflects cash used in the acquisition of it yes.
The decrease in cash was partially offset by a net cash inflow of $24 million as part of our 2022 at the market sales agreement.
In summary, we're a passion.
Our growth prospect and continued to experience strong momentum in our market.
As al will discuss with the team with you next we're concentrating our investments now on rapidly increasing our margin and fully expect them to improve significantly.
We remain focused on creating shareholder value and making a decision that will benefit our long term shareholders.
With that I will now turn the call over to Robert.
Yeah.
Thank you al good afternoon, everyone and welcome so let's talk about our revenue and expenses.
This time last year, we made the decision to concentrate on developing a stream of recurring revenue and we've said there will be trade offs. When you go from depending primarily on point in time revenue model, where recurring revenue model you can expect to have a negative impact on near term revenue growth. The question is how long does it take for growth.
And recurring revenue to make up for the reductions in the point of time revenue.
With the success of our efforts over the past few quarters I think we are at the point, where we've achieved that transition as they are.
I'll just describe them less than a year, we were able to transition from where recurring revenue were 21% of our total quarterly revenues.
One more recurring revenues generated 48% of our totally call. It revenue while total revenue for the second quarter of 2022 was essentially the same as the corresponding period of 2021.
But that's not the only thing we have to be focused on.
At the end of the day, we want to emerge as a highly profitable enterprise, we haven't invested a major technology advances just to provide us with a slight edge in a narrow crowded market segment.
We've set our sights high and want to exploit high value propositions that will never feasible before.
So at the same time, we've been concentrating on building a more stable revenue base, we've been concentrating on developing a package of solutions that can both make the roadways of the future measurably safer and more efficient and provide us with a profitable return on investment.
With the acquisition of <unk> and now S. T S. We've been able to dramatically increase our geographic coverage and enhance our customer base. We're now working jointly with many of the worlds largest globally services and vehicle manufacturing companies.
To deliver cutting edge products and service services around the World and then just the last three months, we wont assignments from tree State D O Ts to provide different types of innovative new services.
As the world shifts to re imagine and rebuild the infrastructure over the past three quarters already an active partner helping to define its future.
Record as well on the road to becoming the trusted operating system for digital infrastructure on a road was a record one brain captures multiple sources of data examines patterns and provides insights decisions and actions to support multiple missions using AI to continuously reinforced the learning curve.
We pull in the data from our devices and third party data sources and from existing infrastructure.
Your brain and uses its AI and push our proprietary IP and machine learning to work intelligently process. This big pool of data.
Visualized not only what is happening or what might happen. This results in actionable insights for our three key market segments transportation management urban mobility and public safety.
And then of itself that doesn't make us profitable right now.
It's given us the tools, we need to become profitable over the next year as you know we play a significant role in the improvements envisioned by the infrastructure investment and jobs Act, which are just beginning to be funded as we speak.
The main focus of that initial funding will be the data collection and analysis. This will not be a build and then they will come.
Imaging of our nation's infrastructure, while the debt data driven re imagining of infrastructure looking for bachelors and efficiency and safety.
We've been developing a proprietary technologies and capabilities needed to address this massive undertaking in a way that's both structures and profitable we've been doing this by developing a modular platform that can be ingesting enormous amounts of data and deliver mission critical digital infrastructure solutions and insights to.
And commercial users and we've been positioning the company to deploy it profitably over the remainder of 2022.
In Q2, we saw a lot of what I just mentioned.
Recall was selected for the launch of a multi year program with the Missouri Department of transportation Modoc, So not only make roads less congestion and safer, but to help with the state of severe traffic crashes all key objectives of Missouri's Xiaomi zero strategic Highway safety plan for 'twenty, one 'twenty 'twenty five.
Recourse transportation management platform was certified by AWS as well architected to improve traffic and incident management increased public safety and security and optimize urban mobility.
Artifically objectively validates recourse solutions as achieving highest distinctions in security reliability performance efficiency and scale for customers to adopt and deploy with confidence and also opens up new growth channels through AWS has extensive global partner network and marketplace.
Recall was also selected by the Israeli National infrastructure company, where AI driven intelligent infrastructure on Israel's highways as the core system for integrating and processing data into a single source of truth.
Of course traffic management solution will bring digital and physical infrastructure together.
Track, the most data possible from the roadway and the environment.
The project will use data from multiple record edge based optical roadway sensors and consolidate this real time traffic analytics data with seven other diverse realtime datasets, including dash Cam footage public transit analytics and video footage of roadway incidence enhancing traffic enforcement and incident response.
Abilities.
We also completed the acquisition of S. T S near the end of June the impact of this acquisition isn't really a factor in our Q2 earnings but it is expected to be an important contributor to our profitability as we move forward.
Historically S. T S has annually generated $15 million of revenue.
50% is recurring and $3 million of EBITDA.
And we have every reason to expect to build on this this acquisition combine two complementary companies with the primary objective of accelerating recourse path to profitability going forward.
30 years of traffic engineering and data collection expertise from STS together with recourse next generation artificial intelligence machine learning technologies has positioned us to become a leader provider of <unk>.
Data services for the agencies in the U S that are working right now for planning intelligent infrastructure of the future.
And just the last few weeks since the acquisition S. T. S has already significantly expanded its relationship with the Florida, and Ohio D O Ts to incorporate the roadway AI that recall brings to the table into their operations.
So with wake her an S. T S acquisitions, we've secured our position as a cutting edge technology provider as well as a trusted source of data services for departments of transportation.
The United States.
Our next task, particularly under current market conditions is to ensure that we use that position to become profitable as quickly and efficiently as possible.
So before we open it up for questions I'd like to address the current state of the capital markets and its impact on our plans for growth.
There's no doubt that the uncertainty in these markets has resulted in a downturn. It is impacted just about every public company, especially technology companies like many many other companies in the tech space, we will have to do more with less we're in an economic environment that the mass more intensity and we've already been taking steps.
To do maintain our growth using fewer resources.
Since the acquisition of S. T S. We've been working to consolidate operations concentrate on near term profitability and steadily reduce head count growth.
Many of our teams are going to shrink so that we can shift energy into other areas inside the company and we've given our leaders the ability to decide within their teams were to restructure where to double down and where to backfill attrition in this process will be prioritizing the positions. We're in to take advantage of the funding.
That's beginning to flow from the infrastructure investment and jobs Act, we expect to see both cost efficiencies and continued revenue growth.
Reflected in the future quarters, as we continue to unlock the value from that.
<unk> opportunities for growth the last year has provided us with.
So despite the current challenges I'm very confident for the long term.
I'd like to turn the call back to our operator, who will moderate the Q&A session.
Okay.
Thank you we will now conduct a question and answer session.
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One moment, while we poll for our first question.
Okay.
Our first question comes from Mike Latimore with Northland Capital markets. Please proceed.
Great. Thanks very much.
So on the Florida, and Ohio expansions can.
Can you just elaborate on those a little more and maybe.
You mentioned you know how much incremental business came from those expansions.
Sure Al.
Okay.
Yeah.
Yes.
Mike This country does not have a lot of attached to it.
We just signed a contract and it is not yet public information that we can disclose what I can say is that as we announced before extending these contracts we increase our relationship with this a significant D O Ts.
And once we have.
Well the numbers in mooresville maintenance to share it with different well share it with the market.
Okay. Okay.
And then.
The focus on near term profitability.
When should we think about you know you're hitting say EBITDA breakeven is that our first quarter of 'twenty three kind of time frame or what are you thinking there.
The Royal Commission.
Sorry go ahead.
Go ahead al.
I said as well reaching in the earnings release, we are working to make our organization more efficient.
We cannot provide the exact time, but we are we believe that same time.
Our next 12 months will be a breakeven.
Okay.
And then just lastly, just a clarification on the U S.
So it's been doing about $15 million of revenue should we as we kind of model it out over the next 12 months.
That's what we should put in our models or will there be a little you know.
Step back and he's got an undergrad or maybe an uptick from some of these fashion.
Mike Mike that's a that's a good question and I think it's fair to say that.
Look S. T. S was a pioneer in data services. So as as you may know or some of you may not know, but all the states are mandated to collect traffic data for the federal government each year and SCS pioneered about half a decade ago. The idea of installing systems that include inductive loops and other things in the roadways.
For the states and then selling the data back to them and the stuff that they collect as opposed to just putting in a system and selling it as a contractor and then maintaining it.
So they've got a fairly large footprint throughout the south eastern United States, and very strong relationships with their customers for decades and by the insertion of recourse technology into that process and elimination of the old antiquated ways of collecting that data I think within the S. T S footprint, we're going to see.
Both.
So that's the that's why we bought STS because they're there's a trusted relationship. There you don't just walk into a D. O T. You know and start working with them. The next day, where they are going to be comfortable with the data you're getting them. They've got a trust. Your you know your integrity and have had the history with you. So I think the growth is going to come from the combination of record and S.
He has together by introducing our technology into Sts's business and footprint.
And I think we'll see growth as a company in general and that's what we're seeing with the expansion with Florida right now and also in Ohio.
Okay, great. Thank you.
Thank you.
Our next question comes from Zach Cummins with B Riley. Please proceed.
Yeah, Hi, good afternoon, Thanks for taking my questions, Hey, Al and Robert I'm, just talking about gross margins here in the quarter I know you ticked down to 38, 5% I think a lot of that is upfront costs associated with some of these project implementations, but.
Can you talk about just maybe if theres any other impacts to gross margin in the quarter and as you start to get more of these pilots converting to revenue what's going to be more of a I would say normalized gross margin range, especially the STS and hold in the future.
And thank you for the questions that good question.
And as you mentioned the gross margin decline is really an upfront cost that we have and as we announced in the past.
We believe this that the FDA is together with their current business that we have to contribute to our gross margin and increase for for the midterm to about 60% to 70% gross margin. That's what we anticipate that's what we always say and for the long long run once we have more data services revenues.
In.
We do anticipate to be on the 70% to 80% gross margin.
Understood and Robert are you.
You're prioritizing profitability here in the near term I mean.
And I know, it's still kind of early days in terms of your strategy, but can you give us any sort of insight into maybe what specific areas that youre, considering kind of maybe reducing spend or even cutting back some head count and.
I know that you're going to be having a more focused approach when it comes to kind of a near term revenue opportunities. So can you speak to I guess, just which opportunities would be the low hanging fruit or or the fastest time to revenue for you and then it was sales force.
I think that's a really good question. It's a fair question and it's an important question look we've spent three years building technology, because we believe.
That the World you know, what's going to move towards bringing infrastructure into the digital age and we're seeing that now and you're going to see that with this trillion dollar infrastructure spend that we're doing here in the U S. They're going to bring infrastructure into the digital age.
All the things that we've done over the last three years, some more transactional somewhat point in time all of them related to different components. On this platform that we were building some more hardware components that we couldnt get on the market from hardware suppliers have to develop ourselves others were related to our software algorithms firmware within the hardware and so on and so forth I think.
It's happening at this point is where we're comfortable in saying that we can start to drop away from all of those other businesses and put less focus on those things and put all of our effort and what we started out to do which is to be a data services company building an operating system for the road noise, that's what we're doing.
As of the beginning of Q2.
All of this year and and you know that's what we're going to continue to do throughout the rest of 2022 and to enter 2023 and I think what that means is that we expect more and more of our revenues every quarter to come from data services.
From the aggregation of data the repurposing of data and the sale of data to both commercial and governmental customers higher margins.
Longer term contracts at much greater value and that's what it's going to bring us to profitability and what that requires is a robust engineering department to support the products that we built so you know some of our cuts and reductions you know may not come so much on that side of the business as they will.
More on the operating side, where we were doing these one off transactions and installations of systems that really wasn't core to our business, but we did them because we had a test or our products on our platform and our hardware and our software and live environments right. So we can we can pair all that back now and we can get focused on.
On what we set out to do which is as you know to be a data services company in an aggregate or on a kind of repurpose or data insight and salad data right. So we've been after its only for three years and I'm proud of the fact that we were able to get to this point in three years.
And I think when we picked up wake her we brought in all of that external data into our platform our brain as David likes to call. It who's on the call with US and then you know S. T. S has the is basically the horse, it's gonna get us into the market with their footprint. Okay. On the other side. So we can focus on all of that now so that's where it's going to come from Zack it's going to come from.
Focusing on data services and less so on all the other stuff that's point in time in transactional and I think it's really that simple and we can do that now we can do that now.
Understood. That's helpful. Thanks, Robert and then final question for me is in terms of the contract that you announced with with the Florida D O T. A few weeks ago.
It seems like pretty significant opportunity, but can you talk about it.
This opens the door to other agencies within Florida, or if there's sort of contract is that something that could be replicated in different states. Just just speak a little more to kind of be opportunity beyond even just that floater contract.
It's a contract that relates to again data, okay, and managing or monitoring what happens on a bicycle and pedestrian pathways.
And there's a safety component to it and absolutely it can be replicated in not only in Florida, but in other states and throughout Florida and the the way the contract is structured we have the liberty of designing the system to meet their needs and introducing components of safety into it using tools that they had not had the ability to do before.
And and our understanding of it through US yes, the way to D. O T works as you know, it's it's a contract that that's multi year, but the funding is there for them. If they can see that the you know the utility of the <unk>.
The products and they'll do it all immediately and then just re up it and move it to another piece of the states. So that's a good question Zack and that's the whole point of all of this all of these things that we're doing I would encourage everybody on this call to look at not the value of the contracts had recourse been announcing but look at the nature of the contracts the recourse announcing there.
Quite a unique and I don't think you're going to find any other company is saying you know some of what we're doing so that's the nature of that contract sector relates to bikes and pedestrians and and the data around that and I'll spend and also safety component and then using the new technology to change the way it's been done in the past and bring as you know safety component to it so hopefully that is.
Helpful.
Yeah very helpful. Well, Thanks again for taking my questions and best of luck with the rest of the quarter.
Yeah. Thank you.
Once again to ask a question. Please press star one on your telephone keypad. Our next question comes from Casey and Brent Boucher capital. Please proceed.
Hi, Thanks, very much for taking the question just following up on some of these other revenue opportunities could you just kind of briefly update us on where we are with the border patrol contract any update on Mastercard.
Just kind of rolling out.
Visibility on that and then if there's any other reseller opportunity that the company might be able to kind of tap into the supplement some of the revenues.
Yep, Thanks, Casey I mean, well first with custom and border patrol again, no control over it.
What we know is the same thing that everybody knows what they post publicly which is that they are down selected to four.
Our primary contractors of which you know recourse partnered with all of them.
And they've now said that they're going to make the announcement at the.
They expect sometime later this fall what we have said publicly and.
Folks do know is that we're partnered with the incumbent and they continue to use our technology and extended it just into very early next year, I guess, assuming they're thinking as well that there'll be a decision whether they win again or whether somebody else takes it over so that's what we know okay with respect to Mastercard, we continue to pilot with them.
You know I guess, they're doing what they do.
And you know again everything else that you know we've worked on this point of time transactional like those things are all great they're healthy, they're bringing money to bring in revenue they bring in margin.
The casing and they're good questions and I'm sure, we'll focus on them if the opportunities there, but we don't want to get distracted by you know those things.
Haven't been working on and we wanted to get focused on on what we're doing with the states.
Data services, so that's kind of where it is.
Okay and then just.
Hmm.
No.
No they're gone.
No no sorry.
Thank you.
Just and then just one last question just on the Ses deal it sounds like a great deal and seeing these other things kind of plug into it.
When we think about profitability.
And the next 12 months I guess by Q2 of next year.
How does that look do we just kind of.
Put together the revenues of the two companies and then they accelerate or we put together the expense base or we reduce the expense base like can you just kind of help us kind of get there optically from 10000 feet.
I think that you can look at S. T S.
And you can assume there's going to be growth.
And probably at a higher margin, okay, because we're introducing new technology into the way they do what they do.
And I think with respect to our expenses, you're going to see our SG&A stabilize with across some of the verticals inside the company and come down and others. So it's gonna be a combination of those two things and look we've said we think we can get there within 12 months. So we're talking about this time next year or sooner and we believe that and we think that.
Again, it's going to come from a combination of revenue.
And stabilizing expenses work.
You know having slight reductions.
Okay and one last question just on the Kpis you guys just kind of talked about.
Do you know when we're going to have a time, when we get a little bit more visibility on when these contracts convert from pilot to contract and how he sees going yeah.
I think you'll start seeing that I mean look we've owned S. T S. Four.
Yes, and I think two weeks of the quarter.
And you know we saw you know a contract there right. So I think again the nature of it Casey and these are good questions. The nature of that business in that world and it's not just S. T. S. It's a it's the.
I'm just the world of the way things are done.
With regard to infrastructure. These are usually 357 year contracts.
So they're much larger.
The dollar values are higher and I think hopefully that's what you're going to start seeing from us and I think that's going to reflect in both the performance obligation as you've seen here just with a couple of weeks of STS as being part of a record as well as you know the thing Andy.
Annual recurring revenue. So we expect those two kpis to continue to grow and then there's the margins you know.
Recover.
Then you know you're going to see.
You know how the company gets there I think.
Okay.
Thanks very much.
Yes. Thank you.
Our next question comes from re GETCO, what private Investor. Please proceed.
Oh, yes, thanks for taking my call and our shareholders for a while but can you touch on the pilots that we mentioned about 10 months ago, The Philadelphia Navy yard.
Winchester, Virginia, and I believe you had one was Chattanooga, Tennessee and also roughly how many pilots are ongoing at this time.
These pilots are still ongoing and.
There are others, but.
That's a good question, we shifted our business thinking with respect to pilots you know Theres a point in time when technology is new in the company, John where you look you'll do anything you can deploy your technology and to work with the customer right and you do pilots that are very low revenue or no revenue.
You know we've gotten past that now so we're not doing those kinds of pilots anymore.
I think what you're going to see as you know the company going straight to contracts now so I wouldn't look at pilots I think a lot of what we did with these pilots prove the technology and they they got us to.
Where we are with certifications like with AWS as we talked about on the call and other things that are helping to propel. It forward. So I think you know again, our thought processes moved away from pilots to.
Look.
We can do this so you know do you want do you want to use the company's products right. So I think that's where we are but most of what you talked about still ongoing in expanding I mean in Philadelphia, they keep adding components to the to the pilot there and there was an introduction of a commercial component to that so we look at those things like laboratories anyway. So you know there they were.
Long term pilots.
Six months or better so there.
They're still in process.
And my final question Lance I, just we've been playing future acquisitions.
Rises.
Yeah.
That's a that's a really good question and I will tell you that from where I sit here. Today. This is just my view.
I I don't see it I think you know we have the pieces, we need now to scale. This business and I think our focus is going to be on scale and growth and profitability.
And if an acquisition came along it would have to be directly related to what we're doing every day and be accretive immediately and add lots of business, but.
Not for the purposes of why we acquired wake her and we were integrating it and that's not why we acquired S. Yes, we have the pieces that we need now to do what we need to do.
Okay. That's all I have much thanks, and I appreciate you keeping your investors up to speed as often as you do thanks again.
Yeah. Thank you. Thanks, so much.
There are no further questions in queue at this time I would like to turn the floor back over to Mr. Robert Berman, Our Chief Executive Officer, Yeah, well look thanks look thanks, everybody appreciate the time and patience and just in closing again you know we've been at this for three years.
<unk> spent a lot of time and effort and resources, thanks to the support from our shareholders.
And all the stakeholders in the company.
And we built some great technology and I think now it's our opportunity to deploy it and monetize it and we're really excited about where we sit.
Given what's happening in the industry with respect to the changes.
With the way people and governments look at infrastructure and also the way the car companies look at the way their vehicles that they sell travel crossover always so we think we're well positioned and hopefully we'll be able to prove that what the results of our operations over the next 12 months. So thank you everyone.
Thank you. This does concludes today's teleconference. You may disconnect. Your lines at this time and thank you for your participation.
Yeah.