Q1 2024 Senstar Technologies Corporation Earnings Call

Operator: Greetings and welcome to the Senstar Technologies first quarter 2024 financial results. At this time, all participants are in a listen-only mode. A brief 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 is being recorded. It is now my pleasure to introduce your host, Kim Rogers, with Hayden IR. Thank you, Kim. You may begin.

Operator: Greetings and welcome to the Senstar Technology's first quarter of 2024 financial results. At this time, all participants are in listen-only mode.

Greetings and welcome to the Sun Star Technologies first quarter 2024 financial results.

Speaker Change: At this time all participants are in a listen only mode.

Operator: A brief question-and-answer session will follow the formal presentation.

Speaker Change: A brief question and answer session will follow the formal presentation.

Operator: If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded.

Speaker Change: If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad.

As a reminder, this conference is being recorded.

Kimberly Rogers: It is now my pleasure to introduce your host, Kim Rogers, with Heated IR.

Speaker Change: It's now my pleasure to introduce your host Kim Rogers with Hayden IR. Thank you Kim you may begin.

Kimberly Rogers: Thank you, Kim. You may begin.

Kimberly Rogers: Thank you, Camilla. I'd like to welcome everyone to the conference call and thank Senstar Technology's management for hosting today's call. With us on the call today are Mr. Fabien Haubert, CEO of Senstar Technologies, and Ms. Alicia Kelly, CFO. Fabien will summarize key financial and business highlights, followed by Alicia, who will review Senstar financial results for the first quarter of 2024.

Kimberly Rogers: Thank you, Camilla. I'd like to welcome everyone to the conference call and thank Senstar Technologies Management for hosting today's call. With us on the call today are Mr. Fabien Haubert, CEO of Senstar Technologies, and Ms. Alicia Kelly, CFO. Fabien will summarize key financial and business highlights, followed by Alicia, who will review Senstar's financial results for the first quarter of 2024. We will then open the call for a question and answer session. Before we start, I'd like to point out that this conference call may contain projections or other forward-looking statements regarding future events or the company's future performance.

Kimberly Rogers: Thank you Camilo I'd like to welcome everyone to the conference call and thank Sunstar technologies management for hosting today's call with us on the call today are Mr. Fabian Colbert C E O offense star technology, and Miss Alicia Kelly CFO.

Speaker Change: Adrian will summarize key financial and business highlights followed by <unk>, who will review some stars financial results for the first quarter of 'twenty 'twenty. Four we will then open the call for question and answer session.

Kimberly Rogers: We will then open the call for question-and-answer session.

Kimberly Rogers: Before we start, I'd like to point out that this conference call may contain projections or other forward-looking statements regarding future events or the company's future performance. These statements are only predictions, and Senstar cannot guarantee that they will in fact occur. Senstar does not assume any obligation to update that information. Actual events or results may differ materially from those projected, including as a result of changing market trends, reduced demand, and the competitive nature of the security system's industry.

Kimberly Rogers: These statements are only predictions, and Sunstar cannot guarantee that they will, in fact, occur. Furthermore, Sunstar does not assume any obligation to update that information. Actual events or results may differ materially from those projected, including as a result of changing market trends, reduced demand, and the competitive nature of the security systems industry. Additionally, the unanticipated and unknown effects of the coronavirus, including on our operations and our clients, as well as other risks identified in the documents filed by the company with the Securities and Exchange Commission.

Speaker Change: Before we start I'd like to point out that this conference call may contain projections or other forward looking statements regarding future events or the company's future performance.

Speaker Change: The statements are only predictions and sunstar cannot guarantee that they will in fact occur done started does not assume any obligation to update that information.

Speaker Change: So with that well.

Speaker Change: Our results may differ materially from those projected including as a result of changing market trends reduced demand and the competitive nature of the security systems industry.

Kimberly Rogers: The unanticipated and unknown effects of the coronavirus, including on our operations and our clients, as well as other risks identified in the documents filed by the company with the Securities and Exchange Commission.

Speaker Change: The anticipated an unknown effect of the Corona virus, including on our operations and our clients as well as other risks identified in the documents filed by the company with the security and Exchange Commission.

Kimberly Rogers: In addition, during the course of the conference call, we will describe certain non-GAAP financial measures which should be considered in addition to and not in ZULA's comparable GAAP financial measures. We've noted that in our press release, we have reconciled non-GAAP financial measures to the most directly comparable GAAP measures in accordance with red juice requirements. You can also refer to the company's website at www.senstartechnologies.com for the most directly comparable financial measures and related reconciliation.

Kimberly Rogers: In addition, during the course of the conference call, we will describe certain non-GAAP financial measures, which should be considered in addition to, and not in lieu of, comparable GAAP financial measures. Please note that in our press release, we have reconciled non-GAAP financial measures to the most directly comparable GAAP measures in accordance with Reg G requirements. You can also refer to the company's website at www.senstartechnologies.com for the most directly comparable financial measures and related reconciliation. And with that, I'd now like to hand the call over to Fabien. Fabien, please go ahead.

Speaker Change: In addition, during the course of the conference call, we will describe certain non-GAAP financial measures, which should be considered in addition to and not in lieu of comparable GAAP financial measures. Please note that in our press release, we have reconciled non-GAAP financial measures to the most directly comparable GAAP measures.

Horton with Reg G requirements.

Speaker Change: You can also refer to the company's website at Www Sunstar technologies Dot com for the most directly comparable financial measures and related reconciliation.

Fabien Haubert: And with that, I'd now like to hand the call over to Sabian.

Sandy Caribbean: With that I'd now like to hand, the call over to Sandy Caribbean. Please go ahead.

Fabien Haubert: Pravian, please go ahead. Thank you, Kim.

Sandy Caribbean: Thank you Jim.

Fabien Haubert: Thank you for joining us today to review Senstar's technology for squatter 2020-24 financial reasons. We're off to a strong start in 2024, with a squatter result that improved year-over-year across major financial metrics. We delivered revenue growth of 17% compared to the first quarter of last year. And importantly, our profitability from operation improved significantly.

Fabien Haubert: Thank you for joining us today to review Senstar's technology for SQUADR 2024 financial resources. We're off to a strong start in 2024 with first quarter results that improve year over year across major financial metrics. We delivered revenue growth of 17% compared to the first quarter of last year, and importantly, our profitability from operations improved significantly. Before diving into our financial and business highlights, I'd like to highlight a major accomplishment for the first quarter.

Thank you for joining us today to review since stopped technology first quarter 'twenty 'twenty for financial reasons.

Sandy Caribbean: We're off to a strong start in 2020 for the first quarter original but improved year over year across major financial metrics we.

Sandy Caribbean: We delivered revenue growth of 17% compared to the first quarter of last year.

Speaker Change: Importantly, our profitability from operations improved significantly.

Fabien Haubert: Before diving into our financial and business highlights, I'd like to highlight a major accomplishment for the first quarter. In March, we should press release announcing Senstar's successful rhythm as filing to Canada, with streamlined the organization and with just operating costs. I dish only I had the honor of being confirmed at the CEO and Alicia was promoted to CFO. This steps position Alicia and me to effectively achieve our strategic objectives. Revenue in the first quarter was derived from higher margin profits and price adjustments compared to last year. Driving our growth margin to nearly 60% of revenue, in line with a target growth margin goal.

Speaker Change: Before diving into our financial and business highlights.

Speaker Change: To highlight a major accomplishment for the first quarter.

Fabien Haubert: In March, we issued a press release announcing Senstar's successful rhythm asylum in Canada, which streamlines the organization and reduces operating costs. Additionally, I had the honor of being confirmed as the CEO, and Alicia was promoted to CFO. These steps position Alicia and me to effectively achieve our strategic objectives. Revenue in the first quarter was derived from higher margin profits and price adjustments compared to last year, driving our growth margin to nearly 60% of revenue, in line with our target growth margin goal. Operating expenses decreased 15% and represented 60.6% of revenue, compared to 80.6% in the year-ago quarter.

Speaker Change: In March we issued a press release announcing sensed our successful rhythm is filing to Canada, which streamlines the organization and reduced operating costs.

Speaker Change: Additionally, I had the hunter of being confirmed that the CEO and Alicia was promoted to CFO.

Alicia Kelly: These steps position Alicia meet to effectively achieve our strategy objectives.

Alicia Kelly: Revenue in the first quarter was derived from higher margin products and price adjustments compared to last year driving our gross margin to nearly 60% of revenue in line with our target gross margin goal.

Fabien Haubert: Operating expenses decreased 15% and represented 60.6% of revenue compared to 80.6% in the year-ago quarter. In terms of profitability, our operating loss improved significantly from the loss of 1.7 million in the year-ago quarter to a loss of 73,000 dollars, approaching break even from operation. Cost control measures and price adjustments that we implemented over the course of 2023 have taken hold and are more apparent in our financial results.

Alicia Kelly: Operating expenses decreased 15% and represented 66% of revenue compared to 86% in the year ago quarter.

Fabien Haubert: In terms of profitability, our operating loss improved significantly, from a loss of 1.7 million in the Euro quarter to a loss of $73,000, approaching break-even from operations. Cost control measures and price adjustments that we implemented over the course of 2023 have taken hold and are more apparent in our financial results. Notably, for the first quarter, we delivered growth in most of our geographic regions, with notable spending in Asia-Pacific and Latin America.

Alicia Kelly: In terms of profitability, our operating loss improved significantly from a loss of $1 7 million in the year ago quarter to a loss of $73000 approaching breakeven from operation.

Alicia Kelly: Cost control measures and price adjustments that we implemented over the course of 2023 have taken hold and are more apparent in our financial results.

Fabien Haubert: Notably, for the first quarter, we delivered growth in most of our geographic regions with notable trends in Asia-Pacific and Latin America. In the US, our largest market as a person of revenue, revenue increased by 6% in the first quarter, mainly due to great achievements in the correction and utility markets. Under our recently pointed new leadership, the US team is making fantastic progress in developing our position with strong business development activities, especially in the data centers and utility segments. In Europe, one of our largest markets, revenue increased by 8% in the first quarter. Market demand in Europe remains strong, especially in the utilities, energy, and transport sectors.

Alicia Kelly: Notably for the first quarter, we delivered growth in most of our geographic regions with notable.

Alicia Kelly: Then in <unk>.

Alicia Kelly: Asia Pacific and Latin America.

Fabien Haubert: In the U.S., our largest market, revenue increased by 6% in the first quarter, mainly due to great achievements in the corrections and utility market. Under our recently appointed new leadership, the U.S. team is making fantastic progress in developing our position with strong business development activity, especially in the data centers and utility segments in Europe. In Europe, one of our largest markets, revenue increased by 8% in the first quarter. Market demand in Europe remains strong, especially in the utilities, energy, and transport sectors.

Alicia Kelly: In the U S. Our largest market as a percent of revenue.

Alicia Kelly: Revenue increased by 6% in the first quarter, mainly due to greater achievement and the correction and utility markets.

Speaker Change: Under our recently appointed New leadership the U S team is making fantastic progress in developing our position with strong business development activity, especially in the data centers and utility segments.

In Europe.

Speaker Change: One of our lunch just markets revenue increased by 8% in the first quarter.

Speaker Change: Market demand in Europe remained strong, especially in the utilities energy and transport sectors.

Fabien Haubert: Sensor has invested in Europe in previous years, developing promising opportunities in markets where we were underrepresented. In addition, Sensor has improved its market share in established territories, which also contributes to a growth on Q1. The sustained focus on QCM's and targeted vertical has been the key to our success. In Asia-Pacific, our revenue grew by 150 percent compared to the previous year's first quarter, under the drive of new leadership. Growth was mainly generated from the utilities and transport verticals, with a concentrated effort on existing territories from North to South-A-Pac. In the Latin region, we sustained a higher growth rate with experience in late 2023, again this quarter.

Fabien Haubert: Senstar has invested in Europe in previous years, developing promising opportunities in markets where we were underrepresented. In addition, Senstar has improved its market share in established territories, which also contributed to growth in Q1. Focusing on key accounts and targeted verticals has been the key to our success. In Asia-Pacific, our revenue grew by 150% compared to the previous year's first quarter under the drive of new leadership. Growth was mainly generated from the utilities and transport verticals with a concentrated effort on existing territories from north to south Abeis.

Speaker Change: <unk> has invested in Europe in previous years.

Speaker Change: They are looking promising opportunities in markets, where we were underrepresented in.

Speaker Change: In addition, <unk> has improved its market share in established territories, which also contributed to our growth on Q1 <unk>.

Speaker Change: Our sustained focus on key accounts and targeted vertical has been the key to our success.

Speaker Change: In Asia Pacific our revenue grew by 150% compared to the previous year's first quarter under the drive of new leadership.

Speaker Change: Growth was mainly generated from the utilities and transport vertical.

Speaker Change: With a concentrated effort on existing territories from low two dose APAC.

Fabien Haubert: In the LATAM region, we sustained a higher growth rate we experienced in late 2023 again this quarter. Primarily due to wins in the correction verticals, we delivered 39% growth in Q1. Looking at the revenue contribution from our key four verticals, Utilities, Correction, Energy, and Logistics, revenue increased by 30% in this key market segment.

Speaker Change: In the Latam region, we sustained the higher growth rate, we experienced in late 2023 again this quarter.

Fabien Haubert: Primarily due to winning the correction verticals, we delivered 39 percent growth in Q1.

Speaker Change: Primarily due to wins in the correction verticals, we delivered 39% growth in Q1.

Fabien Haubert: Looking at the revenue contribution from our T4 verticals, utilities, corrections, energy, and logistics. Revenue increased by 30% in this key market segment. We remain committed to a business development strategy with cute count in these verticals to drive over growth.

Speaker Change: Looking at the revenue contribution from our key four verticals utilities correction energy and logistics revenue increased by 30% in this key market segments. We remain committed to our business development strategy with key accounts in these verticals to drive our growth.

Fabien Haubert: We remain committed to our business development strategy with Q-counting these verticals to drive our growth. Looking ahead, we're most excited about the official launch of Multi-sensor this quarter. Multisensor is our new AI-based intrusion detection system that uses an embedded sensor fusion engine to intelligently synthesize data from multiple sensing technologies, providing full intrusion situational awareness and reducing false alarm rates close to zero. The system includes short-range radar, PIR, accelerometer, high-frequency vibration, and image sensor.

Fabien Haubert: Looking ahead, we're most excited about the official launch of multi-sensor discordant. Multi-sensor is our new AI-based inclusion detection system that uses an embedded sensor fusion engine to intelligently synthesize data from multiple sensing technologies, providing full inclusion situation awareness and reducing pole-solum rates close to zero percent. The system includes so-trained radar, PIR, accelerometer, high-frequency vibration, and image sensor. The multi-sensor is being extremely well received by major players in our industry and recognized as an advanced and versatile solution, unlike anything else on the market. We're building a vetted pipeline of new sales opportunity, and we expect to begin recording sales in the second half of the year.

Speaker Change: Looking ahead, we're most excited about the official launch of multi sensor this quarter.

<unk> sensor is our new AI based intrusion detection system that uses an embedded sensor fusion engine to intelligently synthesize data from multiple sensing technologies.

Speaker Change: Providing full intrusion situational awareness and reducing false alarm rates close to zero percent.

Speaker Change: The system includes so trends radar.

Speaker Change: I R accelerometer high frequency vibration and image sensor.

Fabien Haubert: The multi sensor is being extremely well received by major players in our industry and recognized as an advanced and versatile solution, unlike anything else on the market. We are building a vetted pipeline of new sales opportunities, and we expect to begin recording sales in the second half of the year. In summary, the first quarter delivered solid results across key metrics, with growth in important geographies and gains in target verticals, resulting in year-over-year revenue growth and improved profitability. We remain focused on achieving continued growth and improvement on these metrics as we progress through 2024. I will now turn the call over to Alicia for a review of the financial results in more detail.

Speaker Change: The multi sensor is being extremely well received a major players in the wind industry and are recognized as an advanced and burst digital solution.

Speaker Change: Unlike anything else on the market.

Speaker Change: We are building a pipeline of new sales opportunity and we expect to begin recording sales in the second half of the year.

Fabien Haubert: In summary, the first quarter delivered solid results across key metrics, with growth in important geographies and gains in target verticals. We're resulting in year-over-year revenue growth and improved profitability. We remain focused on achieving continuous growth and improvements on this metrics as we progress through 2024.

Speaker Change: In summary, the first quarter delivered solid results across key metrics.

Speaker Change: With the growth in important geographies in games and third target verticals, resulting in year over year revenue growth and improved profitability.

Speaker Change: We remain focused on achieving continued growth and improvement on these metrics as we progressed through 2024.

Alicia Kelly: I will now turn the call over to Alicia for a review of the financial results in more detail. Thank you, Fabian. Our reported revenue for the first quarter of 2024 was $7.5 billion, an increase of 17% compared with reported revenue of $6.4 million in the first quarter of 2023. As Fabian discussed, the increase was primarily due to revenue growth of 30% in our key vertical market.

Speaker Change: I will now turn the call over to Alicia for a review of the financial results in more detail.

Alicia Kelly: Thank you Fabian I reported revenue for the first quarter of 2024 was $7 5 million, an increase of 17% compared with reported revenue of $6 4 million in the first quarter of 2023.

Alicia Kelly: Thank you, Fabien. Our reported revenue for the first quarter of 2024 was $7.5 million, an increase of 17% compared with reported revenue of $6.4 million in the first quarter of 2023. As Fabien discussed, the increase was primarily due to revenue growth of 30% in our key vertical market. The geographical breakdown as a percentage of revenue for the first quarter of 2024 compared with the prior year quarter is as follows. North America, 52% versus 58%. Europe, 28% versus 31%. APAC, 14% versus 6%. Latin America, 5% versus 4%.

Alicia Kelly: As Damian discussed the increase was primarily due to revenue growth of 30% in our key vertical markets.

Alicia Kelly: The geographical breakdown as a percentage of revenue for the first quarter of 2024 compared with the prior year quarter is as follows. North America, 52% versus 58%. Europe, 28% versus 31%. APAC, 14% versus 6%. Latin America, 5% versus 4%. And others remain flat at 1%.

Are you a graphical breakdown as a percentage of revenue for the first quarter of 2024 compared with the prior year quarter is as follows North America, 52% versus 58% Europe, 28% versus 31% APAC, 14% versus 6% Latin America, 5% versus 4%.

Alicia Kelly: And others remained flat at 1%. Reported gross margin was 59.6% of revenue for the first quarter of 2024, compared to 55.7% of revenue for the first quarter of 2023. This revenue improvement was primarily the result of a shift in our product mix to higher-margin products in the quarter and price adjustments taken in 2023. Our reported operating expenses were $4.6 million, a decrease of 15% from the prior year's quarter's operating expenses of $5.3 million.

Alicia Kelly: And others remained flat at 1%.

Alicia Kelly: Report of growth margin was 59.6% of revenue for the first quarter of 2024, compared to 55.7% of revenues for the first quarter of 2023. This revenue improvement was primarily the result of the shift in our product mix to higher margin products in the quarter and price adjustments taken in 2023.

Speaker Change: <unk> gross margin was 59, 6% of revenue for the first quarter of 2024 compared to 55, 7% of revenue for the first quarter of 2023. This.

Speaker Change: This revenue improvement was primarily the result of a shift in our product mix to higher margin products in the quarter and price adjustments taken in 2023.

Alicia Kelly: Our reported operating expenses were $4.6 million, a decrease of 15% from the prior year's quarter's operating expenses of $5.3 million. The year-over-year decrease in operating expenses is due primarily to lower gene access and lower selling and marketing expense as a result of our efforts to streamline operations and diligently manage our overhead cost. Our operating loss narrowed significantly in the quarter to a loss of 73,000 compared to a loss of 1.7 million in the year-go period. The year-over-year improvement was due to higher growth margins on higher sales and lower operating costs. Financial income was 54,000 compared to 40,000 in the first quarter of last year.

Speaker Change: Our reported operating expenses were $4 6 million.

Speaker Change: A decrease of 15% from the prior year's quarter operating expenses of $5 3 million.

Alicia Kelly: The year-over-year decrease in operating expenses is due primarily to lower G&A expense and lower selling and marketing expense as a result of our efforts to streamline operations and diligently manage our overhead costs. Our operating loss narrowed significantly in the first quarter to a loss of $73,000 compared to a loss of $1.7 million in the year-ago period. The year-over-year improvement was due to higher gross margins on higher sales and lower operating

Speaker Change: The year over year decrease in operating expenses is due primarily to lower G&A expense and lower selling and marketing expense as a result of our efforts to streamline operations and diligently now to manage our overhead costs.

Speaker Change: Our operating loss narrowed significantly in the first quarter to a loss of 73000 compared to a loss of $1 7 million in the year ago period, a year over year improvement was due to higher gross margins on higher sales and lower operating costs.

Alicia Kelly: Financial income was $54,000 compared to $40,000 in the first quarter of last year. This is mainly a non-cash accounting effect we regularly report due to the adjustment to the valuation of our monetary assets and liabilities denominated in currencies other than the functional currency of the operating entities in the group in accordance with GAAP. The net loss attributable to Senstar Technology shareholders in the quarter was $746,000 or $0.03 per share versus a net loss of $1.9 million or $0.08 per share in the first quarter of last year.

Speaker Change: Financial income was 54000 compared to 40000 in the first quarter of last year.

Alicia Kelly: This is mainly a non-cash accounting effect we regularly report due to the adjustment to the evaluation of our monetary access and marginalities, denominated inferences others in the functional currency of the operating entities in the group in accordance with gaps. Net loss attributable to some start technology shareholders in the quarter was $746,000 or $3 cents per share versus a net loss of $1.9 million or $8 cents per share in the third quarter of last year. The company reported positive EBITDA for the first quarter of 114,000, versus an EBITDA loss of 1.4 million in the first quarter of last year.

Speaker Change: This is mainly a noncash accounting in fact, we regularly report due to the adjustment to the valuation of our monetary assets and liabilities denominated in currencies other than the functional currency of the operating entities in the group in accordance with GAAP.

Speaker Change: Net loss attributable to censor technology shareholders in the quarter with 746000 or <unk> <unk> per share versus a net loss of $1 9 million or eight seven per share in the first quarter of last year.

Alicia Kelly: The company reported positive EBITDA for the first quarter of $114,000 versus an EBITDA loss of $1.4 million in the first quarter of last year. Taxes on income were $700K compared to $200K in the first quarter of last year. The exceptional increase was primarily due to a tax revision related to the reorganization of the group structure and a reduction in tax assets, which was offset by the recovery provision for an uncertain tax position due to this statute of limitations.

Speaker Change: The company reported positive EBITDA for the first quarter of 114000 versus an EBITDA loss of $1 4 million in the first quarter of last year.

Alicia Kelly: Taxes on income were 700k, compared to 200k in the first quarter of last year. The exceptional increase was primarily due to a tax revision related to the reorganizing the group structure and a reduction in tax assets, which was offset by the recovery provision for an uncertain tax position due to this statute of limitations.

Speaker Change: Taxes on income were 700 carry compared to 200 K in the first quarter of last year. The exceptional increase was primarily due to a tax provision related to the re organizing that group structure and a reduction in tax assets.

Speaker Change: Asset, which was offset by the recovery of provision for an uncertain tax position due to the statute of limitation.

Alicia Kelly: Senstar's operational expenses include its public platform and amortization of intangible assets from historical acquisitions. The corporate expenses and amortization expenses for the first quarter were $600,000 versus $1.1 million in the first quarter of the year before. Cash and cash equivalents as of March 31, 2024 were $15.8 million, $4.68 per share, as compared to $14.9 million as of December 31, 2023.

Alicia Kelly: Senstar's operational expenses included public platforms and amortization of intangible assets from historical acquisition. The corporate expenses and amortization expenses for the first quarter were 600k, versus 1.1 million in the first quarter of the year before.

Speaker Change: <unk> operational expenses included public platform and amortization of intangible assets from historical acquisition.

Speaker Change: Corporate expenses and amortization expenses for the first quarter were 610 versus $1 1 million in the first quarter.

Speaker Change: Of the year before.

Alicia Kelly: Cash and cash equivalent of the March 31st, 2024, more 15.8 million, four 68 cents per share, as compared to 14.9 million, as of December 31st, 2023.

Speaker Change: Cash and cash equivalents as of March 31, 2024, or $15 8 million $4 68 per share as compared to $14 9 million as of December 31 2023.

Alicia Kelly: That concludes my remarks.

Operator: That concludes my remarks. Operator, we would like to open the call to questions. Thank you. We will now be conducting a question and answer session.

Speaker Change: That concludes my remarks, operator, we would like to open the call to questions now.

Operator: Operator, we would like to open up all the questions now. Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tool will indicate that your line is in the question queue, and you may press star 2 if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your hands up before pressing the star keys. One moment, please. Will you pull for questions? Thank you.

Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue, and you may press star 2 if you'd like to remove your question from the queue. It may be necessary to pick up your handset before pressing the start key.

Speaker Change: Thank you.

Speaker Change: Now be conducting a question and answer session. If you would.

Speaker Change: Like to ask a question. Please press star one on your telephone keypad.

Speaker Change: Confirmation tone will indicate that your line is in the question queue.

And you May press star two if you'd like to remove your question from the queue.

Speaker Change: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys My.

Operator: One moment, please, while you poll for questions. Thank you. Our first question comes from the line of Ken Liddy with Oppenheimer. Please proceed with your question. Hi. Congratulations on top.

Speaker Change: One moment. Please I'll you poll for questions.

Thank you. Our first question comes from the line of Ken Liddy with Oppenheimer. Please proceed with your question.

Ken Liddy: Our first question comes from the line of Ken Litty with Oppenheimer. Please proceed with your question.

Ken Liddy: Hi.

Hi.

Fabien Haubert: Congratulations on the solid quarter. Just wanted to know, in the first quarter, was there any significant costs or savings from your double cell redevelopment in Canada? Okay. Thank you for your question. Yes, there was some savings attributable to the redevelopment solution. As we mentioned, we have restructured, and we've restructured to Canada. In doing so, essentially, there are some hits out that were eliminated naturally from the headquarter level, and then there was also some savings that were less significant in the operating entities as well. Was there any one-time charges in the quarter that was from the change that was significant or material?

Ken Liddy: Congratulations on a solid quarter. I just wanted to know, in the first quarter, was there any significant cost or savings from your Redouble Selling in Canada.

Ken Liddy: Congratulations on the solid quarter.

Ken Liddy: Just wanted to know in the first quarter.

Speaker Change: Was there any significant.

Costs or savings from your domicile retail with solving in Canada.

Speaker Change: Okay.

Speaker Change: Yeah.

Fabien Haubert: Okay, thank you for your question.

Speaker Change: Okay. Thank you for your question.

Speaker Change:

Fabien Haubert: Yes, there were some savings attributable to the redone affiliation. As we mentioned, we have restructured, and we've restructured to Canada. And in doing so, essentially, there are some headcounts that were eliminated naturally from the headquarter level. And then there were also some savings that were less significant in the operating entities.

Speaker Change: Yes, there was some savings attributable to the re done affiliation as we mentioned we have a restructured and have been restructured to Canada and in doing so essentially there are some head count that were eliminated.

Speaker Change: From the headquarter level and then there was also some savings that were most significant in the operating entities involved.

Ken Liddy: Was there any one-time charges in the quarter that resulted from the change that are significant or material?

Speaker Change: Was there any.

Speaker Change: One time charges in the quarter.

Speaker Change: From the change that are significant or material.

Speaker Change: Sure.

Fabien Haubert: No, no one-time charges this quarter.

Fabien Haubert: No one-time charges this quarter.

Speaker Change: No no onetime charges this quarter.

Speaker Change: Okay.

Fabien Haubert: Okay, and it looks like you had some strong positive cash flow in the quarter. What was that attributable to? That was just the natural effect of bus completing Q4. So a large portion of our cash came from the collections of our Q4 sales, which were higher during Q4 2023.

Ken Liddy: and It looks like you had some strong positive cash flow in the quarter. What was that attributable to?

Speaker Change: And.

Speaker Change: So it looks like you had some strong positive cash flow in the quarter, what was that attributable to.

Fabien Haubert: That was just the natural effect of us completing Q4, so a large portion of our cash came from the collections of our Q4 sales, which were higher during Q4 of 2023.

Speaker Change: That was just the natural effect of bus that complete in Q4. So a large portion of our cash came from the collection of our Q4 sales which were up higher.

Speaker Change: A higher during Q4 of 2023.

Ken Liddy: Okay, and one last question. With regard to the launch of the multi-sensor, I'm just trying to gauge how significant this launch is, is there... Is this something that you can compare to another product in Senstar's history, or is it, you know, a big deal, or is it a very big deal, or is it expected to be a solid contributor?

Fabien Haubert: Okay, and one last question. With regard to the launch of the multi-center, I'm just trying to gauge how significant this launch is. Is there, is this something that you can compare to another product in Senstar's history, or is it a big deal, or is it a very big deal, or is it expected to be a solid contributor? So it is expected to be a major change where we're going to for many reasons. The first thing is we, the multi-center basically is a technology which is totally new. Most sensors today in the parameter detection segments are focusing on one technology.

Speaker Change: Okay.

Speaker Change: And one last question with regards to the larger the multi sensor.

Speaker Change:

Speaker Change: Okay.

Speaker Change: Just trying to gauge how significant this law.

Speaker Change: <unk> is a is there.

Speaker Change: Is this something that you can compare it to another product and sensors history or is it.

Speaker Change: Or is it.

Speaker Change: A big deal or is it a very big deal or is it.

Speaker Change: Expect it to be a solid contributor.

So it is expected to be a major.

Fabien Haubert: So it is expected to be a major change where we're going for many reasons. The first thing is, we...

Speaker Change: Change of where we're going to for many reasons.

Speaker Change: The first thing is we are.

Fabien Haubert: The multi-sensor is basically a technology that is totally new. Sensors today in the perimeter detection segment are focusing on one technology, and we believe that we've touched the limits of every one of those technologies. The multi-sensor has as its target to reduce the pulse along to zero. So to give you an analogy, the best sight will never replace the sight, the hearing, the smelling, the sensing, and the brain to compile all this information to have a clear situational awareness of what's going to happen.

Speaker Change: The multi sensor basically is the technology, which is totally new.

Speaker Change: Hum.

Speaker Change: Most.

Speaker Change: Sensors today in the perimeter detection segment.

Speaker Change: Focusing on one technology and we believe that we've touched the limits of every one of those technologies. The multicenter has as a target to redo the false alarm to zero so to give you an analogy.

Fabien Haubert: And we believe that we've touched the limits of every one of those technologies. The multi-center has a target to reduce the pulse along to zero, so to give you an analogy of human body. The best site will never replace the site, the hearing, the smelling, the sensing, and the brain to compile of this information to have a clear situation or awareness, what's going to happen. Today, perimeter is doing it, and it's going to become mine, eventually with another technology, like video to check whether and along has a cure or not. It's going to be combined with another technology on top of it.

Speaker Change: Human body, the best site will never replace the site the hearing the smelling the sensing and the brain to compile all this information to have a clear situational awareness, what's going to happen.

Fabien Haubert: Today, uh, perimeter is doing it, and it's going to be combined eventually with another technology, like video, to check whether an alarm has occurred or not. It's going to be combined with another technology on top of it. We like to give the analogy the mobile phone, the iPhone, typically. 15 years ago, we all had our flipping phone together with an MPEG-3, together to listen to music, together with the GPS, together with a PDA, and a digital camera. Today, it's just one device.

Speaker Change: Today.

Speaker Change: Right.

Speaker Change: The perimeter is doing it and it's going to be combined eventually with another technology like video to check whether <unk> is going to be combined with another technology on top of it.

Fabien Haubert: We like to give the analogy, the mobile phone, the iPhone, typically. Fifteen years back, we all had our flipping phones together with a Manpeg 3, together to listen to music, together with the GPS, together with the PDA and digital camera. Today, it's a one device. We believe that to improve the performance and in parameter detection to reduce it to zero, the only way to do it is to use the conversion of technology to combine it in the device and to use intelligence to be able to translate the data into situational awareness and then the right decisions.

Speaker Change: We like to give the analogy.

Speaker Change: Mobile phone their iPhone typically.

Speaker Change:

Speaker Change: 15 years back we all had.

Speaker Change: Flipping them.

Speaker Change: Phone together with them in big three together to listen to music together with the GPS together with it.

Speaker Change: Our PVA and digital camera to date, so one device, we believe that to improve their performance.

Fabien Haubert: We believe that to improve performance and... [inaudible] So we believe to be ahead of the market by proposing that. So it's a step that is not only adding another technology, which we have been doing in the past, but using different technologies to provide basically a single device, an intelligent device able to provide a decision and understanding which is better than anything you've seen today. So that's in terms of why we did it.

Speaker Change: <unk>.

And perimeter detection to reduce it to zero the only way to do it is to use the conversions of technology to combine this into an advice and to use intelligence to be able to translate that data into seats will desaturation situational awareness and then the right decisions. So we believe to be ahead of the market by proposing that so.

Fabien Haubert: We believe to be ahead of the market by proposing that. It's a step which is not only adding another technology, which we have been doing in the past, but using different technologies to provide basically a single device, an intelligent device able to provide a decision, an understanding, which is better than anything you think today. So that, in terms of why we did it.

Speaker Change: It is a step which is not only adding another technology, which we have been doing in the past, but using different technologies to.

Speaker Change: To provide basically a single device and intelligent device able to provide.

Speaker Change: The decision and understanding which is better than anything you're seeing today.

Speaker Change: With that in terms of why we did it so where do we expect growth first of all we're going to try it we're going to put it on the high end of our solution portfolio.

Fabien Haubert: So where do we expect growth? First of all, we're going to try to put it on the high end of our solution portfolio and buy one of the best solutions, and so on. But on top of that, we expect to take market shares from other technologies, like video cameras and so on, by having a system able to do many things at once. And finally, the product we expect to be targeting not only the critical infrastructure but also the critical points of non-critical infrastructure, which is heavily broadening our targeted markets. I hope to have answered your question by this long, but I hope... No, yeah. Yeah.

Fabien Haubert: So where do we expect growth? First of all, we're going to put it on the high end of our solution portfolio. And by one of the best solutions and so on, but on top of it, we expect to take market years to other technologies to like video cameras and so on by having a system able to do anything at once. And finally, the product, we expect to be targeting not only the critical infrastructure, but as well the critical points of non-critical infrastructure, which is heavily broadening our targeted markets. I hope to have answered your question by this long, but I hope.

Speaker Change: And.

Speaker Change: By one one of the best solution, that's one but on top of it we expect to take market share to other technologies.

Speaker Change: <unk> video cameras, and then swung by having a system able to do anything at once and finally the.

Speaker Change: The product, we expect to be targeting not only the critical infrastructure, but as well as the critical points of non critical infrastructure, which is heavily broadening.

Speaker Change: Our targeted markets I hope to have answered your question by this long, but I hope.

Speaker Change: Yes.

Ken Liddy: That's a lot of color. I really appreciate it. Is there any type of groundswell of interest from your customer base or outside of your customer base?

Speaker Change: Yes.

Ken Liddy: That's a lot of color.

Speaker Change: A lot of color I really appreciate it.

Fabien Haubert: I really appreciate it. Is there any type of groundswell of interest from your customer base or outside of your customer base? Today we have a huge positive reaction from the market of the first introduction. Translated in a lot of these are detested to do full of concepts and whatsoever. So we're extremely excited by the release, which is will happening in two weeks' time. And will you be, are you at the point of pilot testing it? And will you be announcing any pilot test? We're not going to communicate on that so far. Okay.

Speaker Change: Is there any type of groundswell of interest from your customer base or outside.

Speaker Change: Outside of your customer base.

Fabien Haubert: Today we have a huge positive reaction from the market for the first introduction, translated and a lot of desire to test it, to do proof of concept, and so on. We're extremely excited by the release, which will be happening in two weeks.

Speaker Change: Today, we have a huge.

Speaker Change: Positive reaction from the markets, although the first introduction.

Translated in a lot of desire to test it to do proof of concepts on whatsoever. So we're extremely excited by the release, which is.

Speaker Change: Happening in two weeks time.

Ken Liddy: And will you be, are you at the point of pilot testing it, and will you be announcing any pilot tests?

Speaker Change: And will you be.

Speaker Change: Are you at the point of pilot testing it.

Speaker Change: Will you be announcing any pilot trials.

We're not going to communicate on that so far.

Fabien Haubert: We're not going to communicate on that so far. Okay.

Ken Liddy: Okay, and then one last question, I'm sorry. Has the company thought about, or does the company have any discussions regarding a stock buyback? Given the low value of [inaudible] It is not planned on short terms.

Speaker Change: Yeah.

Speaker Change: Okay, and then one last question I'm sorry.

Ken Liddy: And then one last question. I'm sorry. Has the company thought about or is the company having any discussion regarding a stock buyback given the low value of a company's shares? It is no plan on short. Don't share. Understood.

Speaker Change: How does the company.

Speaker Change: Thought about.

Speaker Change: Or is the company have any discussion regarding the stock buyback.

Speaker Change: Given the low value of.

Speaker Change: Our company shares.

Fabien Haubert: It is not planned in the short-term. Understood. Thanks for taking my question.

Speaker Change: It is not plan on short term Sir.

Speaker Change: Understood.

Ken Liddy: Thanks for taking my question. You're welcome. Thank you.

Speaker Change: For taking my questions.

Speaker Change: Youre welcome.

Fabien Haubert: Thank you. As a reminder, if you would like to ask a question, please press star 1 on your telephone keypad. Thank you. We have reached the end of our question and answer session, and with that, I would like to turn the floor back over to Mr. Fabien Haubert for any closing comments.

Speaker Change: Thank you as a reminder, if you would like to ask a question. Please press star one on your telephone keypad.

Operator: As a reminder, if you would like to ask a question, please press star one on your telephone keypad. Thank you.

Speaker Change: Thank you.

Operator: We have reached the end of our question and answer session.

Speaker Change: We have reached the end of our question and answer session and with that I would like to turn the floor back over to Mr. Fabian Hulburt for any closing comments.

Fabien Haubert: And with that, I would like to turn the floor back over to Mr. Fravian Hobert for any closing comments. On behalf of Sense Up Management, I would like to thank our investors for their interest and long-term support of our business. Have a good day.

Fabien Haubert: On behalf of Senstar Management, I would like to thank our investors for their interest and long-term support of our business. Have a good day. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

Speaker Change: On behalf of sense of management I would like to thank our investors for their interest and long term support of our business have a good day.

Speaker Change: Okay.

Operator: This concludes today's teleconference. You may disconnect your lines at this time.

Operator: This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

Speaker Change: This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

Operator: ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ??

Speaker Change: Okay.

Speaker Change: [noise] [noise].

Operator: Thank ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ � ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ ¶ �

Speaker Change: [music].

Speaker Change: Yeah.

Speaker Change: Uh huh.

Speaker Change: Okay.

Speaker Change: [noise] mhm.

Speaker Change: [music].

Uh huh.

Speaker Change: Mhm.

Speaker Change: [music].

Speaker Change: Uh huh.

Speaker Change: Oh, Oh Oh.

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: [music].

Speaker Change: Yeah.

Speaker Change: [music].

Speaker Change: Hum.

Speaker Change: Hum.

Speaker Change: [music].

Speaker Change: Yeah.

Speaker Change: [music].