Q4 2024 IDT Corp Earnings Call
Good evening and welcome to the IDT Corporations Fourth Quarter in full fiscal year 2024 earnings call. In today's presentation, IDT's management will discuss IDT's financial and operational results for the 3 and 12 month periods ended July 31, 2024.
Unknown Attendee: Fiscal Year 2024 Earnings Call. In today's presentation, IDT's management will discuss IDT's financial and operational results for the three and 12-month periods ended July 31, 2024.
Unknown Attendee: During prepared remarks by IDT's Chief Executive Officer, Samuel Jonas, all participants will be in listen-only mode.
During prepared remarks by IDT's Chief Executive Officer Schmuld Jonas, all participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero.
Unknown Attendee: Should you need assistance, please signal a conference specialist by pressing the star key, followed by zero.
Unknown Attendee: After Mr. Jonas's remarks, Marcelo Fischer, IDT's Chief Financial Officer, will join Mr. Jonas for Q&A with investors.
After Mr. Jonas's remarks, our Sonal Fisher, IDT's chief financial officer, will join Mr. Jonas for Q&A with investors.
Unknown Attendee: Any forward-looking statements made during this conference call, either in the prepared remarks or in the Q&A session, whether general or specific in nature, are subject to risks and uncertainties that may cause actual results to differ materially from those which the company anticipates. These risks and uncertainties include, but are not limited to, specific risks and uncertainties discussed in the reports that IDT files periodically with the SEC.
Any forward-looking statements made during this conference call, either in the prepared remarks or in the Q&A session, whether general or specific in nature or subject to risk and uncertainties that may cause actual results to differ materially from those which accompany anticipates.
These risks and uncertainties include, but are not limited to specific risk and uncertainties discussed in the reports that IDT files periodically with the SEC.
Unknown Attendee: IDT assumes no obligation either to update any forward-looking statements that they have made or may make, or to update the factors that may cause actual results to differ materially from those that they forecast.
IDT assumes no obligation either to update any forward-looking statements that they have made or may make. Or to update the factors that may cause extra results to differ materially from those that they forecast.
Unknown Attendee: In their presentation or in the Q&A session, IDT's management may make reference to non-GAAP measures, including adjusted EBITDA, non-GAAP net income, and non-GAAP earnings per share. A schedule provided in IDT earnings release reconciles adjusted EBITDA, non-GAAP net income, and non-GAAP earnings per share to the nearest corresponding GAAP measures.
In their presentation, or in the Q&A session, IDT's management may make reference to non-gap measures, including a just to divadah, non-gap net income, and non-gap earnings per share.
A schedule provided in IDP earnings release reconciles adjusted EBDA, non-gap, net income, and non-gap earnings per share to the nearest corresponding gap measures.
Unknown Attendee: Please note that the IDT earnings release is available on the Investor Relations page of the IDT Corporation website. The earnings release has also been filed on Form 8-K with the SEC.
Please note that the IDT earnings release is available on the Investor Relations page of the IDT Corporation website.
The earnings release has also been filed on Form 8K with the SEC.
Samuel Jonas: I would now turn the conference over to Mr. Jonas.
Samuel Jonas: Thank you, operator. Welcome to IDT's earnings conference. My remarks today focus on the fourth quarter and full fiscal year 2024.
Now turn the conference over to Mr. Jonas.
Thank you, operator.
Welcome to IDT's earnings conference. My remarks today. Focus on the fourth quarter and full fiscal year 2024. The three in 12 months and digitalizer refers to.
Samuel Jonas: The three in 12 months ended July 31st. From more detailed discussion of our financial and operation results for the quarter, please read our earnings release filed earlier today and our Form 10-K that we expect to file with the SEC next Tuesday. IDT delivered a strong fourth quarter highlighted by record just EBITDA to cap off our 2020 for fiscal year. NRS boss money and net phone all performed well while our traditionally communication segment business is delivered solid cash flow. At NRS, we continue to make good progress in our strategic priorities, expanding our cost rebates in the large independent retailer market, increasing the penetration of NRS Pay, developing point of sale solutions for new verticals, and building out our advertising tech, all while deploying hundreds of new locations every month.
For more detailed discussion of our financial and operational results for the quarter-pleasered art earnings released held earlier today and our form 10K that we expect to find with the SEC next Tuesday.
I need to deliver the strong fourth quarter highlighted by record just EBDA to cap off our 2020 tour fiscal year. NRS boss money and that phone all performed well while our traditionally communication segment businesses delivered solid cash flow.
At NRS, we continue to make good progress in our strategic priorities, expanding our customer base in the large independent retail market, increasing the penetration of NRS pay, developing pointed sales solutions for new verticals, and building out our advertising test, all while deploying.
Samuel Jonas: At Boss Money, we again achieve year-over-year transaction volume and revenue growth of over 40% during the fourth quarter. Boss Money's economics continue to improve as a business scale, which enabled our Fintech segment to achieve its first quarter of positive cash flow generation. Net phone is steadily building its customer base again, adding approximately 12,000 net new seats, including 2,000 C-Cast seats in the fourth quarter, while also doing a good job of controlling its costs. As a result, net phones adjusted EBITDA margin more than doubled compared to the year-go quarter. We are focused on further improving net phones' bottom lines for continued volume growth and increasing revenue per user.
100 new locations every month.
At Boss Money, we again achieve year-over-year transaction volume and revenue growth of over 40% during the fourth quarter. Boss Money's economics continue to improve as the business scale, which enabled our Fintech segment to achieve its first quarter of positive cash for generation.
Next one is steadily building its customer base again, adding approximately 12,000 net new seats, including 2000 Ccast seats and fourth quarters. I'll also do a good job of controlling its costs.
As a result, Netflix adjusted EBITDA margin more than doubled compared to the year ago quarter.
We are focused on further improving Netflix's bottom line through continued volume growth and increasing revenue per user. Driven by expansion by higher revenue, higher margin, CKS offering, and by migrating customers to premium plans and teachers, including plans with new AI power functionalities.
Samuel Jonas: Driven by expansion by higher revenue, higher margin C-Cast offering, and by migrating customers to premium plans and features, including plans with new AI-powered functionalities. In our traditional communication segment, we significantly improve the economics of our business and began to see the expected pay-offs from cost reduction initiatives we implemented throughout fiscal year 2024. In fiscal 2025, we will continue to pursue opportunities to improve the performance of our businesses and lower costs on maximizing cash flows and reinvesting in customer acquisition. IDT enters fiscal 2025 with strong momentum; NRS, Boss Money, and Net Phone are all profitable, and each has a long growth runway.
In our traditional communication segment, we significantly improve the economics of our business and began to see the expected payoffs from cost reduction issues. Initiatives, we implemented throughout SISC clear 2024.
In fiscal 2025, we will continue to pursue opportunities to improve the performance of our businesses and lower costs on maximizing cash flows and reinvesting in customer acquisition.
IDT enters Cisco 2025 with strong momentum.
NRS, Boston Money, and Ethwin are all profitable, and each has a long growth runaway. In the year ahead, we will drive their continued expansion and invest in new exciting growth initiatives.
Samuel Jonas: In the year ahead, we will drive their continued expansion and invest in new exciting growth initiatives that leverage our strategic assets and expertise. We remain committed to maximizing the cash generation from each of our segments, building dynamic businesses for long-term value creation, and returning value to our stockholders through our investments and new initiatives, share buy-backs, and dividends.
that leveraged our strategic assets and expertise. We remain committed to maximizing the cash generation from each of our segments, building dynamic businesses for long-term value creation, and returning value to our stockholders through our investments in new initiatives, share by best and dividend.
Samuel Jonas: Last year, I would like to thank everyone at IDT who has really worked very, very hard to deliver the numbers that we deliver to you today. Oftentimes, it just looks like numbers on a paper, but it's really a lot of work. Now, Marcel and I will be happy to take your questions. Thank you.
Lastly, I would like to thank everyone at IDT who is really worked very, very hard to deliver the numbers that we deliver to you today. Oftentimes, just looks like numbers on a paper, but it's really a lot of work. Now, more so and I will be happy to take your questions. Thank you.
Unknown Attendee: We will now begin the question and answer session. To ask a question, you may press star, then one on your touch-tone phone. If you are using a speaker phone, please pick up your handset before pressing the keys.
We will now begin the question and answer session. To ask a question, you may press star, then one on your touch tone phone.
Unknown Attendee: To withdraw your question, please press star, then two.
Unknown Attendee: We will now pause voluntarily to assemble our roster.
Enigo Alonzo: Okay, first question comes from Enigo Alonzo with Maurem Capital. Please proceed.
Okay, a first question comes from Anigo Alanzo with Morham Capital. Please proceed.
Enigo Alonzo: Hello, congratulations once again on the amazing results. I had a question first. Well, I have a lot of questions on net-to-phone.
Hello, congratulations once again on the amazing results.
I had a question first, well I got a lot of questions on that to phone.
Samuel Jonas: I wanted to ask about the Meta-Switch end-of-life. Is this going to be a tailwind for your business, or you don't really share the platform that you own with other UGAS players?
I wanted to ask about the meta switch end of life. Is this going to be a tailwind for your business? Or you don't really share the platform that you own with other UK players.
Samuel Jonas: It's not, as far as I know; it has no effect on our business.
It's not as far as I know it has no effect on our business.
Samuel Jonas: And then regarding the migration in net-to-phone from your rented platform to your own platform, how in a percentage, how complete are you with the migration and are you expecting to have synergies there? Yeah, I mean, we expect to actually start migrating more customers over the next quarters. Basically, no new customers go on to any other platform other than our own. And we hope to see savings from it and better satisfaction from our users once they're on the net-to-phone homegrown platform.
Okay.
the
And then regarding the migration in Netsu Phon from the Rente platform to your own platform, how in a percentage, how complete are you with the migration.
and I'll be expecting to have seniorities there.
Speaker Change: Yeah, I mean we expect to actually start migrating more customers over the next quarters. Basically, no new customers go on to any other platform others in our own.
and we hope to see savings from it and better satisfaction from our users once they're on net to homegrown platform.
Samuel Jonas: Do you have any hard timeline ongoing? Do you would like to see the full transition into your own platform?
Do you have any hard timeline on when you would like to see the full transition into your own platform?
Samuel Jonas: No. Okay.
Samuel Jonas: And the last question is about NRS. In previous goals, you have talked about a potential future NRS spin-off. Obviously, market circumstances are not the best today, but what type of circumstances would you like to see in the market and in your own business in order to do the spin-off? Again, I mean, right now we're focused on building NRS into a multi-billion-dollar company. And, you know, when the time is right, have the ability to spin off or do some other type of transaction. However, at the moment, we're very happy with how it's doing internally.
No
and the last question you've followed in RS.
In previous schools, you have talked about a potential future in RS spin-off. Obviously market circumstances are not the best today, but what type of circumstances would you like to see in the market in your own business in order to do the SPN-off?
Again, right now we're focused on building an NRS into a multi-billion dollar company.
And you know when the time is right, you know, of the ability to, you know, to spin off, you know, or do some other type of transaction. However, at the moment, you know, we're very happy with how it's doing internally.
Greg McKenley: Hey, the next question comes from Greg McKenley. Please announce your affiliation and pose your question.
Hey, the next question comes from Greg McKenley. Please announce your affiliation and pose your question.
Greg McKenley: Yeah, good afternoon. Greg McKenley with Asymmetric Management. Couple questions.
Yeah, good afternoon, Greg McKinley with Aismetric Management. A couple of questions. First of all, on the money transfer business.
Samuel Jonas: First of all, on the money transfer business, the looked likely across the threshold there. And we're now even done operating in compositive. Can you help us understand how we should think about sort of incremental margins there now that we've crossed, crossed that line. You know, we're growing very rapidly on the top line. What's your view for margin expansion there? And, you know, what kind of big investments? If any, do you need to, do you need to make there to continue support growth or is it more of a margin leverage business now?
So it looked like we crossed the threshold there and we're now EBITDA and operating in compositive. Can you help us understand how we should think about...
sort of incremental margins there. Now that we've crossed that line, you know, we're growing very rapidly on the top line. What's your view for margin expansion there in?
You know, what kind of big investments if any do you need to make there to continue to support growth or is it more of a arch and leverage business now?
Samuel Jonas: You know, I'm going to let Marcel answer most of the questions, but I will say that from, you know, from a very high level. You know, I don't think that we're, you know, our goal is to expand margins tremendously on a per transaction, you know, basis. I think, you know, our main goal is to make sure that our customers, you know, stay with us for the very, very long term. Even if that means, you know, slightly lower margins, you know, then we could achieve if we, you know, tomorrow if we decided to, you know, to do so.
You know, I'm going to let Marcel answer most of the question, but I will say that from a very high level.
You know, I don't think that we're, you know, our goal is to expand margin tremendously on a per transaction, you know, basis. I think, you know, our main goal is to make sure that our customers...
You know, stay with us for very, very long term.
Even if that means, you know, slightly lower margin.
you know, then we could achieve it with, you know, tomorrow if we decided to, you know, to do so. So, to us it's really about, you know, growing the, the number of customers and making sure that, you know, every time that they think they're sending a money transfer.
Samuel Jonas: So to us, it's really about, you know, growing the number of customers and making sure that, you know, every time that they think about sending a money transfer, you know, they only think about using us.
Greg McKenley: But with that, yeah, and just, just, yeah, think and just to clarify my question, I wasn't really asking so much from a, from a customer standpoint; I was thinking more of the business unit. It looks like it now flipped to EBITDA positive. And so anyway, just wanted to make sure I was clear on that.
You know, they only think about using us.
Yeah, and just just
Yeah, I think it just a clarify my question. I wasn't really asking so much from a customer.
standpoint, I was thinking more of the business unit. It looks like it now slips to even the positive.
Unknown Attendee: Yeah.
Marcelo Fischer: Hi, Greg. It's Marcelo. So, I mean, I think this 2024 was just a fantastic year for both money from all angles. As you see, it's the year that big cross the $100 revenue mark. We are now remodeling 20 million transactions a year on a run rate. It's also the first year that we became both money became EBITDA positive. And you can strongly EBITDA positive. It generated about $4 million in positive EBITDA. And by doing so, it lifted not all the entire think tax segment, which includes also some other businesses, which are much more on investment modes, some of them still pre-revenue.
And so anyway, just wanted to make sure I was clear on that. Yeah, I grab it to my cello. Okay. All right. I mean, I think...
This 2012 Fall was just a fantastic year.
for Bos Mani
from all angles. As you see, it's the year that big cross.
the 100 million dollars revenue mark. We are now doing more than 20 million transactions a year on a run rate. It's also the first year that we became both money became EBITDA positive. And you can strongly EBITDA positive. It generated about $4 million in positive EBITDA.
and by doing so, it lifted not the entire think tax segment, which includes also some other businesses which are much more on investment modes, some of them is still pre-revenue. So, Bob, may have been a great engine for both top line and bottom line growth.
Marcelo Fischer: So, both money had been a great engine for both top line and bottom line growth.
Marcelo Fischer: We finished our budgeting process for 2025. And now, at the end of the year, it has just begun about a month ago. We believe that both money for 2025 will probably deliver more than $10 million of EBITDA. Now, more than double the EBITDA that they generated in 2024. According to all the things that you see, it's the continued around 40% growth both in transactions and in revenues coming both from the digital channel and the retail channel. Now, we continue to see that strength on the top line as we're going to do one in the month of August, September.
We finished our budgeting process.
For 1225, and now, of course, will you have just begun about the month ago. We believe that boss money.
For 2 years to work for 25, we'll probably be the little modern 10 million dollars.
of EBITDA, no module table.
the EBITDA they generated in 2024 and what's driving down is all the details that you're seeing, right, it's the continued.
around 40% growth both in transactions.
and in revenues coming both on the digital channel.
and the retail channel, we continue to see that strength on the top line as we're going to key one during the month of August September, but more importantly, not the leadership of Samuel and Dr. Rara, we really have tackled.
Marcelo Fischer: But more importantly, not the leadership of Shmuel and Luq Pereira, we really have tackled the business in terms of improving operational efficiencies, a lot of automation. And that's time to show itself on the bottom line, on managing that GNA to allow the business to scale at a theft or clip. And our focus actually is going to be shifting a little bit now. Every study new year, not decided to push for continued 40% of growth. But the liberty of our focus on trying to improve what follows is the most important metric in this business, which is growth profit, growth margin for transaction, what we call GMPT.
The business in terms of improving operational efficiencies, a lot of automation.
and that's starting to show itself on the bottom line on managing that DNA to allow the business to scale at a faster clip.
and I'll focus that it is going to be shifting a little bit now and we started a new year. Not decided to.
push for continuous 40% up of growth but a little bit of a focus on trying to improve what's for the earth is the most important metric in this business which is growth profit.
Bruce Gross, Margie Potsson's reaction, what we call GMPT.
Marcelo Fischer: We are trying to make some changes in pricing to generate higher GMPT, even if that costs a little bit in terms of top line growth, but that's going to further yield. OK, better, stronger bottom line cash flow.
We are starting to make some changes in pricing.
to generate higher JMPT even if that cost a little bit in terms of top line growth, but that's going to further yield better and stronger bottom line cash growth.
Samuel Jonas: Yeah, I mean, the one thing I would say is, I think Marcelo might be being a little bit conservative on his projections, but, but again, as you know, I said in the beginning, it's really a question of whether or not you want to have expanded, you know, GMCT or, you know, a longer, you know, lifetime value of every customer. You know, we try to balance that, you know, both having, you know, good, good profitability as well as, you know, many happy customers, let's say, with us for a very long time. Right, I think to that extent, now, sometimes when we think about our official business in many ways, like our mobile top of business, I am to you business, which is part of our, which is our largest revenue business of the corporation in our traditional segment, also the value, you're going to start seeing some very nice growth on the top line. We have made some, some pricing changes to the portfolio, and that's really going to help contribute.
The one thing I would say is I think Marcel might be being a little bit conservative on his projections. But again, as you know, I said in the beginning, it's a really question of whether or not you want to expand it.
GMC or a longer lifetime value of every customer, we try to balance that, both having good profitability as well as many.
Happy customers that they were thus for a very long time. I think to that extent, now sounds like when we think about a sister business in many ways like our mobile top-up business, so I am to you business, which is part of our largest revenue business of the corporation in our traditional segment. Also with that, you're going to see some very nice growth on the top line. We have made some pricing changes to the portfolio, and that's really going to help contribute.
Samuel Jonas: In terms of the overall decline in traditional communications, to be a lot less than what you have seen in the past year.
in terms of the overall decline in traditional communications to be a lot less than but just seen in the first year.
Greg McKenley: Great, thank you, and this is my, this is my first time dialing in for this call, so I'm not sure historically what topics you guys are willing to comment on from a forward outlook standpoint, but you just mentioned the decline in the traditional business. And you think maybe that decline rate of decline will moderate. I wonder, could you comment a little bit on that and then set, you know, how much of an improvement in the rate of decline? And then it also looked like the high growth businesses more than offset the decline in the mature business, so can you talk a little bit about what that means in your view for revenue growth.
Speaker Change: great thank you and this is my first time dialing in for this call so I'm not sure historically what
Speaker Change: topics you guys
Speaker Change: are willing to comment on from a forward outlook standpoint, but you just mentioned the decline in the traditional business. And you think maybe that decline rate of decline will moderate. I'm wondering, could you comment a little bit on that and then say, you know,
Speaker Change: how much of an improvement in the rate of decline and then it also looked like the high growth businesses.
Speaker Change: More than I've set the decline in the mature business.
Speaker Change: Can you talk a little bit about what that means in your view for?
Marcelo Fischer: If you expect that in 2025, and even if you, if you do provide, you know, forward commentary on that, I'm not sure. Thank you. Sure, let me take one thing at a time. Let's have this traditional segment, and then look at the consolidated picture. So, as it's not a new story in our traditional segment, a lot of the most of the businesses there is our legacy, wrong distance voice businesses. Those businesses have been in the client for now many years. We expect the revenues in both the revolution of calling business and also carrier to continue that rate of top-line decline to be double digits.
Speaker Change: Revenue growth if you expect that in 2025 and even if you if you if you do provide you know forward commentary on that I'm not sure. Thank you. So let me take one thing out of time. Let's talk with traditional segment and then look at the consolidated picture.
Speaker Change: So, it's not a new story in our traditional segment.
Speaker Change: I love the most of the businesses there is our legacy.
Speaker Change: Long Distance Voice Businesses, those businesses have been.
Speaker Change: in the client for now many years. We expect.
Speaker Change: the revenues in both the web, the production of calling business and also carrier to continue that great of top-line decline to be double digits. We are managing those businesses for math and efficiency, no strong cash flow generation. Now we do not allocate a different capital towards those businesses. And you saw in Pisco 2012 or before.
Marcelo Fischer: Now we are managing those businesses for maximum efficiency, no strong cash flow generation. Now we do not allocate significant capital towards those businesses. And you see, you saw in fiscal 2024, those businesses, the traditional segment decline, it's even double about $11 million. Now, thinking about for this two years, 2025, both as a result of the large cost-cutting exercises that we did during 2024, they were quite painful, but we executed on them. And, as I had mentioned in prior calls, we are going to start seeing the impact of those cuts into four and beyond. So, as a result of that, as well as what I mentioned earlier, as a result of the fact that the mobile top-up business, I did a list of payments business, which is part of that segment, which is now in a faster growth mode, both in terms of volumes as well as due to very strategic pricing.
Speaker Change: those business, the traditional segment, the client, it's EBITDA by about $11 million. Now, thinking about for this new year, 2025, both as a result of the large cost-curving exercises.
Speaker Change: that we did in 2024, they were quite painful.
Speaker Change: but we added to this on them and as I had mentioned in prior calls we were going to start seeing the impact of that of those girls into four and beyond. So, as a result of that as well as what I mentioned earlier.
Speaker Change: and the result of the fact that
Speaker Change: the mobile top of business, the identity of payments business, which is followed by that settlement, which is now in a fair-to-growth mode, both in terms of value as well as due to various strategic pricing changes. The completion of the cross-cutting and that, you probably make the decline in traditional EBITDA for this coming year to be a lot less than 11 million dollars, maybe around 5 million dollars.
Marcelo Fischer: In pricing changes, the conventional cost-cutting and that will probably make the decline in traditional EBITDA for this coming year to be a lot less than $11 million, maybe around $56 million for this coming year. So, like the public, we estimate about $50 million of EBITDA coming from the traditional businesses. And that leads really to the combined picture, right? I believe that fiscal 2025 will probably see a slight increase in consolidated revenue. At the new businesses, at the growth businesses, start generating more revenue than the declining traditional side. But more important than that, when you look at the bottom line, one of the things that we have been very focused on now for many years is to be able to demonstrate that we are able to increase bottom line consolidated EBITDA every year, despite the fact that our core businesses' EBITDA have been coming down, have been coming down strong.
Speaker Change: I'm here. So like a public big, we asked him about $60 million of EBITDA coming from the traditional businesses.
Speaker Change: and that leads really to the combined picture, right? I believe that fiscal 2025 will probably flee flight, increase in control of the day that revenue.
Speaker Change: Now, at the new businesses, at the growth businesses, start generating more revenue than the declining the traditional site, but more important than that, when you look at the bottom line.
Speaker Change: One of the things that we have been very focused.
Speaker Change: Now for many years
Speaker Change: and we'll see you next time.
Speaker Change: that we are able to increase.
Speaker Change: Padama Line on Solidated EBITDA.
Speaker Change: Every year
Speaker Change: this part of the fact that our core businesses.
Marcelo Fischer: I think now it's about five or six years that we have grown EBITDA on a consolidated basis. We finished 2024 with a record, record $90 million in EBITDA; our Q4 that we just announced today, EBITDA of $25 million.
Speaker Change: even though he had been coming down and been coming down strong. I think now it's about five or six years that we have grown even though on a consolidated basis, we finished $2024, with a record record, $90 million in EBITDA, our Q4 that we just announced today, EBITDA of $25 million. I agree with the company for about more than 20 years. This is our highest EBITDA ever.
Marcelo Fischer: I believe it's about more than 20 years. This is our highest EBITDA ever in IDTC history. And looking into 2025, with all the business of now being EBITDA positives, we believe we could... Definitely, for the 100 million dollars in EBDA for 2025, and the soft guidance. Yeah.
Speaker Change: in the ITC history and looking into 20-25 with all the business of now being we believe we could.
Speaker Change: Definitely for the first 100 million dollars in EBITDA for 2025 and the soft guidance.
Unknown Attendee: Great. Thank you.
Speaker Change: Yeah.
Unknown Attendee: Again, if you have a question, please press star, then one. Okay, we have a couple of questions in queue.
Speaker Change: Great, thank you.
Speaker Change: Again, if you have a question, please press star then one.
Will Carter: The first coming from Will Carter, private investor, please proceed. Yes, on boss money, obviously really strong growth. Again, this quarter, and you know continues, you know, really strong leader.
Speaker Change: Okay, we have a couple questions in cue. The first coming from Will Carter, Private Investor, please proceed.
Will Carter: Yes, on Boss Money, obviously.
Will Carter: really strong growth again this quarter and you know continues you know really strong year. Where are you guys seeing a lot of this growth from our use are you taking share from competitors is this a growth pocket within the market interesting to just understand where that's coming from it's on the larger kind of competitive space.
Samuel Jonas: Where are you guys seeing a lot of this growth from our use? Are you taking share from competitors? Is this a growth pocket within the market? Interesting to just understand where that's coming from. It's on the larger kind of competitive space.
Samuel Jonas: I mean, the truth is, I don't really know. I mean, you know, we do surveys of customers, you know, to find out, you know, who they've, you know, previously used for money transfer. And definitely, you know, most of them have used others. So I guess in some, you know, to some degree, we're taking that distance away from, you know, competitors. I think that, you know, we do a very, you know, good job. You know, cross selling our customer and, you know, amongst, you know, all of our different services. And, you know, making sure that, you know, that they're happy so that, you know, when they're, you know, sitting around talking, they tell their friends about it.
Speaker Change: I mean, the truth is, I don't really know, I mean, we do surveys of customers, you know, to find out, you know, who they've, you know, previously used for money transfer.
Speaker Change: and definitely, you know...
Speaker Change: You know, most of them have used others, so I guess to some degree we're taking that business away from.
Speaker Change: you know competitors I think that you know we do a very you know good job you know cross selling our customer you know amongst you know all of our different services.
Speaker Change: and making sure that they're happy so that when they're sitting around talking, they tell their friends about it.
Samuel Jonas: And, you know, that drives, you know, them to us, you know, as opposed to some of our competitors who spend, you know, wildly on customer acquisition. We really try to, you know, sort of have a, you know, be tame, I'll say about it and really not, you know, overspend. You know, we're very focused on making sure that, you know, as we drive profitable, you know, customer relationships, long-term customer relationships. And, you know, we just make sure that, you know, things work for our customers and that, you know, and that our pricing is, you know, as good if not better than, you know, all of the, you know, competitors that we track against.
Speaker Change: and you know that drive, you know them to us.
Speaker Change: You know, as opposed to some of our competitors who spend wildly on customer acquisition, we really try to...
Speaker Change: You know, sort of have a, you know, be tame, also about it and really not, you know, overspend. You know, we're very focused on making sure that, you know, as I said, that we drive profitable, you know, customer relationships, long-term customer relationships. And, you know, we just make sure that, you know,
Speaker Change: Things work for our customers and that our pricing is as good if not better than all of the competitors that we track against.
Samuel Jonas: And, you know, really the simple answer. Yeah, I believe that the Boss Money brand is becoming a stronger presence in the customers that we're trying to attract for this service. Like until recently, you know, we used to get comments that, oh, you guys at the IEP, you do boss evolution calling. And, oh, I didn't know that you guys also offer a money transfer bill called Boss Money. Now, more recently, they're doing around, you know, we use from customer saying, oh, you guys do boss money when you transfer. I didn't know that you guys also do international long-distance calling, right?
Speaker Change: and that.
Speaker Change: You know, really the simple answer. Yeah, I believe that the boss money grand is becoming a stronger.
Speaker Change: in the cost most that we're trying to attract for this service. Like until recently, you used to get comments that, oh, you guys, at the IT, you do boss evolution calling and oh, I didn't know that you guys also offer a money transfer bill called Boss Bunny.
Speaker Change: I'm more ridiculous than we are out.
Speaker Change: You know, we hear from the company saying, oh, you guys do boss money when you're trapped, I didn't know that you guys don't do it on that long distance calling, right? So boss is becoming a more stronger brand in the marketplace right now.
Samuel Jonas: So boss is becoming a more stronger brand in the marketplace right now. Yeah.
Samuel Jonas: Are there certain payment corridors where you guys feel you have outsized share, or is it sort of across the different quarters between the US and other countries? Well, I mean, again, we today, you know, are almost, you know, almost a hundred percent, you know, US outbound. I mean, we do do it from Canada as well, but it's a small percentage. And I would say that, you know, again, we have some countries that we have, you know, a high share of, you know, transactions too. You know, and our goal is to, you know, try to make every country, you know, a country that we have, you know, a high share of transactions too.
Speaker Change: Yeah, are there certain payment corridors where you guys feel you have outside share or is it sort of across the different quarters between the US and other countries?
Speaker Change: Well, I mean again, we today are almost, you know.
Speaker Change: Almost 100% U.S. outbound, I mean we do do from Canada as well but it's a small percentage.
Speaker Change: um
Speaker Change: And I would say that again, we have some countries that we have high share of transactions too. And our goal is to try to make every country that we have high share of transactions. Obviously, you get to a certain scale and it becomes...
Samuel Jonas: But obviously, you know, you get to a certain scale and it becomes, you know, more, you know, self-fulfilling. You know, you have a big enough share, and customers start telling, you know, each other about it. And we definitely have reached that, you know, in one or two of the markets. But hopefully we'll get to, you know, a couple more this year. You know, I mean, part of the irony is that most, many countries operate in the US. For them, the largest corridor, obviously, is Mexico. And for us at IDT, actually, Mexico is not yet a very large corridor.
Speaker Change: You know, you know, more, you know, if they're self-fulfilling, you know, you have a big enough share and you know, customers start telling, you know, each other about it and, you know, and we've definitely have reached that, you know, and...
Speaker Change: and one or two of the markets, but hopefully we'll get to a couple more of this year. I mean, part of the irony is that most...
Speaker Change: and the United States, for them the largest quarry door obviously is Mexico.
Speaker Change: and for us at IIT actually the Mexico is not yet a very large corridor it's not one of the top three corridors we are going out presence in Mexico so we actually view Mexico as an opportunity at this point to try to get even more market share from some of the building.
Samuel Jonas: It's not one of the top three corridors. We are growing our presence in Mexico. So we actually view Mexico as an opportunity at this point, you know, to try to get even more market share from some of the competitors. I got it. That's really helpful.
Unknown Attendee: And then my last question is on NRS, another amazing year.
Speaker Change: Got it. That's really helpful. And then my last question is on NRS.
Unknown Attendee: Congratulations, guys. It would be helpful just, you know, it kind of may be similar to the overview that Marcelo gave on what you're thinking about 2025. You know, any goals around terminal deployments, kind of revenue targets, and then maybe SG&A levels that will be required to get there. Yeah, I mean, I mean, NRS continues to be value robust. We, we expect, and we have budgeted to continue to grow the network, the POS network by that or roughly about 500 POS is a month, right, 6,000 POS a year, which is what has been the trend for the past few years on a net basis.
Speaker Change: Another amazing year, congratulations, guys. It would be helpful, just, you know, maybe similar to the overview that Marcelo gave on what you're thinking about 20-25. You know, any goals around terminal deployments, kind of revenue targets, and then maybe SGNA level, so it will be required to get there.
Speaker Change: Yeah, I mean, I mean, and I'm rare.
Speaker Change: Continuous to be very robust.
Speaker Change: we expect and we have budgeted to continue to grow the network, the POS network by that, or roughly about 500 POSs a month, right, 6,000 POSs a year, which has been the trend for the past few years on a net basis.
Unknown Attendee: That objective going forward, that's going to be driven by the growth in merchant services, by sending more NRS Pay accounts together with our BOS service, continue to increase the operating levels of the business. I think right now, you're doing about 24% net margins, probably growth, maybe 25% net margins. This coming year is always a balancing act of how much you want to be increasing that margin and the top line by the one growth. So I think we have gotten a good balance, you know, level of investment and growth at the same time.
Speaker Change: That's our objective going forward. That's going to be driven by the growth in motion services, by signing more and a rest to carry your accounts together with our BOS. So please.
Speaker Change: Continue to increase.
Speaker Change: I think we're right now we're doing about 24% net margins, probably going to be 25% net margins. This coming here is always a balancing act.
Speaker Change: of how much you want to be including that margin and the top line by the mangrove. So I think we have gotten a good...
Speaker Change: Balance, you know, level of investment and growth. At the same time, I will not be surprised if EBITDA is called an Arab growth or another 30% is coming here on top of the record 25 million dollars that we delivered for this year.
Unknown Attendee: So I will not be surprised if EBITDA or NRS grows another 30% this coming year on top of the record, 25 million dollars that we delivered for this year.
Samuel Jonas: Yeah, I mean, I don't think I would add to that is, you know, I mean, that, you know, we have some products that we, you know, only recently launched that, you know, we really don't know yet, like I'll say how they are going to, you know, impact our numbers long term. I mean, I can tell you just on, you know, we've launched kiosks and in our stores for doing self-ordering, and you know, we're sold out at them. I mean, hopefully we'll have, you know, more of them, you know, in the next, you know, month or so.
Speaker Change: Yeah, I mean, I don't think I would add to that, you know, I mean...
Speaker Change: that we have some products that we've only recently launched. We really don't know yet how they are going to impact our numbers long term. I mean, I can tell you just on, you know, we've launched Kiosks in our stores for doing self-ordering.
Speaker Change: and we're sold out at them, I mean, hopefully we'll have more of them in the next month or so.
Samuel Jonas: But I mean, you know, so, you know, there are a lot of pockets of, you know, of growth that I think, you know, we'll continue to, you know, make, you know, volume, you know, in every, you know, for what we do in every store, you know, be greater than what it is today. I mean, the interesting thing to me, you know, about kiosks is that, you know, it actually increases the amount of, you know, merchant services that are done in the store quite significantly. You know, I mean, when people are going to a counter and paying, you know, they're much more likely to, you know, pull out cash from their wallet versus, you know, paying at a kiosk.
Speaker Change: There are a lot of pockets of growth that I think will continue to make volume in every First of all, we do in every store, you know, be greater than what it is today. I mean, the interesting thing to me, you know, about kiosks is that, you know, it actually increases the amount of...
Speaker Change: You know, merchant services that are done in the store quite significantly. You know, I mean, when people are going to a counter and paying, you know.
Speaker Change: You know, they're much more likely to pull a cash from their wallet versus paying at a key ask. You know, we launched, you know, our penter, you know, POS, which is our tablet based POS system.
Samuel Jonas: You know, and, you know, we've launched, you know, our PEMPT or, you know, POS, which is our tablet-based POS system, you know, a couple months ago, and it's going very, very well. And, you know, we're about to launch it in, you know, a couple of new form factors, you know, as well as, you know, we're, you know, we're not developing it for iOS as well. And we expect to, you know, launch, you know, pay on the tablet, you know, as well probably by the end of the fiscal year. So there's a lot of, you know, demand, and that will also be, you know, able to be self-sign up, you know, from our website. You can go on.
Speaker Change: a couple months ago and it's going very, very well.
Speaker Change: and we're about to launch it in a couple new form factors, as well as we're not developing for iOS as well. You know, and we expect to launch, you know, pay.
Speaker Change: and say on the tablet as well probably by the end of the fiscal year.
Speaker Change: So there's a lot of demand and that will also be able to be self-sign up from our website. You can go on dot.
Samuel Jonas: You know, you know, fill out a form, either that or, you know, download it from the app store, fill out, you know, a form that comes in the app and, you know, start, you know, doing transactions. And it's also been, you know, a very good product, you know, for our existing retailers to help them, you know, move the queue faster, you know, especially on, you know, on days when they're, you know, busier and, you know, they need an extra register, you know, they just, you know, pull out, you know, a tablet and, you know, start, you know, moving, you know, moving the line.
Speaker Change: You know, so out of form, either that or you know, downloaded from the app store, so out of form.
Speaker Change: that comes in the app and you know start you know doing transactions.
Speaker Change: and it's also been a very good product for our existing retailers to help them.
Speaker Change: you know, move the queue faster, you know, especially on, you know, on days when they're, you know, busier and, you know, they need an extra register, you know, they just, you know, pull up, you know, a tablet and you know, start, you know, moving, you know, moving the line.
Unknown Attendee: So, yeah, those are, you know, some of the new things that are happening.
Max Martiniuk: Okay, our next question comes from Max Martiniuk, private investor. Max, please proceed. Hi guys, first of all, congratulations on the quarter. My question is relating to the remarks you guys said, quote, on there on the desk, quote, deploying hundreds of screens and new locations outside of our independent retail market, unquote. And I think you actually just covered a little bit in the previous question, mentioning the keynotes and the Panther tablets for the screens. Do you guys, is it all POS related screens, or are you guys looking to kind of like offer screens where it's just pure digital of home advertising?
Speaker Change: Okay, our next question comes from Max Martignuk, Private Investor Max, please proceed.
Max Martignuk: Hi, guys. First of all, just congratulations on the quarter. My question is relating to the remarks you guys said, quote, on their on the rest.
Speaker Change: called deploying hundreds of screens and new locations outside of our independent retail market. And I think you actually just covered a little bit in the previous question, mentioning that the key house and the panther tablets.
Speaker Change: For the screens, do you guys? Is it all PLS related screens? Or are you guys looking to kind of like...
Speaker Change: Offer screens where it's just pure digital ab home advertising and the second part of the question is just from the new locations like what verticals are you guys looking at? Do you still see like a lot of runs within your core market or are you guys looking to really expand into the verticals now? Thank you.
Max Martiniuk: And the second part of the question is just on the new locations, like what verticals are you guys looking at? Do you still see like a lot of runs within your core market, or are you guys looking to really expand into the verticals now? Thank you.
Samuel Jonas: Okay, so a bunch of questions there, so I'll try to remember all of them when I give you an answer. As far as the new locations for screens, we're doing, right now, hotel lobbies is actually a big push for screens. We just, I mean, we placed a couple hundred over the past quarter; we just ordered 1,000 more for today for that vertical loan. And as far as new verticals, again, we're definitely trying to go to things that are adjacent to us, whether or not that's hardware stores or quick service restaurants. Anything that's definitely a big focus; we just hired someone to run our liquor store division to really make sure that it's completely customized for everything that they need.
Speaker Change: Okay, so a bunch of questions there so I'll try to remember all of them when I give you an answer. As far as the new locations for screens, we're doing right now, hotel lobby is actually a big push for screens.
Speaker Change: We played the couple hundred over the past quarter, you know, we just ordered a thousand, you know, more for, you know, today for, for that vertical loan.
Speaker Change: as far as...
Speaker Change: You know, new verticals, you know, again, you know, we're, we're definitely trying to go to things that are adjacent to us.
Speaker Change: You know whether or not that you know hardware stores or you know quick service restaurants anything that's skew-based is really
Speaker Change: You know, still our main focus, you know, liquor stores is definitely big focus. We just hired someone to run a call our liquor store division to really make sure that if you know, completely customized for everything that they need.
Samuel Jonas: We continue going after gas stations; we continue testing the waters in some other verticals, but again, QSRs is probably our biggest verticals that is adjacent to where we are now. And, you know, they said, unfortunately, we're sold out of our QSR right now, but, you know, we'll be getting more shortly.
Speaker Change: We continue after gas stations, we continue testing the waters.
Speaker Change: and some other verticals. But again, two SRs is probably our biggest verticals that is adjacent to where we are now.
Speaker Change: Unfortunately we're sold out of our KSX right now but we'll be getting more shortly.
Enigo Alonzo: Okay, we have a follow-up coming from Enigo Alonzo with Mooram Capital. Please proceed. Hey, again, I wanted to ask about the boss money. It looks like you have a way is from your presence in the Northeast with more retailers. I was wondering about the strategy to grow nationwide, and if you have considered tracking in the public information that you released the number of retail locations that you have over the country, and maybe the areas just like you do in NRS.
Speaker Change: i
Speaker Change: Okay, we have a follow-up coming from Anigua Lanzo with Moram Capital. Please proceed.
Speaker Change: Hey again, I wanted to ask about the boss money. It looks like you have a way as from their presence in the northeast with more retailers.
Anigua Lanzo: I was wondering what the strategy to grow nationwide and if you have considered tracking in the public information that you released the number of retail locations that you have over the country and maybe the areas just like you're doing NRS, thank you.
Samuel Jonas: Thank you. Okay, I don't know if we were at least that information or not. I mean, I don't consider it to be a state secret, but we're slightly under 2000 retailers that we do retail money transfer at. You know, again, similar to the comments that I made about, you know, lifetime customer value and GMPT, you know, we're not focused on the number of locations that we have, but we're focused on making sure that the locations that we have, you know, are profitable and are doing a lot of transactions. That's really our goal. Well, we don't want, you know, retailers that do a handful of transactions; they cost us more to have than they're, you know, than they're worth the effort in having.
Speaker Change: I don't know if we release that information or not, I don't consider it to be a state secret, but we're slightly under 2,000 retailers.
Speaker Change: that we do retail money transfer at, you know, again, similar to the comments that I made about, you know, lifetime customer value and GMPT, you know, we're not focused on the number of locations that we have, but we're focused on making sure that the locations that we have.
Speaker Change: are profitable and are doing a lot of transactions. That's really our goal. We don't want retailers that do a handful of transactions. They cost us more to have than they're worth the effort in having.
Samuel Jonas: So, you know, we do open and close a lot of locations, you know, for that reason. You know, however, you know, what I would say is that, you know, we are definitely focused on, you know, growing our retailer base, but the, you know, the majority of the growth, you know, that you're seeing is really in the digital verticals, and, you know, that can, you know, continue to be our main focus, and that continues to be where we're having, you know, you know, a solid profitability, you know, from, so.
Speaker Change: So, you know, we do open and close a lot of locations, you know, for that reason.
Speaker Change: You know, however, you know, what I would say is that, you know, we're, you know, we're, we are definitely focused on, you know, growing our retailer base but the, you know, the majority of the growth.
Speaker Change: you know that your scene is really in the digital verticals and you know that can you know continues to be our main focus and that continues to be what we're having you know you know solid profitability you know from.
Speaker Change: Thank you.
Unknown Attendee: As there are no more questions, this concludes our question-and-answer session and conference call. Thank you for attending today's presentation. You may now disconnect.