Q4 2024 Actelis Networks Inc Earnings Call
Charles: [music].
Good afternoon, ladies and gentlemen, thank you for standing by and welcome to the Telus networks animal 'twenty 'twenty four results conference call.
This time all participants are in a listen only mode. Following management's prepared remarks, we will open the call for your questions if you'd like to ask a question. Please look for the ask a question link on the right hand side of your webcast screen or if he joined by phone. Please press star one when prompted.
As a reminder, the transcript of this conference call will be available within 24 to 48 hours on IR Dot dot.
Dotcom.
Lev: Joining us today from <unk> are two of your bar, Lev Chairman and CEO and Johan <unk>, Deputy CEO and CFO.
Lev: Before we begin we would like to remind everyone that our prepared remarks contain forward looking statements, including but not limited to statements of expectations future events or future financial performance. These statements do not guarantee future performance and therefore undue reliance should not be placed.
Lev: Abundant.
Lev: Although we believe these expectations are reasonable we undertake no obligation to revise any statements to reflect changes that occur. After this call and actual events or results could differ materially. These statements are based on current expectations of the company's management and involve inherent.
Lev: Risks and uncertainties, including those identified in the risk factors section of 10-K and subsequent filings with the SEC All non-GAAP financial measures referenced in today's call are reconciled in our earnings press release to the most directly comparable GAAP measure.
Speaker Change: This call also contains time sensitive information that is accurate only as of the date of this broadcast March 24, 2025 with that I am pleased to introduce I tell this networks chairman and CEO to via Bar, Lev who will provide an overview of our business results and.
Speaker Change: Initiatives following to Vf's commentary, we will review our financial results in greater detail and finally, we'll open the call for your questions <unk>. Please go ahead.
Speaker Change: Thank you operator, and thank you for all for joining US today 2024 was a solid year for entellus develops we delivered excellent financial improvements with the 38% revenue growth of 125 gross margin improvement.
Speaker Change: 57% reduction.
Speaker Change: Our loss per share.
Speaker Change: These results validate our strategic direction and our teams execution ability.
Speaker Change: Our value proposition continues to resonate strongly with the market.
Speaker Change: We help customers modernize and secure their networks.
Speaker Change: First thing infrastructure with a fiber copper coax and deliver same day implementation of fiber great quality without expensive upwards.
Speaker Change: Approach provides immediate value, particularly in time sensitive budget constrained in security critical environment.
Speaker Change: Let me highlight our progress across our three key markets.
Speaker Change: Your orders more than doubled compared to prior year, specifically in the federal military sector, we achieved 150% year over year growth in new orders.
Speaker Change: Following <unk> cyber certification and inclusion in the department of Defense approved product list, we're seeing increasing adoption across military basis and federal agencies.
Speaker Change: With billions in cloud infrastructure updates across defense installations, we're well positioned for continued growth. We also tripled software and services the orders thanks to continuous support and trust.
Speaker Change: Multiple customers and particularly the large north American telecom customer.
Speaker Change: Demonstrate our consistency in delivering quality products software and services to our customers.
Speaker Change: Our Giga line 900 solution family for multi dwelling units and gaining significant market traction with thousands of trials and initial installation is underway in North America and globally.
Speaker Change: Its unique combination of insulin deployment gigabit performance over existing building wiring and ultra low power consumption offers a compelling solution for the last 100 meters challenging <unk> environment and for the owners of fiber infrastructure industries.
Speaker Change: Basement to finally offer services to users and get paid.
Speaker Change: And so I'd say the transportation space, we secured mentioned deployment in cities like Washington, D C, Seattle and various European related therapies.
Speaker Change: Implementation has showcased Ark technology value enhancing urban mobility.
Speaker Change: Safety and operational efficiency.
Speaker Change: Strategically positioned for upcoming major infrastructure projects, such as highways, England, and Rgs <unk>, representing substantial future opportunities.
Speaker Change: 24, we strengthened our hybrid fiber solution portfolio substantially with introduction of our Giga lines 5000, 6000, 7000 fiber product lines.
Speaker Change: Fiber product, that's fiber environmentally hardened highly competitive and integrating seamlessly with our comprehensive <unk> solutions with our cyber aware networking offering and with our AI based <unk> SaaS offerings.
Speaker Change: Our latest Siem solution.
Speaker Change: Even SaaS cyber protection at the edge for all Iot field installations and devices was introduced at the tail end of 2024 as part of our hybrid networking strategy.
Speaker Change: Introduces a unique approach where cyber security calls where the network is built as the network is being built and is utilizing the networks to fixed cyber security issues. This network and cyber protection integration provides operators an effective easy to install tool that protect vulnerable physical Iot devices at the network edge addressing acreage.
Speaker Change: Yeah in the cyber security landscape.
Speaker Change: For 2025, we're prioritizing three strategic initiatives.
Speaker Change: Introduction of <unk> into our installed base with cities roads rail utilities in airports globally.
Speaker Change: We expect this SaaS offerings to generate recurring revenues from industrial subscriptions and integrated network management software to create more predictable revenue patterns and enhanced margins.
Speaker Change: Second strengthening our go to market execution through increased industry presence at key events and development of strategic partnerships with technology companies system integrators and value added resellers and consultants.
Speaker Change: In the federal business, we are working with industry veterans from the military as we alluded to our military customers look for rapid project completion to which we can provide a unique solution through our hybrid fiber approach.
Speaker Change: Navy business in there than last year as well as better connectivity with the army using our state of the R&D line eight Honda solution in a multitude of new opportunities in the funnel.
Speaker Change: In Iot and smart cities, we want the district of Columbia large implementation of over $2 2 million.
Speaker Change: It won't Seattle, Georgetown D wisely in New York and many more.
Speaker Change: These are and will continue to be executed with our trusted business partners.
Speaker Change: In the multi dwelling units or MDU business, we're engaged with Denzel network operators Isps with an integration partners.
Speaker Change: As an initial deployments are underway and we expect those to turn into growth in 2025.
Speaker Change: Third focusing on operational efficiency, while supporting growth, including evaluating selective debt facilities to fund initiatives, while reducing equity dilution.
Speaker Change: The good news is that we're nearly debt free while we managed to reduce our operating expenses year over year by 13%. This allows us to look for ways to increase our debt moderately in a non dilutive way.
Speaker Change: We've also enhanced our board with the addition of two industry veterans jewelry counselor and Dr. <unk> <unk>, who has extensive experience in networking edge computing in broadband technology brings in valuable experience to do that our continued growth.
Speaker Change: With that overview I will turn the call back to you.
Our financial results.
Speaker Change: Yeah.
Thank you to.
Speaker Change: Our financial performance for 2024.
Speaker Change: Inventory significant improvements across all key metrics.
Speaker Change: Total revenue increased 38% to $7 8 million up from $5 6 million in 2023.
Speaker Change: This growth was primarily driven by 134% increase in North American revenues, which now represent a much larger portion of our total business.
Speaker Change: Geographic shift has been strategic and beneficial to our margins and was also boosted by more software and services revenues has to be explained.
Speaker Change: Gross margin improved dramatically to 65% for the full year compared to 34% in 2023.
Speaker Change: This 125% year over year improvement reflects our strategic focus on higher margin segments and the favorable shift in our regional revenue together with an increase of software and services sales compared to the prior year.
Speaker Change: The growth in topline and particularly in software and services as well as its impact on the portion of indirect costs that are typically less variable contributed to higher gross margins.
Speaker Change: Operating expenses decreased by 13% to $8 million.
Speaker Change: Building on the 6% reduction achieved in 2023.
Speaker Change: This cost management resulted from our expense reduction initiatives that started in 2023 and continuing into 2024, which optimize payroll expenses reduced public company costs and increased our real estate footprint, while maintaining our innovation capabilities.
Speaker Change: Breaking down our operating expenses.
Speaker Change: R&D was $2 $4 million down from $2 7 million sales and marketing were $2 $6 million down from $3 million.
Speaker Change: G&A was $3 $2 million down from $3 $5 million.
Speaker Change: We also accepted the 163000.
Speaker Change: And grants in Israel in the year 2024.
Speaker Change: As a result of these improvements our operating loss decreased to three.
Speaker Change: $3 8 million.
Speaker Change: Fair to $7 4 million in 2023 or by 49%.
Speaker Change: Our net loss for the year was $4 4 million compared to $6 3 million in 2023.
Speaker Change: On a per share basis, our loss shrunk by 67% to <unk> 85 per share reflecting meaningful progress towards profitability.
Speaker Change: non-GAAP adjusted EBITDA loss improved to $3 5 million compared to $6 1 million in 2023, driven by our revenue growth margin improvement and expense reductions.
Speaker Change: From a balance sheet perspective, we strengthened our financial position, we repaid nearly all outstanding debt with just a $774000 bank credit line remaining as of December 31 2024.
Speaker Change: This deleveraging has improved our financial flexibility and reduced interest expenses.
Speaker Change: We continue to reduce the open credit line amount in the first quarter or.
Speaker Change: 2025.
Speaker Change: Cash cash equivalents and restricted cash stood at $2 3 million at year end compared to $5 5 million at the end of 2023, primarily driven by our debt repayments offset by equity rates.
Speaker Change: We're evaluating selective debt facilities to support growth initiatives, while reducing the equity dilution with a focus on strengthening our recurring revenue streams to create more predictable financial patterns.
Speaker Change: Looking ahead, we continue to work on executing ways to facilitate growth in our core Iot.
Speaker Change: <unk> and cyber security markets improve our gross margins through the minimization of indirect expenses and higher margins and sales of software growing our more profitable markets, such as federal and military and further optimize our cost structure, including potential outsourcing and offshoring.
Speaker Change: It is where it makes sense.
Speaker Change: With that I will turn the call back to <unk> for closing remarks.
Speaker Change: Yes.
Speaker Change: Thank you.
To summarize 2024 was a year of significant progress for our total numbers.
Speaker Change: We delivered strong financial results expanded our market presence and lay the foundation for continued growth across our key verticals.
Speaker Change: While we made substantial improvements we believe we're just beginning to tap in the vast potential of our target market. The combination of our hybrid fiber networking solutions for rapid deployment at great cost savings and cyber aware networking capabilities uniquely positions us to address critical infrastructure needs across federal.
Speaker Change: Quotation and commercial sectors.
Speaker Change: We're entering 2025 with a strong pipeline and are intensifying our focus on strategic partnerships to accelerate our market penetration.
Speaker Change: The markets. We serve are vast our products are well differentiated with unique value proposition and we remain focused on disciplined execution.
Speaker Change: Capitalize on these opportunities.
Speaker Change: I want to thank our dedicated team for their hard work and commitment our customers for their trust and our shareholders for their continued support we're excited about the opportunities ahead and remain focused on delivering long term value for our stakeholders.
Speaker Change: With that I'll ask the operator to open the line for questions.
Speaker Change: Yeah.
Speaker Change: Thank you we will now begin the question and answer session. If you would like to ask a question. During this time simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question Press Star one again.
Speaker Change: Your first question comes from the line of Theodore O'neill from Litchfield Hills Research. Please go ahead Sir.
Speaker Change: Thank you very much.
Speaker Change: My first my first question is about the results in Q4, there was a sequential decline in revenue from Q3 to Q4.
Speaker Change: And I was wondering what's the driver for that is it something we should expect for the future and.
Speaker Change: How do you how do you manage your people with their kind of swings in business.
Speaker Change: Yeah.
Speaker Change: Yes.
Speaker Change: Yes.
Speaker Change: Can you hear me yeah, So let me share.
Speaker Change: Okay.
Speaker Change: Thank you for your question, it's a very good question. So.
Speaker Change: You know normally our.
Speaker Change: Between our bookings and our and our shipment and revenue.
Speaker Change: The timeline is not very long.
Speaker Change: Are there much in our book and ship business So what.
Speaker Change: What we're seeing is that.
Speaker Change: Our opportunities are still.
Speaker Change: You know lumpy with the larger chunks of opportunities in certain times in and then in other times, we hear them smaller so within the year, it's not 100% predictable, even though we work with.
Speaker Change: Tens of customers.
Speaker Change: We don't always know the exact timing.
Speaker Change: Such a larger.
Speaker Change: Orders when they're coming in and then the shipments that are associated with them.
Speaker Change: So.
Speaker Change: I would say that the better way to look at.
Speaker Change: Our business is more than an average so we saw all in all we had a very significant growth between the two years and.
Speaker Change: We expect that growth to continue, especially since we are exceeding the market.
Speaker Change: And three.
Speaker Change: Very large segments.
Speaker Change: I've mentioned them again, the federal market.
Speaker Change: City Transportation and Iot market and then the MTO market all of those are terrible.
Speaker Change: Tens of billions of dollars, if not more until the market sizes with huge gains that were.
Speaker Change: Uniquely.
Speaker Change: Positioned to respond and then have a remedy and.
Speaker Change: In regards to infrastructure so the.
Morris: The way I'm looking at things as Morris.
Speaker Change: As an average.
Speaker Change: Performance.
Speaker Change: Over time, and I believe that since Oh.
Speaker Change: We're in a growth pattern.
Speaker Change: See more and more customers more and more channels that are generating revenue.
Speaker Change: We will see the Lumpiness just go away over time.
Speaker Change: Okay.
Speaker Change: To your point now.
Speaker Change: On the expense side I note your expenses have been coming down for the last two years.
Speaker Change: Yes.
Speaker Change: Are you at a point now where it's stable or is there going to be I mean, if youre going to have growth next year I would expect there'd be some more.
Speaker Change: Just to go back up but you tell me.
Speaker Change: So let me take that.
Speaker Change: Just to say, it's low hanging out.
Speaker Change: We're spending more and more sales and marketing.
Speaker Change: And we've completed a lot of product development and introduction in 2024, which is all ripe and ready to go and we don't need that much of investment in product.
Speaker Change: Any more but we do want to.
Speaker Change: Drive the market as hard and as fast as we can so we will see more expenses.
Speaker Change: Of course controlled and we're not planning to bankrupt the company, but we will see more expensive and more investment I should say in sales and marketing.
Speaker Change: Because of that is what we want in order to maximize the company's potential.
Speaker Change: Would you like to add to that.
Speaker Change: Yeah, Yeah sure so I'm definitely.
Speaker Change: To get in terms of investing as we grow and we want to focus on those areas were in sales and marketing campaigns, expanding our sales capabilities in the areas, where we put focus for example, federal military is a big it's a big focus of us.
Speaker Change: <unk> multi dwelling units.
Good thing in this core Smith, the shield with our new cyber security solution.
Speaker Change: On the rest of the organization. We tried to we are trying we tried and we continued to try to be very prudent.
Speaker Change: And very conservative in spending.
Speaker Change: King for ways too.
Speaker Change: Sure outsource anything that's non core.
Speaker Change: Anything that can get us more efficient and enable us to focus on investment as we grow.
Speaker Change: We do of course want to get closer and closer and get to breakeven.
Speaker Change: Very soon so oh that is a that is an important element that.
Speaker Change: But we are focusing on.
Speaker Change: Okay. My last question is about.
Speaker Change: It's about the military spending in Europe, it looks like that's going to start ramping up significantly.
Speaker Change: How are you positioned how are you positioned in Europe for benefit from that.
Speaker Change: So.
Speaker Change: Ask your question.
Speaker Change: We have some international military sales.
Speaker Change: But.
Speaker Change: When we say federal we mean the U S with government in the U S armed forces and we treat those from the U S.
Speaker Change: There are deployments overseas.
Speaker Change: We worked out as if they were here.
Speaker Change: Differentiate between the operations that are done overseas to those are done here. It's not my European team that is dealing with is it's about American team.
Speaker Change: I'm not sure if that answers your question that clears it up for me, yes. Thank you very much.
Speaker Change: Welcome and thank you for your questions.
Speaker Change: Your next question comes from the line of Paul a private Investor. Please go ahead.
Speaker Change: Mr. Paul.
Paul: Your line Hello.
Speaker Change: Hello.
Speaker Change: Sorry go ahead.
Speaker Change: We can hear you.
Speaker Change: If I may ask a question about the.
Speaker Change: Your shares.
Speaker Change: Do you see.
Speaker Change: Are you concerned that <unk> will have to do a reverse split.
Speaker Change: Florida stock stock, because it's trending low and on the bottom line.
Speaker Change: There is no such our current plan.
Speaker Change: And.
Speaker Change: We have a.
Speaker Change: A lot going on that we believe will bring the company.
Speaker Change: Into a much better place in terms of share value.
Speaker Change: So at this point in time I, just can say that there's just no such plan.
Speaker Change: Yes.
Speaker Change: Our.
Speaker Change: Gross.
Speaker Change: Perspective, and for 2025, we are driving really hard for growth.
Speaker Change: It should put us in a different place of course, we can never say never if markets are not completely dependent on our performance there depending on a lot of other things, but there is really no no such plans.
Speaker Change: No I appreciate it thank you.
Speaker Change: Thank you very much for your question.
Speaker Change: If there are no other questions from the line.
Speaker Change: We will take.
Speaker Change: Some questions that were accumulated over the webcast. So a question from James Bayou.
Speaker Change: What is the feature outlook for this company financially and business wise do we have to worry about dilution happening in the stock shares anytime soon.
Speaker Change: And also are there any new projects or patents or contract to be made or any partnership for expanding the orange box.
Speaker Change: I think that there are two or three questions here. So maybe you want to start with the last one.
Speaker Change:
Speaker Change: I don't know.
Speaker Change: The snake bitten us as they're listed here so thank.
Speaker Change: Thank you James for your good question, it's a very broad question and I'll try to address the components. In your question. There are listed here so in terms of our.
Speaker Change: Future. Thank you meant future outlook and financial.
Speaker Change: Business outlook.
Speaker Change: So.
Speaker Change: We're in the process of.
Speaker Change: Continued.
Speaker Change: Impact of three major markets.
Speaker Change: So one of the markets is the federal markets with.
Speaker Change: We have multiple success with all the types of armed forces in the U S installations with the Air Force with Navy.
Speaker Change: Some some examples you know recently, we want some some we won business with a with the Navy in Maryland, we complete the deployment with barrick's with.
Speaker Change: One of the major major partners into federal.
Speaker Change: In military basis, we're talking to all the branches of the U S military and federal government and has enough to show for.
Speaker Change: To show them, how they could just.
Speaker Change: And you know use whatever they have they don't have to re run fiber or they don't have to wait for for permits for <unk>.
Speaker Change: Machinery to come in and run Civil works.
Speaker Change: We have an interesting example of one of our sales guys that went into major base here in California Air Force base.
Speaker Change: Many many tens of miles just the size of that base and they were waiting for more than eight months to get a permit to run fiber to connect certain locations.
Speaker Change:
And Mike I went in with some demo gear.
Speaker Change: And he didn't mean to but by lunchtime they were done connecting four of those sites.
Speaker Change: And went to have lunch after with.
Speaker Change: A very small fraction of work that would have cost them. When the time was like immediate like now so with military it's it's there.
Speaker Change: Text to us I mean, we're interested because it helps us get things done.
Speaker Change: Clearly it also saves a lot of money in budgeting and.
Speaker Change: It kind of works also with the fact that they may be under some scrutiny enough for savings.
Speaker Change: It's really a way to help modernize those basis get them into the.
Speaker Change: Digitization modernization phase with turning those.
Speaker Change: Many many locations where they're connected still with the sub megabit non cyber safe connectivity.
Speaker Change: Oh over wires and give them that that gigabit grade cyber safety.
Speaker Change:
Speaker Change: Connectivity they need today in order to modernize their basis. So that is one market and we're all over it and were invested really really deep into developing it.
Speaker Change:
Similarly.
Speaker Change: We have.
Speaker Change: The Iot market, which we call sometimes it's critical infrastructure market that is the market, where we were in cities and in rail systems and highway systems utility companies campuses universities colleges and so on.
Speaker Change:
Speaker Change: Our offering here.
Speaker Change: It's almost the same and conceptually it's different from from a product perspective, but it's almost the same.
Speaker Change: The city work with infrastructure. It has if it has fiber in place wonderful, we'll give them fiber gear. If it has copper that's wonderful to work with our copper and make it a fiberglass if they have coax will go the same so take whatever you have take that component that normally is 60% of more or more of a project of upgrading of CIT.
Speaker Change: Due to the new generation of Iot devices, AI and so on a unit productivity. That's the basic component and we are helping.
Speaker Change: Those are hundreds of cities that were deployed with get there within no time and in a huge amount of savings. A nice example is our recent win with the Washington D C.
The Ddos.
Speaker Change: <unk>, which was announced in 2024 with over $2 million of deployment across the city.
Speaker Change: We had them for a while those were all the customers that we work with them in the past, but this one was the biggest project and I think it will.
Speaker Change: It took us into a place where.
Speaker Change: Well, what we can say proudly that we have.
Speaker Change: <unk> helps.
Speaker Change: One of the most important cities in the world.
Speaker Change: And in this particular market.
Speaker Change: As I said, we're already in hundreds of cities major cities.
Speaker Change: Sacramento.
Speaker Change: New York, London, We've announced all of those.
Speaker Change: In the past and there is more and more happening.
Speaker Change: We have.
Speaker Change: Large projects such as the and.
Speaker Change: And our teeth project within the UK highways, where we're providing the communication for all all the high was in the UK.
Airports are.
Speaker Change: Mobily and we believe this market is moving forward moving faster AI is driving components that makes them move even faster than that and.
Speaker Change: With those capabilities.
Speaker Change: Capabilities that we're enabling we'd take out the pain of infrastructure infrastructure is.
Speaker Change: The major major component of our of time and money to spend on making those things work and are adding to that our ability to protective once encrypted safe.
Speaker Change: Safe.
Speaker Change: But also now able to protect its environment, so with the introduction of meta shield.
Speaker Change: As our SaaS offering that comes with a network. They are building the network and they are building the offering of cyber protection of entire operation with that.
Speaker Change: Capability and of course for us it's a for US it's a sale of our software and SaaS into our existing installed base and then it goes beyond that into of course, other people services and systems as well.
Speaker Change: So that's the second one.
Speaker Change: Second vertical and the third is the MTO market. The MTO market. We've introduced a set of products we call. It the Giga line 900 product family.
Speaker Change: Enables oh.
Speaker Change: Owners of fiber for the most part they also brought fiber near buildings into neighborhoods, but not to the end users maybe two basements, but now they have a problem connecting to end users in the MD use because it's very very difficult to tear the wires out and are building, especially if it's an old legacy building and rerun fiber there so.
Speaker Change: How do you given the gigabit said everybody wants to go without investing that much time and effort and money and without having to handle landlords and making sure. All the tenants that are at home when you do that.
Speaker Change: Very difficult we know over there is over 10 million such MDU buildings in the U S alone we know that in many markets. There is a number I got recently about 2% penetration in Germany.
Speaker Change: In into M. D use of fiber services much less in countries like U K. So we ended up in a position where.
Speaker Change: This gap between people, who ran fiber and everybody's talking about the winner run fiber that scope of passerby buildings, and then where do you take it from there how do you make money off of it. So finally, we haven't we have a solution that is connecting through the fiber that is near to building or outside of building and then using infrastructure available there.
Speaker Change: To to wire gigabit services into the M to use on existing infrastructure coax or or copper.
Speaker Change: And doing that while consuming only some five watts. So no need for special power provisions you can you know even buried out in the garden outside.
Speaker Change: Slap it on the wall of a building and then you have that.
Speaker Change: That problem resolved without the need to involve landlords without consuming much energy and then.
Speaker Change: Basically provide a solution for it for a really.
Speaker Change: Large market that's not in trouble. So these are the three things we're coming into the year with and other than the product themselves. We've signed up a lot of partners.
Speaker Change: Customers aren't trials.
Speaker Change: All of that is driving towards growth, it's hard to tell exactly how much we have our plans of course, but we're not providing at this time forecast.
Speaker Change: But definitely the growth and hopefully a rapid growth and this is where this is how we're looking forward towards starting this year.
Speaker Change: Some products already a lot of the work will be in marketing and sales and channels and partners and driving those.
Speaker Change: So I don't see what what's your next question is.
Speaker Change: Dilution.
Speaker Change:
Speaker Change: No.
Speaker Change: The Ocean happens when we raised.
Speaker Change: Equity.
Speaker Change: We cannot say that we will not raise equity we may need to raise equity we're looking at raising debt first if we can because that is a non dilutive and we will need more money, we're not breakeven yet hopefully will be.
Speaker Change: Within within sight.
Speaker Change: Breakeven, but at this time, we're not yet so we may need to a guarantee that we have enough equity and.
Speaker Change: And at the same time.
Speaker Change: Try to fund much of our operation as possible through that.
Speaker Change: Oh I think that's the second question you have here.
Speaker Change: So Oh, let me also chime in for a second to be regarding the debt versus equity.
Speaker Change: You've seen that we've repaid nearly all our debt.
Speaker Change: Basically the first time in <unk>.
Speaker Change: Quite a number of years, where the company is nearly debt free.
Speaker Change: And.
Speaker Change: We can actually do a bit more not not at the level that we were used to.
Speaker Change: In the past but.
Speaker Change: To the tune of maybe a couple of million Oh that would minimize dilution.
Speaker Change: Yeah.
Speaker Change: At any rate possible, so we're going to pursue that.
Speaker Change:
Speaker Change: Pursue that for that purpose.
Speaker Change: Thank you.
Speaker Change: So James.
James: Do you have additional questions here are there projects, so patents or contracts for partnership so.
James: And in 2024, we've announced a partnership with a company in the cyber space, which enabled us to develop our unique metal shield offering and then patents are in the making for the technology that we're introducing in the answer the MDU market.
James: There Theres no patents so all the time and this is this is the main focus at this time.
James: In terms of contracts we are partnering.
James: Partnering with different types of of <unk>.
James: Partners. So one type is the solution providers, because we have access to so many customers and accounts. We can integrate solutions that are broader and can bring technology into our offerings. So offering can grow.
James: This may include.
James: Specialized a specialized fiber products specialized satisfied that these are things that we can bring into our solution because our message has as we stated it.
James: When we took the company public was that we want to be everywhere in terms of infrastructure. But then we also want to use that installed base to go up the food chain. So more software more services more edge.
James: And that is happening as we speak of course, we have multiple partnerships with with.
James: Integrators and companies, who push us into the market and their representatives. This is all growing over the last I'd say since we went public.
James: We probably added tens of partners.
James: In.
James: All in that that that category of people, who help us get into the market. So advisors representative channels partners integrate as far as.
James: This is all a growing and adult.
James: Adult taking time.
Education penetration into many markets.
James: But that's the machine we're building and this is why we're optimistic about its growth on growth prospects.
James: I think this is this is covering your questions.
James: <unk>.
James: Okay.
James: The next question.
Speaker Change: The next question from Patrick Beekman, I'll, just read the one that has not been answered yet.
Speaker Change: We are weary from previous deals with Q I N D and toxic large shareholders.
Speaker Change: I'll I'll take this one so first of all Q I N D. We we determined after extensive exchange and.
Speaker Change: And dealings and due diligence that this is not the right deal for our shareholders. So the.
Speaker Change: The deal has not been strokes, we walked away.
Speaker Change: And.
Speaker Change: And this is behind us.
Speaker Change: Toxic large shareholders I don't think that we have.
Speaker Change: Such ones otherwise.
Speaker Change: You could you could see them in the in the.
Speaker Change: The 10-K, but we don't have those.
Speaker Change: Those that I can.
Speaker Change: That I can mention here.
Speaker Change: Hum.
Speaker Change: In that context.
Speaker Change: Context.
Speaker Change:
Speaker Change: Ron Kaufman asks when do you expect to see initial revenues from cyber where networking meta shield.
Speaker Change: Is it something that's already being shipped or is it still in development.
Speaker Change: So I'll take that yeah. So.
Speaker Change: Meta shield has been it's already a product it's not.
Speaker Change: It's gone into plan, it's actually.
Speaker Change: Being driven into the market. It was introduced at the tail of 2024.
Speaker Change: And we are currently in discussions with our customers.
Speaker Change: Customers small and large in multiple countries and we expect our revenue in 2025, probably a second half. It's a SaaS service. It takes time for customers to trial to test and its cyber security, so theyre cautious and introducing such measures into the network. So we believe that it's going to be generate.
Speaker Change: Revenue this year.
Speaker Change: Clearly not a major component of our revenue because again it SaaS it's building relatively slow.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: The next question is from New York and on rescue.
Speaker Change: Are there any steps the company is taking.
Speaker Change: The strength of it strengthen.
Speaker Change: Its market positioning from a sectorial standpoint in terms of winning more or larger projects in federal.
Terry: Terry markets.
Speaker Change: Right.
Speaker Change: So this is one of our main markets to develop in 2025.
Speaker Change: We already announced.
Speaker Change: Partnerships with.
Speaker Change: Hum.
Speaker Change: I'm, a little worried about mentioning something that we ever in your release, but we.
Speaker Change: We have announced the wins in 2024 with major partners in the market.
Speaker Change: And this will continue.
Speaker Change: We're expanding on our partnerships, we're spending on our advisor network and we're reaching those parts of the military and the armed forces that are.
Speaker Change: Approving those designs.
Speaker Change: And if we use a term from from from Telecom. This is a narrow network network planning department that will bless this design and introduce it into the market in 2024, we have.
Speaker Change: Being able to get certification from the <unk>.
Speaker Change:
Speaker Change: In the military which.
Puts us in a position that were.
Speaker Change: As they call it.
Speaker Change: The only cyber safe system of its kind with the military can use military and our forces and this adds added us through the approved vendor list.
Speaker Change: And.
Speaker Change: Again, that's the only solution and now we're.
Speaker Change: Working across all those armed forces very intensively.
Speaker Change: To.
Speaker Change: This grant cover of operation in terms of everybody needs. It there's really no one one.
Speaker Change: Section of the military that has.
Speaker Change: Everything covered with fiber to the contrary.
Speaker Change: It's almost a sometimes it's almost strange to see how much how much there is to do in order to upgrade and modernize military infrastructure and.
Speaker Change: And millions of locations.
Speaker Change: Great.
Speaker Change:
Speaker Change: Last question is from.
Speaker Change: From Yadkin on rough call.
Speaker Change: I'm, sorry from Ron Kaufman.
Speaker Change: Again company previously mentioned it is well positioning position substantially play a role in the next phase of in Rts.
Speaker Change: When can we expect an update.
Speaker Change: What would it look like.
Speaker Change: From a dollar value.
Speaker Change: So and Rts is a project of upgrading and modernizing UK highways.
Speaker Change: We have been selected with our partners.
Uh huh.
Speaker Change: To provide a component of communication component over fiber over copper.
Speaker Change: And and and.
Speaker Change: Possibly over over coax for the cameras in the future that is a large project.
Speaker Change: We believe that again. This is this is our estimation.
Speaker Change: Hold me to it I think it's it should be in the $20 million project.
Speaker Change: Overall, our we've already and deploy the first phase first phase was.
Speaker Change: It did we did we mentioned that number to the public health I don't remember if it was several million dollars.
Speaker Change: And yes.
Speaker Change: We're waiting for the next phases did recently stated.
Speaker Change: We did we did.
Speaker Change: Okay, Yes, so well we talked about the fact that it was about between $6 million to $7 million of the first phase.
Speaker Change: Right. So so those those next phases are really dependent on the U K government and when they are ready to launch them.
Speaker Change: But we fully expect them to happen.
Speaker Change: With that it's really hard for us to tell when they will actually approve it. So it might be this year might be next year might be the year. After we don't know and would not want to mislead you.
Speaker Change: So operator is there a last question from the phone line.
Operator: Yes, we have our last question from Mr. Yang Paul Private Investor. Please go ahead Mr. Paul.
Paul Yang: Yeah, Hi.
Paul Yang: If I may ask just a that is stupid question again.
Paul Yang: Are you expecting 2025 to turn profitable.
Paul Yang: Yeah.
Paul Yang: Thank you for the question, it's really a good question, we would love for it to turn profitable.
Paul Yang: We believe that with our investment.
Paul Yang: That we're investing in them in developing those markets.
Paul Yang: It might but I cannot guarantee that so with that you know we're not providing those those forecast forward, we're driving really hard to become profitable, but it's really hard for me to commit that it will happen in 2025.
Paul Yang: As you could see from from what we've done between 2023 and 2024 are lost wound down significantly and we expect this to have to keep happening.
Paul Yang: It doesn't take much for a company our size to win a contract that will make it profitable, but those are large contracts and the timing of them on them is it's not always known so it's really not.
Paul Yang: That's something we can commit to at this point.
Speaker Change: I appreciate it thank you very much for answering.
Paul Yang: Very welcome.
Paul Yang: Thank you very much operator, I think that at this time, we're going to wrap up the call.
Paul Yang: And we really appreciate the support and the trust with everyone who is a.
Paul Yang: Shareholders, and and Audios is giving and are providing us and.
Paul Yang: And thank you very much.
Paul Yang: Okay.
Paul Yang: Thank you all for joining today.
Paul Yang: Appreciate your time.
Paul Yang: Ladies and gentlemen, this concludes today's conference call. Thank you all for your participation you may now disconnect.
Paul Yang: [music].
Paul Yang: Sure.
Paul Yang: [music].
Paul Yang: Okay.
Paul Yang: [music].