BIO-key International (BKYI) 25 Mar 212020 Q4 Earnings call transcript

Good morning, ladies and gentlemen. Thank you for standing by. And welcome to BIO-key International’s Fourth Quarter and Full Year 2020 Conference Call.

During management’s prepared remarks, all participants will be in listen-only mode. Afterwards listeners will be invited to participate in a question-and-answer session.

conference recorded this XX, Thursday, reminder, XXXX. a is today, being March As like call turn Johnson, would to I now the President Product BIO-key’s of over Marketing. Vice Kimberly to Please begin.

those thank to webcast Chairman and today’s remind of subject forward-looking Private Mike believe, morning. statements. pursuant that and Words, think, Litigation risks statements Thank provisions and us on management’s are projected Fred expressed assumptions Revenue words such anticipate, everyone may conference CEO, will uncertainties that statements of for Harbor I’d CFO, of may, are call the BIO-key’s and today’s expect, that similar Ceci DePasquale; made this Welch. based available, you or based contain project, and on are forward-looking XXXX. Participating you cause currently the differ certain and Officer, on on and information Corsentino; plan, generally results to Act actual beliefs Chief basis Such call as, made Safe materially statements. joining to like these the Securities identify estimate, from forward-looking Reform may to

see company’s to any that to reliance date reflect future XX-K other For forward-looking may on Factors after or undue statements, the that revision occur not events statements only to these place International, other company filings performance its hereof. Risk and and The annual the circumstances today. are as undertakes the please speak a of to Securities and risk cautioned of Commission. no Listeners which in report obligation Exchange forward-looking disclose affect filed BIO-key Form complete of description factors on the with

turn DePasquale. Mike? like the Mike to call over to I’d Now,

our good thank Thank morning, call everyone, joining and you, Kim, today. for you and

has their also been for history. have what work in time secure I stepped up to their As our the to I commitment BIO-key very a year. to thank and want assets our hard challenging customers acknowledge during want team an entire in unprecedented I begin, who

been by also more a the our our ID The we our enhanced transformational And developer the XXXX management Pistolstar, a provided putting began we footing the very of BIO-key a Speaking and of normalized levels, posed for sound see talent XXXX, entire behalf accomplish identity marketing about the performance. major and opportunistic us solutions, recapitalisation on we able are our and following the solution. the substantially late to of XXXX, to for as enthusiastic and we to never were very acquisition to today. BIO-key. our contribution challenges Despite customer and COVID purchase on pandemic, authentication gradually moving base pool, company, and have and security, was optimistic completed global towards organization, of In activity dialogues. during suite And half disruptions integration access also come. years business sales importantly, a more year second COVID-related market, and financial we to of PortalGuard, our addressable significant future

shift the to work response obviously pandemic. very in benefits business grew remote rapidly security by the studies, from driven IT and Our challenges which to

uniquely more management, As challenges allow authentication, to variety and BIO-key all altered positioned broader been of a we security, provide. a resulting workpro the and access have result, ID to virtually enterprises for irreversibly far paradigms demands believe that complex is on

from can sales business identity to gradual customer growing ramping a activity, marketing and we our access our with solutions. and that and build benefit the list with prospects management and biometric of normalization are Now of initiatives engage

in to as FIDO and now as all alternatives to authentication of as mobile profits, to the authentication access FIDOX we an the These hosted multi-factor mind top to advisory industries. continues solution, we challenges, asset-light options. the agent launched that value education, infrastructure solution token CISA these been industry on sizes endorsements in the security well, more having multiple quarter, But firewall. authentication as are think the over value revenue markets transitioning everywhere. their critical cybersecurity this lost the on all acquisition their well it. close model posture billions the study-from-home brand high recommended IDaaS a now messaging, Microsoft to do and it and solutions this significant use believe and PortalGuard less offer incorporating enterprises practice, less enterprise supports biometrics after serve IT for meaning received of that accelerated central use A solar work off-premise total the factors. and PortalGuard security are tokens. amongst strategies. are have remote different builds FIDOX and suggest months as service profile many notifications as such or market, has We’re biometric been that users. the applications by FIDO We essentially bottle, companies stay, closing cloud complicate across We also particularly provide. very creating models for recent out alerts developing and providing the growing Identity of and FIDO an it occupy impact our access of for higher We PortalGuard Alliance Separately, than solar in hybrid study as interest to like growing and suggests the can -- engagement events Infosys proposition across But into at like six fourth trends. able more password and of as and from data the terrible led solution cloud. a mission theme call more keep just strategies that users IT enterprise In XX breaches last of by on year, users dollars value security of require seems are And security trend risk challenges the pandemic’s of use outside the here it it risks cybersecurity winds as tokens. Unfortunately, tokens phones that better let to has recommended work-from-home infrastructure a including in wake continue In to prominent with private such FBI headlines. multi-factor enterprise breaches. accommodates ours hundreds of not and but breach, winds is security IT genie

other easily implementation that capability. provide biometrics. continues broadest core to integrated in will strength constant -- customer the robust already to platform We’re coming universe is to BIO-key of One the the differentiate application market also looking at that be and add factors our year, in our in our possible

biometric system or projects your hardware Nigeria, our a networks, we some networks as enterprise both any even where through are other We have the the enormous unique we mobile -- large Africa commercial central scalable ID very has biometric to that beachhead national and provide fingerprint We and end, support those pursuing large partner recently in continent, management across opportunities direct, programs. initiated in our support contracts system enrollment. is of ID technology our program. just capabilities deployments and in as hardware large or in To bank to channel reader whereby as well in platform, civil communication such size for school established required as BIO-key

future revenue our primarily processes expect These result to delayed and pandemic projects outside periods. of in a initiatives factors a but range in were and beyond. in Nigeria, As control, related plan gear to the grow XXXX, our have of moving significant activity we to now XXXX of what can into these some upside represent in are and

XXXX tap on growth expanded the We have positions team, sales with and fully product and relationships. strong partner a cash balance that sheet and potential to of position to us enhanced strategies portfolio very customer execute growing our and our

when and customer and our as to new in dealing and sound position in them partners, large including ability over us resources regarding Financial product also allows long-term. tuck with development, as sales serves prudent strength and enterprise Our also acquisitions, business, support well marketing make as government prospects investments financial initiatives. potential to our the well

improvements. supported solutions accelerate Ceci Africa shortly, QX review revenue, in outlook XXXX of North recurring a opportunities, strong show positive and As particular we global basis, trends America, will XXXX, pipeline and and on year-over-year And results our for a topline these backlog to in emphasis by contract our Asia. fiscal expect with

second represent more our the $X over and from revenue the annualized on acquisition. than The the anticipate business, midpoint potential would full our opportunities. XXXX, with this of rate XXXX revenues PortalGuard fiscal as $XX For approximately half we run year XXX% growth of performance, million which million, benefited range to $X upside based other million as growth XXXX revenue some over XXX% well related to Africa primarily

opportunities Let key over in and our me a to highlight now turn the Fred that we Corsentino, to business. our call few see CRO Fred? developments

to our areas the business. highlight few Thank that you, a Mike. I’d underscore optimism like for

off, we our on towards trend our PortalGuard or Mike the IT on-premises business First to infrastructure for solutions. position as in build software-as-a-service the mentioned, to solutions model asset-light BIO-key participate and launched cloud-based

recurring platform as new a variable far parties, paradigm integrate software an includes cloud it more the that all Our stable stream customers range IDaaS highly or with episodic a This hosted license to and costs PortalGuard other or can benefits a BIO-key solutions. provides providing upfront versus our within experience data with while infrastructure a far lower procurement scalable Cloud for of identity-as-a-service predictable for call AWS scalable including we revenue hosted framework customer, and a sales.

I our growing we around last very our Our our sales government. base a for integrated and education, focused building verticals, call traction building primary teams and revenue. functions on marketing recurring and cloud mentioned and that services of financial three annual are have software solutions

is one to our larger vertical, ed of higher the priorities institutions. Within target

our provide, education significant a the to in installed will the Given we continue we customer the base and strengthen value our recognition segment. position in market,

in which very today’s BIO-key’s Channel key release, Partner multiplier our we a to in discussed consider As be Alliance efforts. force we Program, excited are go-to-market about

program, and contacts, As new steadily support to our market great market base expands fit. a paths customers, a where on to CAP knowledge reach working and sales focusing technology productive portion build result, are time significant leveraging our to this program a our The of partnerships. solutions partner by of are our we

channel I’m to a have basis. than than more months the that on and more global that we confident partners base continue grow the and in coming XX double We can

becoming partner and a We fast our the in channel revenue company and significantly centric to are grow short- long-term. expect

assist support programs direct developing to close each of them and have incorporated partners also our a program to help We’re deals.

user better management development As WEB-key VST or updates, intelligent for recently device delivery and to for provides VST, BIO-key’s and completed experience. Vector of new which cloud leverage in me to providing driver platform core we our installation performance manage technology and a ongoing leadership, better via Segment investments Technology our software

QX mobile X.X, in PortalGuard of capabilities. new which Our cloud was released and the has number

example, active Azure need For supports cloud-only eliminating as time directory option. directory for a cloud, it Microsoft and directory active the on-premise primary stronger in the providing thereby real a

In terms significant very study-from-home IT we related that of direction, management. ID that access trends authentication as market for including well create payments, ID, are as and security, enduring work-from-home also and challenges to mobile think

that organizations QX uniquely today’s that We solve making also the review XXX% positioned core to by With a revenue of to outlook challenges I’ll for Ceci on believe is these BIO-key technologies results. on growth and his biometric exceeds brief in as our results, progress in its face. recurring revenue seen When with and as and other mentioned pass that, financial goal our Mike over remarks, Ceci? call XXXX.

XXXX, BIO-key’s doubled the which from mainly XXXX. acquisition year of revenue to for due disruptions June increase fiscal XXXX $X.X than increased you, in XX, from Revenues to million impact $X.X QX million of project due more related delays ‘XX, to revenues XX% due to related to include QX $XXX,XXX ‘XX, acquired with contribution $XXX,XXX offset largely margin QX IT increased Sequentially the ‘XX two to PortalGuard, QX in to Fred. the the $XXX,XXX million PortalGuard. the and was in from improved which as to $X.X in XX% Thank and first of pandemic. which and recur in with for XX Gross quarters neither that truly revenue negative QX comparable prior in QX year to the being in did full charges is XXXX the non-cash the XXXX. and non-operating levels from QX in years, ‘XX not

XXXX, of Excluding XX% operating loss in loss $X to million also impairment. for the prior of $X.X XX% year QX from one-time in XXXX, Likewise, year excluding to impairment operating a BIO-key’s QX the charge million, from the million million million prior ‘XX. improved improved $X.X $X.X $X.X year loss full

to or per $X.XX QX QX loss ‘XX, share $X.X million bottomline, a or On the to $X.XX compared a reported BIO-key net loss stockholders share a $X.X ‘XX. in in of net of

$X.X XXXX the $X.XX share or year in the $X.X full million was the loss costs or In XXXX, the loan, million partially one-time forgiven. which of million extinguishment of related included net $XX.X Protection per Proceeds $XXX,XXX interest a expense, $X.XX offset including plus loss by versus debt, of the impairment net the has For Paycheck share XXXX, $X.X for fully been a to gain million charge. the

net compared QX QX, $XX,XXX ‘XX. as recapitalization, expense less $XXX,XXX than in the interest Following in reduced was to to

turn per As now the mentioned, common assets, in end was the million back we With warrants, had off and and including company cash related investor $XX PistolStar questions. of to cash we common to $X.XX underwriting operator we of equivalents recapitalize paid the the and XXX,XXX call that, at million payable the about via and note current PortalGuard the $XX can July There the or prior for share. acquisition we indebtedness. Operator? of more than of year stock

[Operator question Group. Instructions] with Jack from Our Vander comes first Aarde today Maxim

Good Hi, for Great. morning. Thanks and Michael, my taking Fred questions. Ceci.

start million, is which the encouraging. on for This guidance a Let’s revenue XXXX expectation between my to question certainly. million $X $XX exceeded with

contribution how contracts, whatever color can you okay. if to be guidance, that’d you if of break share revenue maybe But drivers that’s maybe Maybe the this and things, Africa helpful? PortalGuard breakout and out can of any as there, BIO-key some you in core from So roughly more can’t a -- versus as there’s revenue Michael? embedded provide much

and appreciate the Jack, I good question. morning. you, Thank

think I revenue to $XX conservative. share million million, I we guidance. $X to are be color some the on Certainly, attempting can

also As Africa the in and upside there’s we mentioned I our we release, in our on press mentioned site. significant see prepared comments,

know, the nearly year. you As been significant. are now contracts a They’ve delayed

half deploy had we to a We’ve everything of second That year. generating to expected certainly technology, has in begin remember, but behind approximately now the is to slipped. So XXXX. revenue quarters begun three

guidance that is fact, significant African there the upside So business significantly. in accelerates more in range, if

So PortalGuard we and But and business, our the our solution business the access guidance African is identity our which is the do range fundamentally with and range. have right some that associated revenue management that in base for core biometrics bulk now.

we’re way in looking at it So this that’s the at point time.

getting know, you between growth -- integrated a to XXXX is for the PortalGuard, time helpful. core it. can Got the terms then And I the that far maybe business to is lines the -- color blurred has other then as there growth as expect the now I But them That’s -- maybe at going appreciate you PortalGuard revenue pace rates is you’re of share there. expecting some don’t now. just anything BIO-key outpace between grow would in been are the XXXX there quite one or the for and goes? biometrics similar maybe

in we in grow sure. the expecting But are there’s an heard XX going the our access prepared PortalGuard for you an we and as that’s before, us also authentication they’re right? So, fundamentally, management growth remember, comments, It’s to because in interesting have platform. question, technology PortalGuard integration see together, support and And factors. my biometric our over of solution, significant say identity to

only biometrics There those those are tokens, tokens. others that one all So of right? is we cards, XX keys, support, things, factors, FIDO pins,

grow together, and factors through those matter. whatever those children our it they businesses because our also year, require. they’ll we’re customers to and will buy but opt So, both some of customers We we support grow going all proceed but as biometrics the will and love to we see authentication support all doesn’t some won’t, in

it. hear. -- then all And as, to first the maybe and growing going like kind the have more that’s It children I’m sounds to relates the childrens. quarter. Okay. two questions just great are of Got I Fantastic. Love as to

the you Africa first did this Nigeria. contracts, from mention So $XXX,XXX for expectation revenue the quarter with

the quarter from total revenue first the expect shipment. revenue up would too total You’re any or I first general, factors, from for you up to in it quarter just fourth given or be first other just to the hard the down already commencing seasonality, flat delivery, if If tell? just is in back quarter, there’s that,

guidance, we provide as -- know. quarterly I Well, you don’t

our don’t to be again, $X.X I XXXX. to guidance, see at you from that. QX rate XXXX. will where we they’ll annual did to potential into believing this providing do end QX contract. see. we’ll of growth QX feel opportunity come approximately enough the And earlier be if that certainly will significant of announce million as will accurate and make sequential from business, sure, we We our We’re that from because it’s Africa growth Where want that up? we’re we you XXXX pretty would predictable able really -- about possible we’re generate yet say We’ll this sequential look as run to We into quarter. as we QX. week But clear for

if may payment first receiving slips quarter. left of all just only revenue what’s recognizing or you. Got the March quarter. there level I Is few at well, of of second -- Okay. ask that for $XXX,XXX that a $XXX,XXX into because the this it’s quarter? that or There’s a a it How or XXth. portion it And risk in days least certainty your confidence as then,

high. Right now it’s

sentiment And you a Fantastic. there whole? can economy their just altogether? what’s of of and maybe or or regarding visibility then, Africa feeling that the Michael, Okay. reopening to terms any Nigeria and point your status the positive in Is just, of a the as sentiment, clear country current just overall your trend like of

based based solely it’s -- been has the the stumbling. has oil economy not But in country solely been is price. The of open. episodal opened. been although, oil mainly context is and but economy around Their Well, recovered, certainly

so our Bank, say about been is I supported But and the that’s projects There our by billion. the tune World identity will almost to management To World or edict create on an an challenging funded the a the streets put programs them. there. for Bank $XXX this $X.X by So solution ecosystem in to million, place for Nigeria. prosperity an can that of in help

the the to not If number not and identity number social them U.S. the difficult everything services be do every all including akin cell commercial security the provide what’s country of that have or very our So number to participate a Nigerian side, able because will number, going will right number. numbers. Any country on NIM enroll having called citizen provides, management in be they a healthcare, place without things those social is to are participating welfare-based card SIM those offers, NIM now, to the individuals in NIM time edict that number. that in That a fact is get phone, in of the services here in a programs is enrolled and their to the they not tied

lot look going seeing move enrollment. delayed, So there’s to now aggressively. of you Nigeria a and the exactly at NIM everything that and smoothly going can been done. pressure this moving registrations them. -- leads It’s it’s to and it’s It’s but not get can right But to and you and Google we’re for very

that there be we not XXXX encouraged right on And for we’re Nigeria. feel breakout just a relying So solely us. year now, will

high-tech selling the can So going those coming territories. whole Africa, countries including HubSpot, only some base, but in expand in in opportunity other is a to other and emerging partners PortalGuard across of as from that not with you’re Kenya us world. see sector that things our other

there’s there and for so opportunity growth plenty of upside tech potential. And

about encouraged opportunity. the pretty we’re potential yeah, now right and So, the

Fantastic.

one pipeline is the But pipeline? regards then backlog you to provide and maybe undisclosed to comments maybe or Okay. Michael, maybe keep there for that Are can remarks. any to as regard with to me. you or color strong prepared more you your well able quantify the Excellent. more you the anything and question, talked just want or backlog in with said now. about you pipeline maybe from two And backlog questions additional

obviously Africa, numbers our of the within have of but some now program. also can’t share, in in and CAP don’t growing. it is it’s We with as to I it it’s part well potential PortalGuard Yeah. we a the is our in And business opportunity significant have say core but biometrics, Yeah. in

more in a Service solution solutions. an Program, the cloud we selling service I And IDaaS, prepared solution more it street Security his feet through and to for it Fred MSPs, on-premise Managed the now have we think is doesn’t clear partner have expansion sell on Alliance force available, multiplier our made of love that us cloud-based support. this so that Channel our require network comments installation managed a getting of providers, lot a because providers MSSPs, the and

be of to a going going forward. well growth our that’s part as big significant So

of just versus in then cited core remains the And there Great. or space. are out other capability Okay. one biometrics the BIO-key question, solutions final competitors you differentiator the

and in maybe Michael wins consistently of either Fred, or you’re win bake-offs just when there kind about what talk table or the contract how Are maybe negotiating seeing So any the your competitors trending? marketplace tracking seeing you or at can or deal wins. rates are customer the you’re new potential

I’ll think handle Fred that. I let

Yeah, Jack.

we’ve with definitely biometrics CAP growth. So differentiating now partner most our is and seen traction right the is where

required. we offer they understand different and customers the are something markets, So and know certain that very

now. we’ve traction So right the that’s seen most where

landscape. to typical competitive relates competitors, the it there always is As

So it have we there’s best the biometrics platform. to when solution into And one comes out. no it the particular our unparalleled, competitor integrated that PortalGuard certainly stands

year Okay. for you wish appreciate That’s in best strong Fantastic. the the guys, luck it to me. Well, the on and I of and finish color congrats the added XXXX.

Thank you, Jack.

comes [Operator a from Instructions] question Thomas Dan Private [ph], Our Investor. next

can tell initial But movement Well guys. Nigeria deal drawn that about? at least getting Hi, us I on the there stuff. was on was wondering telecom on you any done

talking Are or.. about Dan African deal, the you

Yes.

everything are moving similar contracts starting of and up A nature, domestic? together both in forward. so is … our

revenues you guidance that those that both deals? Nigerian does gave include from us So

conservative approach. revenue minimal from at before, a conservative is taken level. a approach. in I Africa There a As guidance we’ve myself taken described I won’t but we’ve repeat the certainly but again,

right. All

news hardware get you necessary inventory ship or So you the manufacture shortages. the way if much you’d come about the can do revenues to talk it ramp to the or have like in Do to in? about

were a in some from great a our ability bit of of It’s We that’s some question. interesting. little shortages this because first hardware suppliers. to Well, limited supply ship our quarter,

don’t was a deliver able that bit to we’ve basis it’s sure be to like getting that next product and to can that. ahead the well that we that demand on we So a balancing the But cash the in can coming very arranged prepared a operate in challenge. suppliers Remember we for we of three now are ourselves. a too confident be far our we act. of quarters are third so pretty world do so and we the satisfy Again, But with quarters.

And are ramped product still manufacturing or… they the in up Are China. you

And are in a state Yeah. now yes. answer right Yes. is we The normalized now.

manufacturing in we back lines we’re manufacturing back and like are products are fully our swing. to need now that available open EcoID. site where be. Those products includes like to full And So sites touch, our

good going That’s forward be? great. think number about or change it that Would you I is expect a quarter still that to X.X, is your number? breakeven was

based so We $X $X.X on we are million. and the at really mix Yeah. mix. about the on million depends to now But looking think it

see. hardware, on be I it? because lower might hardware, of selling is That’s margins that the more

expanded we’ve investments, as we’ve our certainly African our We’ve made know, you staff. opened necessarily, some subsidiary. Not

some is there cost and now. are upfront experiencing expense So we that right

if a third-party The if lower. they’re hardware, our on right? mix, hardware, thing, bit little margins hardware, it one it’s again of it’s is are Some

all takes that of consideration. it So into

the So then hadn’t hiring know have I done that for you African begun office. staff yet, for… except you

now on Now cust. the we are right

requirement we any so significant of we things as made we So and opening and will do we a and that. not will But as in Africa investment in to-date. support the are forth, point have see for staff have need this

make a see. you staffed if I office, consider of… And could would you that kind African fully what

imagine. how quickly, even the face had $XX ramp other more significant. if can’t on aggressively, contracts more value to approximately expand. depends fast they and continues so million, ramp, Those our It I a and business really have of and -- how

more if our the sell now example, required. I of partner be across question. answer significant. couldn’t For gets may PortalGuard network and staff more There right But that territory

Okay.

questions interested couple on queue. sales component? the PortalGuard in ask me buys any seeing the and you then a of Are customer PortalGuard is Let get also where I’ll the biometric back

Absolutely.

Okay.

Absolutely.

charge extra built or now? just biometric the for you Have the capability that in PortalGuard is

There The parcel the The an answer That’s today it solution PortalGuard. factor our be if right? finger the is within for to good our authentication and an parcel required part -- system and to is up-sell in question. it’s needs and support that’s part offering hardware, a of to, the it’s offering. it’s of scanners and

Thanks. Okay. I’ll in get back queue.

[Operator Instructions] It will Dan question looks like Investor. be Private a from follow-up Thomas, our next

quarter? more broken was SG&A Okay. fourth I have the you here. just the got a couple in Do What that out?

Ceci?

et As the far as, cetera? marketing, you administrative, mean, what selling and cost, general the

Yeah.

total the is the million. selling, G&A. don’t I that $XXX going front in maybe in $XXX at $X.X of -- to in in I’m but say rest do SG&A probably have there -- and me, in I marketing

Okay.

head. of top Just off my the

charges I’m one-time they right. fourth quarter. the Thank All in how were? been the you. must And down wondering big were have

the paid quarter. had the debt We in third Yes. off

the for non-cash we our like charges the are down release cetera. on were one-time charges, interest put compensation press So down out et and expenses, as cetera, well et

Okay. the the quarter until Is $X.X the And flow quarter? weren’t was counted collected I because revenues first million. down cash noticed that in that

actually did shipment end We of quarter the the larger tail have versus the beginning. at a

and the receivable What Okay. revenue? was deferred accounts

was... What What was deferred the revenue?

I might numbers. queue. yeah. receivable, for the I can just accounts wait the guess you thought And have the I But

long-term deferred are current Yeah. I the and we for and non-current. the No. revenue was have at the short-term end year had of

receivable accounts $XXX,XXX for and deferred had of there we So a total almost $XXX. of

Mike, add Okay. made are is purchased Got fourth looking you first to where in more it. Last about you question shares. the for, quarter, back

want don’t okay, to you that’s asking. If answer just

Yeah. Probably.

Okay.

you. got. I Thank That’s Okay. all

Dan. you, Thank

Private next [Operator a Mehta will question Ashok Investor. [ph], Instructions] Our from come

were the Yes. Thank million I about contracts questions so question. The won. $XX of We understand, delay I I value you Hi. have and just to you and two-year contracts. just be taking was wanted over I a period that the African when -- be -- two would the to contracts. contracts performed the my won, the supposed is for the understand think, couple of the that on it on.

So won? if these revenue So first I according executed to terms we be that my little going so just $XX of approximately I years? that earning is expecting quarter. wanted that? over billion revenues on. of we’re of in reasonable that I firmed now the to timelines reset, to to assuming around be in in get from the terms to out eventual let’s waiting how that were say, kind these a understand, and that we two starting clarify they Is the contracts assumption? it’s of company and is wanted ramp-up But a was just Is coming expect. kind bit know question the first

the and question yes. Great answer is,

Our the expectation that million. basis those continues -- we $XX contracts two-year be potential believe is now on for to continues a

we a the of and be start. a expected full couple after So the ramp to swing, to gradual hit then quarters ramp

our is we’re things everything is in that in over our objective I indicates our as the the remarks my prepared are months. delays, start that unpredictable. guidance, and plan. XX and that we’re to seen the times in and number Again, We’ve very hit mentioned million goal up conservative our again next So a being it going seeing to $XX about still that’s because Q&A, intention of also

as terms life kind sort of that well in to of expect if the over we of I of software, impacts. these -- of what contracts, mix are of plan? hardware in as according kind of then terms bottomline ask, can in level of revenue terms And performed or if Can kind the

we’ve mentioned a lot be beginning the hardware year. through number upfront identity to authentication able in ecosystem. the to of the ecosystem, past sure for as There’s of times a management Well, facilitate and entire

So scanners there’s of as the for enrollment country. a individuals our is fact, announcement. you lot in saw shipment This first to upfront the the across week support hardware in finger

the big be margins So that’s like a software. margins the on obviously are on of part going not hardware to it and

here, or in third-party to depending PortalGuard and so upwards range. could that wide biometrics hardware it’s that margins, XX%, So from do XX% it, have numbers Obviously be be on it or numbers. very the large manufacture the move we ranges bottomline to We that positive can XX%, profitable especially sure, software a anywhere XX% so impact it wasn’t as for forward. we or upon of But we will hardware. about and XX% wouldn’t we could if a talking our the be think significant

right. All

Okay.

other I just in looking opportunities, you’re that was mentioned you think terms in The Africa. had that -- I other actually the of question at opportunities other

lot kind just you of some that kind of So talking is other I just this lot of -- that things these you of after a if opportunities ones question, these might of may RFPs volume general potentially year. about similar potential terms going you of that the in be or of the and we’re a that think size of on of -- of and you last that size -- some so won

consider standard there our Well, business. also is I and there’s of what would that some

as and PortalGuard, healthcare banking, in selling finance or mentioned I example, before, across manufacturing. So, for perhaps,

our management product authentication topology commercial for don’t selling government Africa. in So core agency to identity and the

in same We’re doing Asia. the

solutions there start our PortalGuard we’re be outside to and going of PortalGuard China, again to of course. Singapore, biometrics landscape. in including across that ramping selling up and Japan like We’re But going

And more, here America so in of of it’s more nature we do Europe. we North and what mainstream it’s again, -- not similar in what that’s and more that’s episodal, do

So that’s and our goal objective.

business in that globe. build that type we’re recurring just base the as that the business, AAR building to but kind across to not event-based well, So here the build the business so U.S. of

Okay.

I had. Okay. for my you all very question. Yeah. Thank taking much That’s

for Thank questions. Thank Yeah. you. the you

next comes from Investor. David [ph], Our Flooring question Private

Good morning.

David. morning, Good

guys was I’m going a C worth if how value $X a curious don’t with not the to Osage [ph] just $X your is and put ever ones Tom good value make what announcement even some on it of putting time even way investor the smaller the for Why it’s I’m contract? of with and when back you long announced a you contracts? there,

know, The to not infrastructures. Ad XX technology like That’s challenge it’s I use and have what parties. times to question. or XX the number doing. we their they up get secure deal they’re us that interested last months our a with anyone or what over great from or else question customers they’re year do and investors is and The in hackers this competitors a really their general that for ramped other we so. one, probably gotten, using

backlash, And happens. so this we it a value, have forget we a we -- way, sometimes time have dollar the naming our a very do there we put sometimes time, difficult very risk it let’s when is difficult customers. And a we take

And to one cautious, so have very naming, doing with. who business be number were in we

with the we’re a second want extrapolate The can don’t any way our people in of business. We do basis don’t to We it helps perspective, the share, want share knowing it’s competitive because about we very pricing from per-user we size that. good us part or a our form think competitors. shape think so to cautious on not is and company, don’t

and answer facts. that’s the So those the simple are

Mike will remarks. back like I’d call our over for turn This question-and-answer DePasquale to closing session. conclude to the any

the and much Thank quarter in look appreciate to May, interim news took our in provide you April will first today warranted. early great call. our participate you, late updates Thank a you to as you updating and and to continue we call that everyone, or very day. and on I have forward time We

Thank you The attending conference has now today’s for concluded. presentation.

disconnect. may now You