Townsquare Media (TSQ) 14 May 222022 Q1 Earnings call transcript

Thank you, operator, and good morning to everyone. Thank you for joining us today for Townsquare's first quarter financial update. With me on the call today are Bill Wilson, our CEO; and Stuart Rosenstein, our CFO and Executive Vice President. Please note that during this call, we may make statements that provide information other than historical information, including statements relating to the company's future expectations, plans and prospects. These statements are considered forward-looking statements under the safe harbor provision of the Private Securities Litigation Reform Act of 1995, and are subject to risks and uncertainties that could cause actual results to differ materially from these statements. annual company's certain on those risks detailed the the are conditions that reflect XX-K in to Form subject and company's statements beliefs the current based that are filed These with on SEC. report uncertainties, including discuss profit also measures, financial in income our non-GAAP adjusted we may including income, adjusted remarks. operating certain which EBITDA, refer net may We adjusted and to as current the reports conjunction financial on with used all quarterly, measures year-end contained information non-GAAP and Such website. in in available our should the be I encourage website of this also will presentation, all would discussion to participants some our and as to corporate those reference investor our go slides during download our morning. Bill to At over the call Wilson. this would to time, like turn I Bill

us. for to call able start to I've been Thank to some on and strong quite to outlook announcement an pleased for you you, had Claire, strong for looking of discuss this the including as our Cherry the joining thank very Creek all-time the our an morning be as year, of level provide our for you our we've as time our I'm exciting year. Townsquare. profits record acquisition expectation update forward well reaffirm high QX performance, all

Slide Our And our the on and Townsquare guidance, financial first EBITDA reflect team quarter strong first XX. quarter as strong outlined growth as exceeded results margins. a result, revenue and

million, above XXXX's meaningfully plus first importantly, range with revenue a And revenue surpassed revenue XX% guidance increased to very our net net exceeding levels, quarter $XXX.X $XX.X plus quarter XXXX First now X%. $XX.X by million strong of have we million. net to year-over-year

exceeds of quarter a guidance levels levels also XX% as have EBITDA fourth increased first million, to been million the And that $XX plus now we Our robust XXXX. million. range quarters to also also of since XXXX course, year-over-year above of X adjusted double above digits, for XXXX $XX.X straight EBITDA up our $XX quarter

recovered first be successfully net EBITDA, above have our due for strength to Now and and of XXXX. profit adjusted digital quarter respectively, that prior came plus our year. over surpassed our and profit and XXXX, pre-COVID XXXX In is digital revenue Organically, levels is revenue the digital EBITDA plus our comparing to both we XX% growth. digital and consistent our of relevant QX levels increased revenue In QX of largely solutions. to it results longer revenue XX% pre-COVID no XX%, XX% and Townsquare digital and from our the our total,

for that a have who investors company. radio a profit. many company. perceive Digital as XX% differentiator repeat this Despite QX us as revenue came far at we to profit broadcasters other to discount continue digital of is local radio currently it our clear And trade digital Solutions too our less me fact, our Let for businesses. fact, a in from and

some communities, cash mature our primary is radio is driver not cow But business, for component and radio and diverse connection our of has time. media business. multi-platform audience unparalleled true to have valuable great and properties, consumer radio it's an local an view reach component we of a business. we as asset, radio We that love, stations cash attractive radio While only that extremely important significant is with our and market-leading nor and trusted our a been local flow local it thus, and local a growth

platform Our financial and that order In moving to reinforce be growth it and its briefly to dive into forward. will our digital has continue digital results. been let demonstrate me and engine point, digital

and products and in-house a fully have since of has organically our grants significant, talented our allowing of whom of to outsourced digital own from customer engineering valuable team, design Townsquare to of is entire product our the as They changer platform announce content solutions margins proud reminder to also salespeople to own the day experience execution a As Digital reporting, our our us technology NAB our are by platform award a and control fact our digital it evidenced customer solutions management developed profit our we been these which digital and the the platform, was managers based both with quite team The by very and competitive not our with their marketing that Advertising CRM. our solutions a results. that ability premium business enhances and countless cost feedback and that customer differentiated manage backbone Townsquare, point this game important PILOT management awarded are X. subscription local including very acknowledge without and I relationship which is assets digital our creation enhances products is am to and and that platform, in-house effectively significant true retention. the are we many recurring own extremely on the was Blueprint just for advantage Townsquare, markets, for first, Innovation call products our at have third-party built Having XXXX, Blueprint. that tools have developed extremely digital our been CRM, of Challenge our and sale from grow solutions. the digital

on YouTube across million news lifetime of Slide segment, have across portfolio over million is over XX a generated monthly presented Townsquare followers visitors, segment and websites local XX that generate XXX entertainment XX. apps Our and X.X mobile Digital over platforms our and platform. includes and This marketed social views Advertising unique billion Ignite, externally as national over

high-quality audience portfolio, XX,XXX have across audiences. in we in average, producers the local and States. investment content On content focus and our local pieces curated publish of to this United the of built creating each content one approximately sustained local making month our through largest us We of organically our

operated first-party platform per million XX billion We our a user and for addition, our XXX able management In owned a brands organically digital data programmatic incredibly well first-party as large advertising to built data solution. digital first-party valuable platform valuable created in and our on use programmatic with advertising to impressions customers' we publisher is day, profiles. advertising, business a at-scale in as we collected with advantage more be on from data access own are more especially and as audience. rich competitive desired data this digital programmatic targeting the Being significant a has both than audience effectively that our with

a potential World, As own first-party even data more we publisher for prepare critical. becomes Cookieless

Advertising financial XX% trailing year-over-year. million and the revenue profit, and we Digital net million Advertising $XXX as generated XX-month now me of increased On digital In performance, Let XX% March which revenue $XX quarter, our increased profit Digital basis plus to Digital a a Advertising first net Advertising XX% very year-over-year of Digital profit margin. strong. highlight be of continues XX, plus

subscription discussed Interactive, X The their other recurring $XX XX% two, is media Solutions million of is model $XX clients media generates and XX. Townsquare versus other companies this business one, local our most Slide our service March Digital margin. critical us trailing Marketing a segment profit. Townsquare which a solution; million reasons: profit, This basis for for local that component a number business offer substantial is on of companies digital significant and differentiator Interactive don't XX, a as Interactive subscription-based had is of subscription a Townsquare subscription XX-month profit On of and revenue monthly

added net With at profit we upside profit to are Townsquare or launch the subscribers X% its business We and the the the than of in XXXX. revenue end plus year-over-year, XX. its million XX% XXXX, net XXX Interactive's quarter, nearly due outlined scratching $XX first have Slide XXXX. revenue, incredible first at and consistently of since Interactive market increased on And grown first quarter of of customers subscribers, and increased number approximately addressable substantial has more the plus This as subscribers surface. quarter in we net Townsquare year-over-year, only X XX,XXX billion X,XXX

have discussed, a are to close location. location, signing key we of Interactive a second our new and open plan to for As component lease we growth is our Townsquare a Phoenix

physically and our in Charlotte and modifications space the meantime, continue Phoenix teams We are half our both office expect our support the XXXX. during second legacy office. of to we move office ramp to the open some soon-to-be sales In for planning and to

previously confident operate location going have history we able a and from experience expect will to forward. XX-month On TSI $XX profit trailing as margin, to basis, expect second revenue and basis XX, $XXX of scale Charlotte, million, strong March to million total, minimum decade margins we trailing we of we the million and be that by launching given of continue XXXX. very digital in digital that our will of was on As organically profit from be stated, strong margins, are at digital grow we our revenue XX-month In our $XXX ago. a will profit digital XX% a a a revenue

digital-first month, at end of was platform, will begin we have that a Credit, total expectation the announced profit, in value this with Townsquare the the assets which, of a Cherry to our resegmented the we is QX. digital accretive and and XX% of essentially local our afforded year, given our I profit our date, more that for noted parts Importantly, detailed approximately It strong sum yet of company credit broadcast we and last digital profit our received. Creek to earlier, and the to margins characteristics to information, be of as being each of valuation digital equal Last XX%. platform, business highlighting not media acquisition new get profit gives Broadcasting. will credit which

makes in of given sense. radio business, to seem mature invest some because is Local Digital First our investment While that a it more strategy much it stations, cash this counterintuitive Media may local to cow radio that so is

We top XX economic to this market-leading such XX launch Townsquare we the Digital our always military bases. that Local competitive time, approach ensures an will with to the strategy have landscape same has or The digital profitable been digital revenue in This today margin generates markets be digital team, portfolio its markets solutions, the of own platform is our lowers generally and XX% Cherry experience, digital which markets that digital and to approaching we few profit will expertise and XX% Creek a will revenue revenue Based such sophisticated the of which only fit drive solutions optimal universities At like stabilizing that solutions, digital. acquisition First stronger profit in bring adding at Media these in as large-scale, which criteria. the accelerated years, that and we acquisition cities, Cherry just margins margins. and our from institutions to X with strategy. stations a within outsourced be X-year in our a markets outside contribution invest we'll majority XX% more properties on know our today has growth Creek can

their With in this to XX States. digital of the media the heritage, that growth stable long-term local from engine. And our format, importantly, broadcast being strong local company in have a top furthers in are are which their #X markets will many coming number one we which the confident brands, of outside cities goal we ultimate our base United inject

our financed radio economic stations today. For and with state will greatly accretive, million example, also on immediately sense. The Montana this the acquisition we is and competitive hand can strengthen Washington, From acquisition net in neutral. an be great the of own existing where standpoint, leverage makes acquisition cash tremendous $XX.XX positions is already

by our the strong Xx our goal not does end also impact leverage it cash ability, target Given of XXXX. flow of net

relatively close will acquisition FCC the expect following soon approval. We

to broadcast Our sometime the increasing auto do despite during business plus not post-COVID X% to expect X% advertising increasing strong XXXX. growth, profit plus industry. continued and growth with year-over-year from revenue auto recovery return We headwinds net until to continues advertising

valuable digital cow solutions local term, cash digital cash radio long our an and significant our important is flow unparalleled local radio our supercharge platform radio asset, communities. the solutions, reach we an reach and extremely as audience to mature a local and solutions. our business. properties, But In connection Our benefit with and view radio

Digital start credit businesses. It's to profit by who all whom and the forward growing who had employees, acquisition I Cherry their digital Media will is and growth a solutions fully of and day. Company, be visited to the Local team great serve of for transformation with opportunity of our due with. the revenue strong a incredible, and embraced have year. each to incredible I've been and local platform our their the primarily communities addition their driven our continue Townsquare super and to businesses to Creek local look First Our team, and and our to already with stellar many time spend meet local every and

the much I'll Stu, Now details call for very break in take it turn strong to and greater will down over away. everyone. our results Stu, who outlook

started with and results our segments. that as strong everyone. you, first revenue guidance, well by the as We morning, all good our exceeded growth financial Bill, Thank across quarter year XXXX driven

First XX.X% million. increased year quarter our net $XXX.X prior $XX.X to range of over million guidance above to period revenue $XX.X the and million

to XXXX, quarter compared revenue As X%. increased first net

Excluding political, below expectations was quarter this XXXX's net Political therefore, our revenue year-over-year. below first revenue XX% and for revenue, $XXX,XXX of quarter. increased political political

to Although $XX slow we that for exceed million. a XXXX revenue of off this the XXXX potential still political start has year, believe political to revenue

First $XX.X guidance year-over-year million. to $XX our of million, EBITDA surpassed X.X% to quarter also million adjusted $XX up

XX% versus year. the of the impact prior political the Excluding revenue in quarter, EBITDA adjusted first increased

XX% additions of quarter the revenue growth prior high increased Our net our That's profit Subscription consistent compares approximately again in compared a with first profit $X.X Marketing profit profit of trailing year. to first This net QX Interactive, of approximately revenue, In increased year-over-year XXX XX-month margin. quarter, was subscriber net by growth. to to and subscriber million strong with another This record Townsquare Solutions margin. revenue quarter segment, Digital as XX% supported the net year. X,XXX. subscriber a adds Townsquare delivered QX X.X% last net Interactive's

$X.X of months our total profit XX% to division quarter. segment net goal revenue our digital details for and increase the our trailing as of our first growth the digital and year-end Bill XX, the margins of just the revenue, expect XX% Our of year. Advertising company March In year-over-year of digital noted million investment our to $XXX of opportunity represented in digital our earlier, XX% total on At the XX we XX% Even QX leverage Digital in even to QX represented in breaking and composed revenue segment with way and March our to XXXX. to year-over-year generating a fastest-growing be XX.X% revenue and Digital minimum total, XX.X% by we was thus XXXX. differentiated Subscription QX, well our profit, $XXX in are net a Advertising started with of increased of of continue which margin. over Digital profit. our million Advertising segment's million profit results, providing Marketing stronger with And out XX% increased revenue in Solutions Digital on prior solutions, digital in internal high range in increased we with market the ending our

year Advertising First prior revenue. quarter net political and year-over-year. excluding Broadcast Broadcast improved versus revenue profit X.X% X.X% Advertising X.X% increased the by

Our $XXX,XXX, profit had of a fraction Event activity. only is revenue which million other Live $X.X is Live of XXXX's still Events, which and category, of

approximately However, our overall of operated were Live an Events profit at margin XX%.

for another advertisers not of to a revenue Fort year, as us see vehicle same. providing Taste a expect a Dirt the our do As profit company X% and the of communities quarter act concert, we some are Events allowing a Live material Red growth rather the Buffalo's events reminder, Festival Taste to nor our BBQ audience in of Collins. way normal company, Tyler's scheduled and Live the operating Music in marketing but yet and We revenue total events, of of In and live with and than arm our a less Events do part second business, pickup company, & profitable profit. as for to have XX Country including connect is

expect that XXXX XXXX. for However, Events, true be we for below still remainder to the levels Live will be and of

in expenses professional primarily an corporate fees. quarter increase increased to $XXX,XXX due First

the like diluted diluted We on $X.XX tax tax tax in $X.XX only. increased you assets. purposes million one-off per to loss NOL statement the release, compared the our of amortization loss first income, federal for share a net Adjusted the as benefit to provision or or million million net for in and quarter related income financial significant XXXX. of any share taxes $X.X million carryforwards other or a was detailed share income statement or to diluted is to excludes $X.X schedules maintained $X.XX quarter XXXX. $X.X of to per of $X.X our and first items per million intangible First GAAP quarter including of which We'd the $XXX for substantial the remind attributes, is included face of that in income shields earnings

positive the interest We continue $XX flow will million XXXX. after approximately of material a to generated In cash XXXX, believe cash first not operations we that we payment million approximately of until be taxpayer from in a cash February. quarter $X.X

of $XX.X balance trailing XX, million of debt end adjusted year-end. million a quarter. leverage net $XXX.X and from the cash total March XX-month was at million, EBITDA X.XXx as total to the of has X.XXx at $XXX our Our declined With of

reduce permit, $XXX a which is any focused in readily ability will of be year. senior period conditions afford this our when X.Xx, are on possible We the us million, this capital believe next term ability could X.XXX% We lower our refinance February it net to time. market notes the achievable continuing the structure believe have end with advantageous a to no-call will well annual with to leverage year, senior we replace notes and the secured to target of expires. X-year our loan by we as prepay as we rate interest of secured If the result the outstanding at loan facility. believe

the given generation. million, across very acquire cash our our which reach markets mentioned, Cherry Creek strong goal cash, XX expect market on use The which Broadcasting we of portfolio. As still of stations X hand. Even $XX.XX close leverage agreement new local by we transaction, cash flow to to relatively we for Xx Bill $XX.XX signed with add of entirely an soon, will our to net million year-end, funded will be expect this with will

is priority may allocation so leverage year. that the successfully we capital primary for execute reduce Our of the year net refinancing next remainder to a

Board leverage has we of stock a million, our is authorized priority reduction. that the at million believe our in is undervalued par. X-year and XXXX notes our net $X.X and repurchase program, sincerely Although $XX repurchased retired end, April, we stock today, To

As profit always, and to and revenue invest in to local we in will support business order also continue drive to our growth. continue

Turning to second quarter our outlook.

$XXX which and million, We revenue expect to $XXX increase a million quarter prior between over XX.X% X% net the year. and second be increase to is

quarter EBITDA be million a million. $XX $XX second of expect between to X.X%. X.X% to adjusted increase We and is year-over-year That

For the guidance full of net to million of $XXX XX% a to year-over-year year revenue our XXXX, we XX%. are reaffirming increase million, $XXX representing

our XX%. also and of that, the call And back turn a will to $XXX Bill. increase adjusted I reaffirming million EBITDA over to of are We $XXX now X% which is guidance million, year-over-year with

extremely Thank you, morning. our We team everybody, Stu, of us proud about and thank joined this greatly our results, appreciate I'm and I'm extremely you, future. it. and first quarter excited who our

have and recovered to each drive to new we Townsquare our and We levels, adjusted quarter. continue every will fully revenue pre-COVID and to heights EBITDA

our due now and of investors platform LTM our today, to steady new evident $XXX million Over digital more digital profit of minimum to revenue Our growth, continues with a have from million to XXXX. revenue segment by net of QX. came total reporting, $XXX total half in growing company's its over

then the past year. And savings. path opportunity that now interest the Xx could the cash X.XXx, and meaningful to potential refinance well end dramatically at year, the X of is to the sheet balance has on of Our leverage net in improved over lead months by

Thanks, this hesitate do again, reach if the all questions and more for about any any high As time, please not say Operator, high. to Townsquare. internally, open at how out questions. have we please lines to and you all, is

from question [Operator Instructions] from NOBLE Capital Kupinski The Markets. first Michael is

could I of quarter. your what your thought locations, a little expansion bit Phoenix, and First you record office might wondering be was talk if just you about congratulations in and for I a your all, time you about I that were Can opening maybe an offices your opened talk but California, you know plans? bit line additional those? on little office that in

that is do expect expansion plans. roughly lease of the remotely office build-out but always based if the Phoenix, [XX] but that Phoenix. be West are said but office working we location, California, while in space fact, office Coast, in not half Interactive a Townsquare them currently are We've signing in to Our the We've in hired in operating employees we helps. this and back the of year, it who

like on of Bill, were still Midwest. And the plan you or... maybe offices Is contemplating maybe of additional opening up your part that in

about plans open base location. X we as That to of saying in outlined Really market years, addressable the we that in short-term for percent a But local our the would our highlight approaching terms market given continue the and scratching that potentially the X could be open we've our Townsquare second we've our -- talked footprint local second that third currently, years footprint. Interactive of the location, obviously out surface. we out we're just location. just at of are XX% billion, to outside in XX% total $XX customer We're market

QX to XX%. continue adding net QX strength our We've really revenue We're to investment accelerate with record in in our a we Townsquare million of strength Interactive. in $X for continued continued QX, So QX pleased in set almost plus obviously, number adds most there. that

to a location potential that. the down then focus And open road, but excited for location. focus we're this our So on is would definitely, Phoenix. is I current Midwest there

business national in radio smaller then concentrate is And markets. may And little another for have national have is And that of know that advertising advertising? record, indicated you a from how radio lot advertising. that that differentiator you other national companies is for very much of But yours reason, the I weak. your companies of

fact outside the inside for presence, when team of media our the utilize we're like-sized markets. only we outside top States, have in principally Charlotte, sales operate you're would we I calling what top where also our, The cities center XX but United markets right. we call local in world-class the exactly XX Yes, that not call,

are different driven point, is So very in players -- to principally from profit markets. our those than larger who XX and advertising XX top top very, revenue national your

advertising revenue. roughly direct quite XXXX honestly, of national X% levels was our a broadcast from our was performed It Quite our is So was in up well QX. as up levels. -- up was over national perspective, total net local over XXXX

our call I XXXX of chip would or done auto And levels some chain there's particularly had outside supply QX. either broadcast the well. furniture, their for our much about our back national stalled business, issues. honestly, it's pretty strength in of companies our To definitely quite versus QX. Digital Advertising thankfully, believe, to media, a point, and us we've will our for and be outlook appliances local has us, QX. broadcasting, QX quite continued benefit including in your be retail, piece such than supply higher and we've we to broadcasting. broadcast solid direct in But small So But where outlook hearing that continues other local for QX QX, And business local of talk

the QX QX see we up of in strong from and from after quarter digital and was revenue digital XX% ever, of XX% us plus our revenue digital up to, a brought revenue having our very QX now profit Digital in solutions. for digital So XX% our XX% and over profit an in which comes XX% being of of being time profit XX%, our Advertising of solutions, first and acceleration XX%

-- digital and for just quite not noted, engine X% being only sit and plus markets, growth a full and we confidence X% year, plus we as gave strong on differentiated to which QX smaller digital-first being QX. XX% company, plus I the May reaffirmed guidance our transformed And X%, well. So for think our as we the to set focused point, really as in but operating has early range revenue we to your in us plus guidance, having profit in year, reaffirms our having range up having, ourselves to here

revenue in of of maybe quarter. And Bill, Anything QX different terms second you in different may the what differing guidance it this first like be or just sounds anything the outside we reflect categories there the that saw accelerating comments. your -- it's Is trends, in regions in advertising the the than whether touched indicated in for It US. digital? you what in quarter on

advertising I Advertising. we standpoint, noted, No, see just from nice I think, an for as tailwinds Digital

that's think XX%. QX of above going to be I our rate growth

XX%, Digital Advertising I in and range contractors, residential, think HVAC. in financial like hospitals, like be for real services we seeing And in we're health services, there, strength estate, could builders, the QX. plus entertainment, XX% commercial services doctors, clinics,

So there. we're feeling quite good

levels and down weakness see do in actually from down above is and still only levels. broadcast, our a small As down, Local national it's well continues slowed We autos I from noted, that's we part thankfully, XXXX has for obviously, to it QX, relates to XXXX, XXXX, Not auto. but expect definitely be business. of XXXX just above that direct XXXX. to continue up into

we and and we furniture stores QX, larger meaning even appliance comps, into more got in revenue have and stores QX those categories. QX auto get QX As and in

expectations overall, is be plus for for drag. we have as to So broadcast XX%. And slight noted, revenue QX overall, plus I just still that But a will very guidance solid X% our QX.

question Barrington Goss from next from Research. The is Jim

out I'll Stu. start with one for

of was somewhat issues wondering you an goal? a slow just of and start, impede you $XX the why can insights. what that million if mentioned happened towards whether the You but ultimate to full your political your have still that might had off I progress had idea year was were,

political comes Quite honestly, when of kind to tell It's in. hard no.

slower. comes sometimes and comes unexpectedly, it in and in quickly little a Sometimes it

everything we'll we're summer to levels. the XXXX -- we're and going we're months. to to Our to people do into get are -- back for are this need hope that out everything And hoping see up. doing see We're we that to some they there improvement starting year. get coming The everything get midterms hopeful come coming that

it gather Another, about involving targeting Broadcasting might your if involve how might the more make you influencer make you're wonder do and you desirable sense? acquisition. like much? Cherry how any talk find the be to stations? geographies all options And the digital plan, transition -- there on the more execute other would that see that are I And aspects you such X local so might you you you to of I Creek not might or And you would have business. Townsquare

excited So we're Creek. Cherry about quite

in remarks, and a back above quite markets visit of XXXX the of to going team quite perspective. done number actually, to XXXX their They're As they're the I we'll and end of team. prepared broadcast their be at visited spent excited. not week, level. I've with already time the They've this levels, a if the rest And well noted from

a it's So of XX% digital. well-run But to is company. roughly XX% revenue their very

person So market-leading that leaders we the local time great And team having brands, with new now Creek, help you sales can and great as Cherry we and in platforms, table, with town through bring digital businesses quite spent calls as virtual just to their all ways. this local hall, reach the grow team, as noted. in they're excited their adopt well of our audiences see to

Cherry months. XX approval, these in our to Ignite months sales these and the us the deploy; couple FCC presences we're if bring Creek of your terms strategy Digital market. digital a point, largest largest, the not our into audience Interactive in these one over to first, the becoming, So, additional Townsquare next expecting X our in see markets building digital then the to Townsquare we'll next teams you'll once grants online of us And and Advertising of which

excited, diversifying couldn't with So broadcaster, we've noted, be taking great company the pure we had over is last which that XX I at. something and excel experience a years to digital-first a as more

country the such you've that make other outlined? [Indiscernible] within of terms In would sense the around context potentials

like honestly, the natural disciplined quite Jim, had in opportunities Quite we media the into before, acquirer noted when and go we've of assets top are outside top we've think even markets. XX operating been this we markets. consistent local to XX I

exceptionally markets. Our I in understand think strategy and these it quite we works well well, so well. performed We size

footprint took acquisition, by many we've Creek the So the I talking there growing particularly some with opportunities surprise, our think been are given it great other brands. Charity that, about though right price at even surprisingly,

under being political is refinance either opportunity bite-sized, Post refinance, We next year. We Xx. if build million cost, we it cash, outcome, focus February that because -- bit time the $XX top obviously, XX financial as quite of either rest XXXX, attractive getting year, the outside markets if of be and throughout XXXX. greater great. now a our Cherry markets as for So this the Stu to cooperate, got do not coming refinance acquisition go first, a was multiple. right to able be noted, down the delevering, continuing at don't And for think an Creek there'll in into to M&A if we cash particularly cooperate we do period, we'll off or I year, markets of

at But focused if I now of acquirer years, So X of that's think on what natural the we're delevering. look these you type to next we're right the X assets.

And one regarding one TSI. last

that pursue you fosters all to relationships this, of just other of You've and the of services make aspects enough and talked is you off could monthly it creative trust able per current beyond it about I'm if premium Or make not the $XXX plan? with were with your that create bond month as path, wondering staff. fee? messing that local say, could the there this increase customers develop by of $XXX average types -- if engineering better business add-on the, you ARPU to

you been staff, our and team, them investor just incredible remarks and bond question, deck. I noting differentiator appreciate I an has as engineering the Well, trust and the growth of the and we all organic. that and the one It's our of yes, in highlight in noted is great our just

Our world-class. knowing acquisitions. size their we markets these feedback go Day build of the and gotten that and XXXX of isn't with mentality us X which building all since on and their serves us and engineering solutions, is needs. in solutions, businesses many been having It's our challenges then the digital based growth have team, And just

them. So great couldn't award, some NAB to just them receive for it see show proud of at the was be the accolades more pilot

with XX,XXX. foremost, on there's market any in for subscription under investor million or XX,XXX services, not we're which we just $XX and a our target subscribers service, the approaching opportunity, adding almost billion clearly, first So deck and X tremendous outlined

-- looking quite into Phoenix top continue X, we're in we think it investment we're over So we're to to location, doing grow able QX. going at, confident our with continuing to added minimum be we've feel each at and that plus QX year, Increasing to I like plus operate. the line. roughly $X XX%. And XX% get line last plus for X XX%, in million We'll years, $XX million bottom was

be But looking We point human bring add-ons, other type our on the they opportunities what couldn't we're add-on? state type a the types SMBs built up subscription services our of customer that. business. management We the about platform. down resource excited that CRM, to at be to about more We've clients. you add doing, we talked these are of continuing steady relationship payable So investment. accounts Could for increasing

those point But what that testing said, greater for greater we our digital really solutions up is to Jim, ARPU, of even steady opportunities could state we So are for ARPU. and to we're existing there future you doing. good current a our just that all opportunities on premium are tapping some add-ons that drive future are those. add marketing bring But

the I'd Wilson concludes any session. to back remarks. for the over turn Bill This to conference closing question-and-answer like

our really results everybody, you, quite proud dialing of and rest We're for for this in the morning. year. excited Thank the of

guys reach to a any questions, please you day. great If hesitate and don't out, have have

This concludes today's conference call.

day. lines. You have participating, pleasant and Thank you disconnect for may your a