Senstar Technologies (SNT) 22 Dec 222022 Q3 Earnings call transcript

Greetings and welcome to Senstar Technologies' Third Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder this conference is being recorded. I would now like to turn the conference over to your host Kim Rogers of Hayden IR. you. Thank

begin. may You

and me our Sharon, today and CFO. Senstar Melissa conference CEO quarter call. Technologies Hay, Tomer With are, Mr. welcome you, third to earnings of Thank Mr. Dror

materially including as assume like we differ competitive projections will, Senstar filed the Exchange obligation cannot market nature predictions events those contain the forward-looking our any clients, company's to our Before performance. on effect other the as does result fact, the I'd point trends, that occur. statements security with call results Securities or the events this and future of unknown or systems industry, regarding operations that risks documents they and from changing and the These update guarantee projected, well identified including in in of unanticipated information. out Senstar statements by as future that and coronavirus, may conference or not to reduced other Commission. only company the demand, the and a start, are Actual of may

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

to go the please. directly related And now reconciliations. can the hand I'd also our and Dror. measures ahead You comparable with financial www.senstartechnologies.com Dror, to at call most refer website that, for over

quarter Technologies' results. us today Thank you, Kim. you Thank to financial review Senstar joining third for

compared year's X% third to quarter. by $X.X increased Our to revenue last million third quarter

contract cycle and in the particularly were which balancing of Strength the the Asia-Pacific the industry. European delays prolonged sales lockdowns tied to funding our across similar year Our COVID, in for U.S. related compared our region. longer further challenges business projects the Canadian last is and award to government strong in quarter despite to bookings in effect presents

see say pipeline. While about and to happy to that in our we are it's seeing frustrating order project not I'm cancels are are optimistic the any postponed, opportunities we

of to majority We over and we several strong to close deliver coming next that projects advanced we months. revenue the XX expect the of negotiations expect backlog have larger it that the have in a that months

in previously, hardest into budget to primarily dive revenue delays projects closed, vertical performance details. away referenced shift gas redirect an The in and for cycle security further facility. those perimeter project the us U.S. energy hit due provide facilities due the Let's quarters. has contracts U.S. an standing the correctional Corrections, The that into are was to current causing have from These not We but reserve been regional from important infrastructure. I extended for the from has awarded the federal been is by that our to federal recently an related correctional growth closed administration most oil the the down earlier facilities. new closing as the government been to budgets to region sector. delivering active delays

to facilities worldwide. large stage the their gas to main oil that a negotiation goods We become our U.S. closing anticipate are of final in provider and supplier shortly with the

In addition, our will boost help U.S. sales.

on June has larger greater in XXXX we the marketing contract that The The seen and business follow-on APAC initial includes Senstar announced On large in China Zero region is our are we focused optimistic the APAC perimeter multilayer system has year-to-date. key is for we security market and investing cameras two lockdowns secured the the a that integrated buried an software Asian region in platform security with and region fence a starting we with with headwinds orders. and to in note, has for expand growing. We existing positive sensors verticals gas related and airport with COVID impacted been management XXXX. region and a The slowly this conditions. by of helped another are policy that detection integrated oil starting APAC of quarter, EMEA projects, we news The featuring are systems are facility's positive rebound intrusion the large the mounted which currently included and open fulfilling. to and other closing infrastructure.

new Senstar year, growth Canada performance large a increased has slowdown large calendar has that our Italy. developing position. We also specifically awarded Infrastructure to long our This year-to-date. established Critical vertical QX. our in project -- well nice for Correction and America, responsible market. of [indiscernible] vertical, Sales already The who is This record a strong in maximize management the COVID. in solid Canada, have executive in of forward Spain, in market delivered expanded customer in for advanced contributed was European again focus begun returns appointment remains facilities. has to utility fulfillment Manager and people region a the sales addition, projects and due added and we several field Europe a regional our steady We home to The has landed Canadian positioned North In after own capabilities track to moving advantage. and XXXX court the South sales delivered to experience our now in engineering fast great opportunities for is brings with sales regional Portugal, sales

third pipeline. all On solid at brand developing opportunities our event existing the year, QX. development identify last and customers. with customers regions. more in us our Higher in with on numerous we Backlog compared our enable reconnected participated We marketing to engaged this to new prospective trade focused at the and of and front, and attendees of end shows the events in industry and new the meet remains quarter

impacted we approximately $X.X rate subsidies year-over-year of with the at the subsidy expenses. from million that operating bookings the completed. sold is the wage emergency steady Canadian expired growing is quarter quarter. revenue in backlog a the It goods subsidy Last cost we and of this not third replenishing result XXXX. comparison time, This our are recognized the in the year-to-date While has at this approximate quarter program in received of year, it third and of working

product our introductions, [indiscernible] Regarding to internally. version is the Senstar continued also and Platform fiber Operation improvement with Senstar release X.X solution assessed Symphony Common this the of new

which the products in -- positive -- at quarter getting quarter the release to links versions. a in our customers sites Fusion our are We PIDS of million equivalents or for quarter of currently next sites fourth of with cash We plan and of our This purposes, better of million. running from year. capital was to is inventories their use the $XX.X of solution, accounts software We with devices specifically feedback on and receivable. in The first cash two new XXXX and XXXX. of ended end months in primarily the investments increased few compares as $XX.X in the working cash nine the third first of

a in to addition In significant payable. reduction other accounts

invested regularly has research also advanced solutions. produced We which development, in and

crucial solutions solution Critical in Infrastructure, where trends essential competitive a assets have comprehensive and facility has Geographical consistent each that the increasing to and turmoil three protecting of of keep a increased us for macro are there sensitivity security for logistics advantage solutions. operational. verticals, demand that the delivered increased innovative that global is are fulfillment is and As to volumes essential efficiency. a objective we There Senstar volume Senstar protect global [ph]. platform. Energy benefit with and to our them operational valuable solutions developed shipping for mean facilities critical unrest objectives. an Likewise, those result, fully including an facilities

energy our product Senstar has remain with worldwide. In correctional, focus growth. no global a value. deployed strengthen increasingly result, our footprint with We to Critical and are a Infrastructure, create solid balance products summary, ultimately committed on delivering our expanding increase to to logistics, We debt. brand, As innovations, prioritize our in shareholder value cash sites and sheet

ahead Now, please CFO, review call our the the Hay. financial Mr. to I Tomer, Tomer pass will results. go and

Thank you, Dror.

was million, XXXX increase for the Our quarter of of in of XXXX. an million revenues X.X% $X.X $X.X third quarter with compared third the revenues of

the was as for Canada third as increase in revenues the the primarily to to XX%; due particularly new year compared is well Europe, of as signings, discussed, XX% X%. to The percentage XXXX APAC, ago a of breakdown business compared quarter North to Dror follows; quarter geography and XX% as XX%; to EMEA. Latin America, XX%; compared compared compared As to XX% X% a America,

primarily profit margin due XX.X% primarily products mix compared gross Year-to-date, shift our comparables. flat in revenues, sold the of was of as to challenging The change quarter percentage was is quarter. ago of essentially quarter. revenues lower the gross in The a reported year a with to the due a during third XX.X%

the the subsidies Canadian as As our of plan was Canadian to partially subsidiaries of emergency subsidy wages granted to goods cost that sold. XXXX included part allocated

of cost sold Additionally, prices increases some prices. despite higher our impacted goods by of the raising by mitigating was

expenses a of like is increases cost ago. Our subsidies portion year-over-year On year-to-date expenses in expenses goods allocated third due were increase primarily basis, flat being a operating in compared the of the to prior the $X.X again, year quarter. Canadian to million, the reported in operating the essentially the to sold, year operating

to a compared mainly group the in $X.X the reported in GAAP. Financial for our with regularly operational monetary the effect expenses financial to $X.X of last third valuation liabilities currency in of than non-cash the the to of in million period. assets due is quarter $X.X functional this million ago the of compared in we and quarter the quarter accounting report was million the denominated of year to Our and currencies third according year operating income was other the This $X.X year. adjustments entities the income million third

third The attributed like in to to of discontinued share EBITDA for amortization of shareholders the loss continuing net year. a are $X.X and was Our This $X.XX reported in assets expenses Senstar expenses third continuing million third third Technology $XX.X the share compared $XXX,XXX of to The quarter historical quarter last last year acquisitions. the income $X.X per were to for to the of XXXX compared million open the for Senstar corporate of third concludes and year. quarter million third to reported million the Technology quarter year. same operations loss $X.X the in The would of operations Senstar cash quarter quarter the third my a XXXX. now. to quarter million includes of operational $X.XX the Net operations million reported were That to intangible the in $XX,XXX remarks. compared for to attributable discontinuing and $X.XX third quarter ago income shareholders compared September call $X or $X.X the or per XXXX company's income the was year was third or in in quarter. of Cash share. in net public net $X.X operation. the income XX, questions in of of for the quarter of prior platform Operator, net equivalents last as contribution amortization $XX,XXX approximately million, from prepared as Added we per for

this Thank At [Operator you. you. a we'll Instructions] session. time, Thank be conducting question-and-answer

with comes first Our line question. Please proceed [Indiscernible] sorry, -- I'm private question the your with from investor. of Norman

in down ago. Yes. down current low, December stock a numbers et Senstar company reached the Revenue Yesterday, serve is was stock days great low XX cetera, the really points, for all-time market years. last X%, for okay, an was XXX on up XX, picking all-time you've five stock value for Cherry don't and earnings your your the purpose.

short grids this electric these there the attacks were States, were attacked. the infrastructure two period Carolina, electrical North time, During United on where of in

have news against from every you Now, these this could You kind install equipment, was frontline country. one done? of okay? is could Not States bunch should of you. not This not this news what could these is United squeak could to hands? Sales every got type on and things. the have we attacks, We done. We protect one in Sitting Managers, they? that a was been what in interviews have we Why were channel on protect installed channel, recently their the where protect said, appointed of newspaper every word, the news They could from Senstar. on

the strategic are -- we with Okay. stock with market do won't in market not like you with the and should stock did this dividend. also good to that pick are don't the was it, Carolina, I'm we us your for engineering I familiar accurate -- check distributed because to it Magal North phone this the think The remind Hi it. and look On stock market, in this a year, last with you into still familiar offline things, division and with and it, are Project what's of or we as below the had from About users, me is is the Thank know, down or call not And -- this, I is we other that it. it things something we trying improve the the to very have -- care of issue. end you situation. we last in after Usually, question. course, the went just responsible have and I'll we on. top to down years. ideas but trying And working integrators sales do for stock in any if going -- our guys of can but issue Norman. not shape stock went you see North performance. suffering I'm up the take And to more you and Revenue-wise, us and always and of specific and close many are in the higher. the much U.S. everyone be we this that And see the like last Tomer system because we'll the you We with Carolina. what take that we revenue five between else. can alliance

Please next Mike proceed with your question line of from Distler Thank the question. AMX. you. [Operator with Our Instructions] comes

Good I'll be gentlemen. afternoon brief.

Duke -- in able the well at plants wish second it up have the since half free U.S. sentiments been echo power shootings all press just [Indiscernible] was regarding we phone had Just to the Mr. different from anybody get regarding North I the might as over like two of Carolina. to picked the Energy Hayden

one it I pillars again. you'll verticals three utilities have or that pipelines -- you're that echo know after. people of won't -- I and going I that being So, being know on immediately. utility's that pillars the

free, years more that States. the ball the Senstar we -- no to more out decrease, think here back question, there pay globally. doing question the many the as And stock's Hayden, is Secondarily, United congratulating the in And little we somebody should management there down, Colorado the be in process, say. as to as to Canada, Clearly, since your basically of dropped all distributions, first aggressive, things well but well. representative really are new any a fact, business over price I I part tempered there's because attention in of what wonderful so prior do as argument but a want attention the season direct a conversation have on could to COVID-XX In to put prevent which able the for happy, actual all really successful way, as were, year. last storm a the spin-off gotten being wish a weather really well of actually healthy the of which I these to the pockets. for that's holiday help and lot had occurring we did just again. you cash two speak, half and I could folks' from to

Thank you very much.

Ladies you. Sharon I'll for our floor and gentlemen, any Thank question-and-answer comments. concludes this final back Mr. to turn session. the

-- I again, any some Tomer I issue, to said the any investors one the are welcome were call of on the you And Thank next reach again, look other as that or Again, earlier continued always our to updating always can us you behalf for for like you for today, Senstar, and best. reason, much. like you support the me hopefully the if very you and for your forward and of thank quarter would call ones of management to business. long-term and would of easily. interest to I on [Indiscernible] pretty

So, happy enjoy everyone and holidays, Hanukkah thank you. the and to

holidays. Happy

This call. Thank conference you. concludes today's

You participation. this may time. at disconnect your Thank your you for lines