Senstar Technologies (SNT) 6 Jun 232023 Q1 Earnings call transcript

Greetings and welcome to the Senstar Technologies First Quarter 2023 Financial Results Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Kim Rogers of Hayden IR, Investor Relations firm for Senstar Technologies. Thank you.

You may begin.

Kristen. you, Thank welcome Senstar to the call conference I'd management everyone for thank Technologies hosting and like to today's call. are With today Mr. us Fabien Senstar Haubert, of Mr. Interim Technologies; and CEO Tomer CFO. Hay,

I'd may other of forward-looking Senstar regarding this assume they start, Before performance. performance reduced still with Actual out by are company's trends, or results as the our industry, cannot some statements any fact, to that company security of the well does of pandemic future only materially and systems the These contain or may results statements other may the future and that significant obligation operations documents are risks we events projections effects as to COVID-XX conference update like in the demand unpredictable occur. result competitive guarantee call identified in will, projected, uncertainty future events overall Exchange Commission. point not and and that those the be information. could to that or by a be which in the including Securities filed differ and from of nature Senstar as regions impacted financial market the changing predictions duration the regarding and extent

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

the our comparable website can related measures directly You most reconciliations. financial refer at www.senstartechnologies.com and to for also

the like Fabien, And to to please. call that, Fabien. with now over I'd ahead, go hand

for earnings and we you Interim in to we my the by committed company's speaking delighted on I solid our you, want market. direction. as today's expand to Kim. be I'm and to grow move role and provide forward, to to PIDS of update constructed CEO investors that performance the morning, is first have the joining call. upon call and in our pleased an Senstar thank with you strategic Good everyone Thank This begin our remain on previously building I position today. foundation we assuring our am strategy

to our existing focus and to X in capacity reach primary offering Our expand product our share continues our expand market key grow verticals operational increase and and and sales customers.

business. product Starting by line seasonality last quarter the in R&D, support the was high-margin look not was mix. marketing with and invested our to launches. impacted for The and We repeated as in the revenue first was quarter well sales XXXX, reflects Europe of first Gross this of product quarter. as contract our at new year a our margin expectation in with primarily

our expand of margin. is maintaining share to while top One strong gross our objectives market verticals within high-value

utilities, corrections presence We value customers' we have comprehensive away from are an These they To markets the and solutions and of markets our high-value We're present and targeting We scope concentrate customers. characterized deliberately focus. maximizing verticals seek this management expand sustaining logistics. for on high-value has complex increase lifetime sensors solutions aim security in provide of vertical leverage they growth energy, scale already to further opportunities adjacent us. incremental solutions for offering our recognition. importance brand that appetite opportunities the to and commoditized by and our information significant our by to profitability recognizing the when shifted business, value that vertical can and these established Senstar focused attractive markets our sell solutions because

is developing solutions engine. adjacent logistics we're like we our and workflow solution example where An PIDS provide

offer can we ability to secured where facilities our ample needs our our and share example pipeline and improvement. based We FiberPatrol footprint old solution. room our see understand protection security Another evolving in take for field global We production for market processing pride additional the is solutions the on of of customers.

Our and commodity demonstrate market. the to steady products ability differentiate from our in profitability growth

In the in pandemic time we for first growth XX% The COVID-XX quarter, and the achieved typically began. U.S. total revenue. the represents over since significant first the U.S. our Europe of

due Europe, awarded in in regions one This strategic was from quarter, of corrections, contract a from target the in growth best-performing one contribution the In strong the of these to U.S. we X were about of performance our QX our vertical. XX% verticals.

to the potential scale are with and our U.S. in our Europe new We vertical. in business business the targeted advancing opportunities

We in markets in Canada also including Americas, Mexico. other opportunities have the these and verticals in

innovation, On to Product has for a prioritize vertical sensors We're been to continue innovation, the video advanced we evolving actively driver growth product analytics our solution. developing investment. key drive next-generation and R&D Senstar. front,

portfolio directly solutions and sensors with market aligns next-generation Our demand.

stay We technological efforts are of allowing at to shifting the customization research our forefront and initiatives, to advancements. us from process-driven development

comprehensive on risk to our innovative is management security based leading our maintaining Our solutions knowledge and edge ability industry deep platform. by for backed success a deliver and

most by video to ability maximize and data security customer the platform. presented actionable use visualization into sensor information a Our our information effectiveness up-to-date analytics differentiated take it is in We to its space Symphony unifying of transform platform systems and AI and systems. from on separate the

key to our are to we is force turnover standpoint, to presence. customers, in fortifying our representing achieve expanding To verticals, commitment our further this growth portion turnover. objective overall our X goal, acquire new From substantial sales our our a market a reinforcing support personnel of significant

quarter. Now let's turn to our attention first the

by quarter typically our close par with the our we on we results and that projects expectations lower of the growth Notably, in XXXX of the driven the the previous successful experienced correction strong year. Given regions to States primarily EMEA is which seasonally and United QX QX to the year, achieved were weakest quarter first completion QX XXXX. exceptional vertical. in is attributed APAC than

to figures. lower QX the were quarter. the of margin the plan, with mix our during they solution exceptional deployed mainly margins were than XXXX our While attributed is in line This

we're on offering focusing ourselves forward coming look and conclusion, for high-value drive our steps and share we're vertical research you in markets, solutions direction and appreciate strategic market expand and we We success. positioning In growth investing support on progress ongoing development, updating to the your taking are vertical our by confident the and quarters. in to comprehensive in our

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

Fabien. you, Thank

a the revenues in decrease of reported $X.X the for reported X% first XXXX. Our XXXX of of $X.X first revenues was with compared quarter of million quarter million

geography to to LATAM, APAC decline as follows: first compared the XX%; and the North revenues to XX% the to and as primarily year compared America, ago As XX% to QX in including region. others X% XXXX Europe, X% percentage APAC of XX% compared in is periods. the breakdown of quarter a is XXXX, due The Fabien compared both exceptional project quarter for mentioned, EMEA was and XX%

was in quarter gross quarter. was mix gross of reported shift in a of to due margin First compared products revenues year. primarily margin the The sold the to XX.X% decrease XX.X% last during

the is to million, selling the year's in Our quarter increase an reported operating year-over-year ago The of compared were due expenses ago first million. expenses expenses operating increase operating -- increase prior expenses of and marketing X.X% in to year year $X.X primarily quarter. $X.X an from

was Our currency compared this of report the valuation to income our monetary in expenses loss in in of million quarter with last $X.X year to we liabilities effect adjustments the quarter first an reported to of and in million operating operating is mainly accordance the the the currencies in entities loss regularly to This functional year. the of due GAAP. compared a denominated operating $X.X in noncash period. for than the accounting assets first group was other financial $XXX,XXX year Financial $XX,XXX ago first quarter the

Net or in the or loss was shareholders company's $X.XX were negative or to quarter of first per year. per million EBITDA of $X.XX year. share. the $X.X in in first attributed million net and to for compared $X.X million share first of per the March Senstar $X.X quarter last million XXXX, XX, was reported million The a loss share as quarter $XX.X XXXX of to $X.X equivalents compared $X.XX the cash last of Technology Cash quarter negative

remarks. like the now. my questions Operator, to open we'd concludes to call That

would Senstar, On and to quarter. look continued Have good a our behalf the business. long-term management you thank like interest support I you I day. for your of of forward next of to updating

and gentlemen, Ladies today's does teleconference. conclude this

your at and You may participation for a disconnect lines this Thank your time. you day. wonderful have