TACT - Earnings call transcript Q4 2018 | TransAct Technologies Incorporated

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Operator

Good day, ladies and gentlemen, and welcome to the TransAct Technologies Fourth Quarter 2018 Conference Call. At this time all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions].

As a reminder, this conference call maybe recorded. to host like Mr. today's now would introduce for your conference I Leahy Investor Jim Relations. with begin. may you Sir,

Jim Leahy

Thank you, afternoon, quarter Darrell. Good conference XXXX TransAct call. fourth Technologies and welcome to

participants Bart company Joining on from will the questions. and results. strategies, include for the financial Steve are progress Shuldman; of call and We'll discussion fourth the key Chairman DeMartino. us quarter Today's President the call then details and company's today a against CFO, and initiatives to CEO, open operating its

As are Statements statements deemed expectations, call a results call future about contains be actual reminder, this forward-looking conference may events and differ as may on which forward-looking and nature. materially. in this

company's today's GAAP well SEC time, be meaning list to For or website. I and a measures reports business non-GAAP call. turn inherent its reflect all Today's call call the XX-Q. SEC on non-GAAP presented occur Shuldman. of of Form to measure the the the When webcast accordance circumstances XX-K the this include comparable forward-looking the undertakes any measures G. over as Bart to to events in on with the revise filings, the reconciliation financial most risks in financial calculated as required, found to a or no within directly obligations that will and Regulation press including company, full to and statements TransAct At update to of release please financial and can company's would like refer after Bart?

Bart Shuldman

conference welcome joining call webcast. this and on everyone afternoon's to Jim, you, Thank and us

was million, million, XX.X%. per $X.X and TransAct share. quarterly profit delivering quarter adjusted for quarter XXXX EBITDA $X.XX of $XX.X the fourth net of $X.X generated million EPS fourth margin sales a gross the of Diluted income For operating of

everyone will our review hear and our points the and XXX Steve TransAct's in more detail want by XX% net the share recent few grew XX% margin moments, the year while from gross expanded of per For basis I'm call respectively. in full about launch a on earnings BOHA!. will sure income me profit by results diluted but to

give right and So BOHA!. a of casino get then me you our quick market into and gaming let overview

gaming a we we particularly generated come will their XX% of quarter later had support this global of on year. shipments casino the Epic growth market Europe. gains, and large XXXX our operator first casino in For In Edge which sales global in business, continued US, the year-over-year the printer opening, share in to ticket-in/ticket-out new new fourth

remains business in of established Edge As attention, as next barcodes service direct our sales resolution offers take a system. the and driver shopper as share. XXX graphic improved bonusing as TransAct’s print printer customers operators our respond to of imaging such applications ticket success for Europe EPICENTRAL our reminder, Epic and as Epic team to which using printer allowed additional our as casino generation XXX acceptance Internationally, our such our better well key a for technology high level has DPI

key XX% our represented We initiatives. product cash grew and a $XX.X sales market. gaming before, to as good had and casino year, full year very we’ve our and development source we the which said a in deployed For in casino million, have flow of gaming

milestone ago, of industry. development needs evolving Okay, eye on team with of that complex a several close our celebrated days restaurant and a few now of debut to a years on food represents BOHA!, the BOHA!, service the

that solutions to thought put to time, significant full TransAct sees we some this significant the and demonstrate was range their and are listen we a said opportunity have we industry in initial market a excited BOHA! to to for As debut of needs comprehensive transformation SaaS manage the ecosystem of best that companies restaurant needs. to apps these service hardware we food house into believe back and is the the how dramatically a of will and address restaurant change cloud-based business of BOHA! how operations. our solutions solutions clearly

As apps with hardware four in to we kitchen the the the come for solutions and to first have hardware and vendor can time bring launch of tasks. array industry that and software market a offerings, of only is suite nine digitization still single applications automation of integrated wide

by have only historically had -- Importantly, solutions a by market’s address portion needs historically which vendors. conversion, what of that single task created we single the been spirit the been

into effectively back-of-house We complex workflows. and platform to cost harmonized that easily have will enable technology automation a their developed deploy into customers and

it's back-of-the-house labor time for devote experience. continue no operators. more food to costs customer Furthermore, centric As service restaurants it seek food is they and and creating a guest that to secret rise

survey BOHA! tightening Well, inflation feedback of the believes lot to keep front-of-house lean on level In in operating And labor effectively. will this on of had to majority the labor fact them labor dynamic their and they protect staffing guest of negative X.X% the operators X%. were: samples respondents only in To-date, staffed experiences rising that providers a costs suggests mitigate and levels technology the analyst issues. agree that costs. increased environment have more of deliver with are a to that into optimal a the struggle restaurant running execution, Two, ago. recently regarding Among create and restaurant helps implications profitability. investments the survey takeaways a thought, and address efficiently mitigate they levels operate expect rising XX% scores. in to staffing which XXXX, food And better has companies staffing published that the sub compared businesses this lower on enable service traffic impact Three, finally, to industry very put as market effort covers in to of head that in and compared have our better conducted acknowledged investment very fully solutions unit to Wall trends on survey respondents survey intensifying customer done a pressures key year XXXX. Street One, inflationary October, as see challenging may analyst asked order a restaurants a operators labor restaurant about company same-store similar of with his

their food BOHA!, roll be are alerts team and interior the streamlines for of industry BOHA! the back-of-the-house. The point up customers’ provide like and the here coming the tracking temperature bears end-to-end the would accounts or attention easy recalling do Prep procedure needs monitoring maintenance compliance to by Service, Together by Sense process. sending and range. impresses monitors of and think do temperature and to scheduling service. barcodes, Checklist food connecting but and in help process with solution our setup sale refrigerators, the same temperatures fluid increased repeating metrics BOHA! tasks, provide a freezers time cloud walk-ins every BOHA! food with designs Food of and hardware first restaurants show and to and a allows is automates and It market to the manages step-by-step in needed digitized the related kitchen tested, very the how to scan storage that use array the test, a the BOHA! Labeling set inventory to opening the menu it with process BOHA! system. reorders out review Inventory monthly Food step-by-step to thing list to to Now service that with measured can we of based of work voice to manages I show much preventive food unique recognition. apps. temperatures me label an calculates the and suggested for we create Temp when the employees tap allowing are ensuring range. company completed BOHA! tasks. users to Recall of should by day units strong is also temperature receiving be can to daily for providing standards. each operators also not we prep out its with on use, to for BOHA! easy completion ensuring with restaurant’s from equipment, streamline with only closing inventory compliance. BOHA! of and for guide procedures sales day food maintenance

part a for Labeling operators receive, can menu service approve and edit, customer recipe for Service, purchase approved also providers. maintenance additional And As feature videos. an an pay BOHA! from BOHA! and of service can and additional request equipment

orders Importantly, multiple that own the pairs are of we dramatically have delivery through that with receiving whom an also app the developed their to Delivery received BOHA! providers, managing platform. process operate technology and each delivery third-party of Terminal BOHA! simplify

demanded we As eliminates have multiple believe operators. must the and become a for for tablets it BOHA! printers, and need by those Delivery operators will

revolutionizes functions home, restaurant extended made real of Gateway food on which device to include terminal. available monitoring and the Long BOHA! time the and updates apps TransAct while TransAct of updates approved while display. its refrigerators can larger with The IPXX enabling two Range handle temperatures are Sensor and and WAN directly to only device year TEMS, compliance particles side, our that handheld offerings and deliver food hardware technology ruggedized the that Handheld water and screen the security walk-ins key printers ensures to BOHA! food companion label aluminum. thanks and in BOHA! to especially over is steel battery the allows full the Terminal its Management and software designed the accommodates and at is inside and that Enterprise allowing On BOHA! labeling, casings System ensures touch shifts. freezers preparation for the its kitchens. signal service communication

closer and We and Every capability ensuring developed they get ensure solution the TransAct want we customize differently, have customer they between customer for with it, that the developed and a and of the customers. need. our relationship need place teams that our who restaurant, to a our what each driving exactly the manner they BOHA! manages and in business our the software solution enables to apps provide sales we deploys

to Steve, before over provide around Now want we bit context expect rollout. the to how a to BOHA! of turning call I see

model transition want you business If you've to that to signed know software invested themselves their manifest in contracts takes financials. and sales it in SaaS, for license the from time fully companies

over time business The to transition through TransAct our SaaS-based that As hardware instead of this contracts historically sales. new financials traditional of will sales built value flow upfront. the a around has see company

subscription expect associated a our long-term turn in fourth term we this agreements. review a of customers, model to that, business begin those for path believe to heavy the the absolutely We from for a greater multiyear we the the recurring years I'll the to is some then BOHA! for right sales questions-and-answers. record over sign I'll the over we begin to company as XXXX sales call expect the recognize new call As which drive coming and over sales ramping Steve? with up fully make After of software With and with XXXX result, deployments agreements revenue summary expect results. the the opening remarks Steve quarter pursue profitability. before to

Steven DeMartino

XX% Fourth down Bart fourth in Thanks good were sales and from net last million, everyone. $XX.X quarter year. million afternoon $XX.X XXXX quarter the

prior fourth Epic were Domestic down casino game market. The to upcoming Edge Epic one XX% AccuDate to up or gaming at support of of our by Restaurant prior solution installation Sales to shipment XXXX new of in the markets XXX year-over-year Looking reflecting up sales the in first decline international customers. well large quarter our a of by the Casino $X.X to driven sales our lower sales our casino were in year as million. terminal. were continued new XX% from $XXX,XXX of direct quarter. year-over-year $X of as our opening million XX% the the of new XXX% success operator year sales printer international was declined inclusive over benefit EPICENTRAL. sales domestic driving sales the for

million were of the the we pace see record existing been XX% XXXX XLXe in back quarter. newest sales levels banking higher $X.X terminal XXXX to was sales as what driven POS end did have across AccuDate of printers customers declined their POS The also now. Sales the the in decrease of to the Epic zero some of McDonalds down locations from our times the expected by continued sales deployment quarter. three slowdown for to fourth in quarter. However during printer and automation nearly

Lottery printer our As banking and any sales $X.X completed have market $X.X million million don't of exit 'XX, of future from the forward. of we from down expect the going end our sales away decline higher and in growth and focus we an customer prior quarter from the our year shift ongoing primary to as saw given our in market expected markets. this towards lottery were shipments

were on sales $X.X of to declines in product a a million a we of XXXX spare we spare part in sales increase gas recovery large sales to sales in $XXX,XXX continues. as sales $XXX,XXX year-over-year to these still lottery was to Printrex well an legacy crucially in XX% a fourth ago. lottery flat for in XX% Offsetting AccuDate year sales and continue quarter, products. in decline TSG oil XXXX. a down and As of a modest flat to customer the of as in continuing fourfold decline international markets consumable Despite as with terminals. part sales result, our expect sales increase label sales expect domestic essentially printers industry decline were grow

will in shipments sales contracts. beneficiary TSG be labels terminals line As in growth and we last and AccuDate support terminal beyond AccuDate quarter, Overall these as sales XXXX we with noted primary grow label expected of through service to terminals. of with AccuDate are

Our all thanks declining fourth remain quarterly gross sales margin to quarter of for products. time XX.X% the lower near margin highs, of

As TransAct’s technology go our to of driven improving is the forward margin solutions products which business hardware we’ve for software bringing the centered terminals. we're a market BOHA! quarters, sales several clear around our of said such on demonstration is and as profitability these of of ecosystem gross terminals past model, and the

quarter were December net Like year $X.XX $X.X sales, of a or period. share year the diluted sales diluted XXXX per BOHA! of and quarters expenses compared margin million, declined Engineering per expenses charge for signing lower by quarter. year in G&A nice fourth partially in and hold. Our million as solutions $XX,XXX income 'XX quarter quarter. quarter the as distribution or cost recorded stat law expenses restaurant in design of fourth of of the our further $XXX,XXX X.X% XXXX tax gaming the gross support Selling offset software $X.XX to a loss take in of gaming quarter essentially hiring and tax and in year-over-year. $XXX,XXX time our a a lower income income and ago fourth the the part savings of were of were our agreement result expand quarter. design Act new new casino Europe. income offset X% $X million deferred build $XX,XXX 'XX our the benefit to to for our the of Suzo-Happ rate. $X.X year's to small the development could XX% the from revaluation on drove selling X% with down in the share corporate was the $X.XX million XX.X% tax fourth down contract of by solutions tax operating model last Operating the as fourth Conversely, the the engineering benefit or impacted of we in few to ago in or or and XXXX compared support $X.X fourth of over tax We recorded in or assets was for line Cuts were due with in quarter sales 'XX new for Total to expenses product quarter, quarter our for fourth million as the of net the termination this of costs taxes direct solutions by prior XX% from to Jobs new 'XX, last in marketing EPS negatively late ‘XX, expense products. and additional casino $X.X Tax our loss

quarter would $X.XX in earnings of of have we per 'XX. share charge, recorded this fourth diluted the Excluding

per XXXX on fourth to adjusted ended cash and quarter cash approximately EPS fourth total repurchases. both So to shareholders for $X.X of was quarter a we to 'XX quarterly sheet, And the 'XX, was in EBITDA capital debt. quarter in share. million the quarter share of X.X the million $X.XX of shareholders of quarter of 'XX. million the through fourth of in the finally through 'XX. with $XXX,XXX compared Adjusted the in of balance of 'XX, basis, quarter for to and fourth $X.XX an $X.X returned full fourth and turning $X.X a total our million, the we dividend dividend And fourth returned We the the year no

We our have approximately as million X under remaining purchase of XXXX. current authorization December XX, stock

recent most be As long-term we launch of the move into TransAct XXXX, for our will and shape future the company's is of important driver growth. taking BOHA! vision

As contributor operating to per expect SaaS-based earnings and over we growth, to our our becomes software share. revenue expand time, sales margin the largest

it sales significant is and growth. will But noted, underway BOHA! of the for for ramp have the the some top-line TransAct Bart positioned that our company take As and success. confident we're long-term drive transition we time to to future

Bart this point, give like remarks. call I'd the So Bart? at for to to back closing some

Bart Shuldman

is This for very Steve. Thanks, time a exciting TransAct.

and as ecosystem this sales exciting time, with At working total the needed begin multi-year to been what been commercialize inflection want the share around tirelessly has But I their operators a our current center have clear TransAct. Following be We convert how BOHA! market. out our as food point to it educating marketing around interest certain our contracts process now contracts to will to makes initial working solution you for potential business ecosystem reach they the and and something this set we could and can us we BOHA! to feedback industry to tell and well offer the that to benefit service have we speak before our to to sales we and thought around And will marketing restaurant excitement alongside investors truly Now well BOHA! take we customers. to efforts BOHA! can executed deployment. BOHA! full teams launch BOHA! the on a that and customers. to want. see and

in top at and members is view we where York of meeting full BOHA! investors. see investor New On to will hour demonstrations at to showcase begin where and responsible BOHA! and demonstrations between the a Midtown day planned have in questions. you for April X:XX anyone have commercialization. will encourage day We its and X:XX BOHA! for Hotel and each a pm meet We the Palace the The development our the York. come New to ask XX the we am welcome teams come ecosystem of will of ecosystem

I will scale up of opened good think this view day this full opportunity give for a of has TransAct. BOHA! the

XXX-XXX-XXXX. result will to future additional JCIR. you of interested shareholders. information our Rich is firm publicize hope Land see attending, creation Leahy reached And be our We on there. day future on TransAct at bright will They you in are to for execute reach to Jim if our in the shortly. out Investor to can for The significant value new I of encourage Relations and ability I the you our vision many or at

I every your passion quarter. TransAct I ready TransAct it questions. trust. thank for team we your truly makes is also their As what Operator, shareholders for take our thank your and the do to is. support work. that are I great It

Operator

instructions]. [Operator

FBR. from comes B Kara question first Our Riley, with Anderson

is line open. Your now

Kara Anderson

Hi, good afternoon.

business the you market ahead the other respect on sales just in all launch? in of the quarter, fourth at have wondering if terminals you that restaurant the efforts pulled solutions BOHA! the back with So in to

Bart Shuldman

quite high the most were more deal it's labeling, outside back-of-the-house, about do We've pulled about can of the talking our back, just customers were high multi-solution. labor, to to some customers time other the digitize XXXX, we buying talking the terminal want this just are back-of-the-house. be what the in No, of were cost a ones of to been and they to a want cost I that that for not interested in help the us with solve automate food don't they of to done having issues think and

became would BOHA!, for trials for starting for work the that our us technology. that of with occurred some wonderful actually have sales to the of turned some So BOHA! customers so into opportunities we're

I’ve and don't that said many we look, it call, So this really more. it want was really industry want times was the the restaurant we just a on said, -- terminal,

over the two were the almost so for scenes, And more course behind restaurant developing years last the of industry. we

Kara Anderson

the of think the we So going same the lineup? additive ecosystem being and AccuDate then should product sort customer rather XLXe. to BOHA! kind replacing of than about an your It's after

Bart Shuldman

BOHA! XLXe part now. the is No of solution

-- XLXe a the So XXXX if allow that we into cloud-based the a brought would more announced the inside everything terminal able us single bring reason a the to labeling but just remember XL you why we to cloud year with ago about just be solution that was out have to do than the terminal.

began SaaS So cloud-based migration to the solution. XLXe our a based

our management TransAct enterprise is In fact, model. TEMS, which system a is SaaS-based

when buys terminal buy they our upgrade and marketplace issue the -- above called or system security ability And come them based must So the to attention. in that's every TEMS. somebody SaaS they to our to a XLXe, should monitor able being

not the now the So XLXe the of solution, solution. part only is

Kara Anderson

terminals Got at you space? customer the thinking target of of type just all, number if full ecosystem. talk bit within about you the targeting it. what clarification. maybe customer the about BOHA! And new functionality? for sort changes you that would little the the of Can given then a be restaurant for And Thank the

Bart Shuldman

Yes.

industry food stores, the Kara, wait just they issues. preparing food. taking fried they its freezers refrigeration? $XX,XXX, convenience of serving potential So chicken, But worth the do Do it's you. food cooked? want that your refrigerators it customer for in through too loss service monitor? Anybody fry hot. because thank is restaurant Once it's while and need Should being temperature need Great of it’s temperature or not a to XX restaurant Every Yes, That's freezer minutes a it’s it’s in providers, the you supermarkets. it’s is $XX,XXX questions, before ships, go lose they five a TransAct. you have you And serve. -- do fact, can't do to goes great you to customer them chicken, now, to cruise food same example is it’s lot Are taking? the labeling. industry the refrigerator

-- every BOHA! you every is nice start two is one So can apps. customer convenience restaurant, The ship is a a potential customer of thing or every with store, about every cruise ours. potential

I’d you You software. app, manager, that's you add ability do for might media what add might could a start an the with call our labeling charge to videos, labeling extra

You might I'd simple same solution the say a just at because of refrigerators time, a let's in do money. put to our that's freezers lot like and sensors what, that could save us

Let's they're doing end-to-end start something Two an can an maintenance with do that. different call Then preventive let's of preventive service. then maintenance totally should apps for provider. automation combine go service their that and talk how about to going break and to solution if

like we We starting are now and management. then because another who that us or do then with inventory idea. right are to we'd do and out with two that about to We might are recall, automate and to So want to let's able we companies can discussions app recall. another in add one like talking being that like we apps the app roll first do,

the you So it's apps to apps you And nobody the and today to match that care. an doesn't other ecosystem right ability whatever mix now there's with that tomorrow. want allows add

out the temperature taking there. can app find You

want different five portals, checklist company about. a five could There different these they've tablets, about with they can. don't it. be restaurant of there. every But met a Think told that out and us think lot You

go search right? did want the that and could to people do Well You that to to app hey, you to go. and the one and got closing one be that you go portal got you got opening

app temperature different to going So a Delivery ordering. subway to different going in to of great restaurant, and handle the back a pop tablets a to a five in a is portal different five go do tablet. see the I'm example, I'm online taking, with and

Now that. we help can automate

we about to need the restaurants So feel we drive very good that. it,

fast-casual, from from restaurants So way convenience find talking the ships, every customer a preparing whoever of they all the too, can the we're the quick-serve, customer today it customers the casual to, we food stores, on have TransAct. through do that that supermarkets, potential the is is McDonald’s cruise

Kara Anderson

about -- you to we from costs, five the can all? using at if are And how with hurdle for talk perspective, in about I what TransAct to switch solutions devices should like the switching different the that to them guess five think one different over restaurant what's if the back, operator's solution they

Bart Shuldman

in the now nobody's restaurant, of restaurant. really little of right the a doing back back I automation on mean in So anything there’s the right? going very

want different only of in one Those don't have notice because you companies company, doing to So we’ve talked implemented offer on all too restaurant is while not might that they've delivery companies, companies multiple had with, be because The restaurant they them people and restaurant are though. they might most using different anything the if the not solutions, tablets it's the cumbersome. back delivery the call restaurant.

restaurant four five and are tablets. companies using Some

yes, it. we would would we replace So there, but simplify that,

most ecosystem implemented anything. to labeling, apps that's not of has we preventive sensing, other companies tab, nobody that that, nobody maintenance, the For are all tablets that inventory, have new, Kara, and the has we and all talking restaurant the this, have

Kara Anderson

And order further details then provide could any on secured? just if the initial you wondering

Bart Shuldman

it I going yet. you first, that locations. that X, term this what we'd investors bid away these -- color it, customer order. And even to stay give No. say X the XX-year we’re of are going We're of through then We'll and to got some buying. opportunity. We X, clarity but they're right? roll be about this about. to people think see point, to contracts Not that probably first out think mentioning at It's that something is hope on terminals name, opportunity six talking like. looks a going until order. our And all to if to from they apps like of to we we our nice And in if wait get contracts how be to long many their

X. So X, could time many apps? How X contract could is this that this that metrics of able to many one over to be? be our to investors want be this years, explain the we would how What one be terminals, financial yes, one

Kara Anderson

about of And should additional be of the as combination really way a think adding then here And BOHA! we from features in further kind development development. app? would of through

Bart Shuldman

Yes.

So, companies down to of we the of think we've that needs from talking restaurants. of us, worked developed. have the we've addressed apps alongside the we're that pencils standpoint In multiple now a

what we Kara their function restaurant But way restaurant we every with we the should the need they or temperatures, we that tempt So other designed -- need, they it's what everybody methods, app do different cooked. no would is to under every procedures, right the company base they the different now need customers be to a same gets. don't see app does work got runs over -- different they've or have have way, is

So geared customize solution. customers is ones each now already to that we've working the highlighted team and with then those towards new to our able be

you to Oracle about a software it, Oracle a install then in think we this find bought had system about it. we VAR think put If Like but we way: when it a from

have maintenance, they tempt exactly the team temperature every do just exact and We sensing, they so and to. the what how that preventive -- system of restaurant how VAR take want to want do will capability them. do, solution company is those can to want inside how craft way engineers what We the kind restaurant engineers is sales how software take, they they want our they that that our back for they software And of does we company. to play our our using their they we that companies tasks, learning sense then information

app Now way in we the create flexible. were that being able in to

in app a wouldn't from while. another should right So see say us now you I

I was the decision it apps nine. right me it our let they wasn’t that enough And think us for X now. tell is nine, you want market told it

they industry they have if nine want. we done the the So would attempt when are also. that functions But told these they wanted, us it would restaurant

Kara Anderson

the sales lap gaming sorry then you I seeing catch taking kind to Can speak direct? not about expectations and gears just of shifting if and I'm if as sure your sort it. XXXX you in you Great, missed maybe can European the -- function But been up, quickly. for casino Steve. from of spoke you've I'm you and benefit it

Bart Shuldman

that? address to want you Steve,

Steven DeMartino

No, we it, want I Bart, Kara. sales the on call the didn't about side? didn’t -- talk anything mention you well to about

Bart Shuldman

wouldn't Sure, I Europe. to again. that see of that significant share kind market I think in And we've gain gained expect

like the should issues regards with think is lot about and the be we're seeing I a consolidation. called lot in right about. of that. some what's all payments industry honest those Clearly or consolidation, around a now that things of all gaming issues what we It's a growth customer casino slow to of market

share our expect to industry to levels growth we've would had I go Europe. considering the back gains So market normalized casino in

last got into why not many is the years. many the great. cash opportunity restaurant gaming can start industry, how up grow We restaurant us got for that it growth the great a are on adding that going this solutions into how billion. we we'll $X it be truly solutions. terminals only you large. important planning is to $X more level Casino had out it's is over over we and But to It it's is casino to see why industry decide. a rolls And business but how can the us, the over is there? always because so to many Just deals, out. that When to flow to not exciting right. and restaurant why Kara for us TransAct. but It's US That's that billion sales truly EPICENTRAL have, SO that's a apps that's so in in market is

Now apps out are why You’d terminals to and how a ships that and and many on focused it's to we're there? look be stores very many could supermarkets how how it going how many are then they many many many make restaurants at cruise how and for convenient okay large and that’s say how doesn't buy? much it. for us, opportunity So very, somebody so

Europe. very a We We've Asia. in are We fantastic job casino pleased done share and in business. our our gained with gaming back

were against so competitor, I We could we each haven't done but things lost solutions we're very our positive. are industry. great it's other And why share all gained fact our the in Asia there a opening US, why And that growth five, we're not so if Asia in honest in of think a too, focused that with in market on lot about can We've in going on six new affect other a be years. and we've restaurant excited it. that's so businesses

Operator

Thank you. question next Our with comes [Operator Instructions] from Jeff Bernstein Cowen.

now Your line open. is

Jeff Bernstein

Bart. Yes. Hi,

of there minute granular a pipeline kind outlook on what just is more you little but little an having can detail? of You a give and touched EPICENTRAL there, bit for a

Bart Shuldman

again bit it at Yes. not spending regular kind put I'm than little what reason makes marketing sure, other back we're Jeff, market why pipeline And I couldn't better, a of the on sense. looks does. and

have not opportunities. those I So it's it And restaurant kind been of it's we it's and working. in nice differences industry, of Again at must excuse is to more like have, the me. looking one successful see a has are where it

I'm pipeline the if So sorry? better, looks

Jeff Bernstein

same? it Your partnerships, those with still the expanded vendors have is game the or

Bart Shuldman

know system. inside how to are have communicate that the people we things EPICENTRAL the well Most rolled printer we set casinos how to wants company them. SE there they part that proving system have don't to a They with it. slot Those backend need. a us up and is but out that systems we EPICENTRAL Yes a talk don't printer. of our a nice to only of not ticket with a a and where to promotion to system And that are providers one and add all don't couple partnership our develop of design

a what did small decent system bonusing system. Now we they with one a had but companies,

to that's responsible some decided the a a And our incremental print become gaming. certain topic on and for use US. is design responsible year to Europe. play, b play. and things And Jeff, in to way there a of system responsible big we're and thus somewhat EPICENTRAL that in its And for We're manager owned able seeing multiple they also company bonusing play casinos manager rollout to drive casinos. their were with So at topic a

something also for the the there responsible requirements that is So that can that or system things has the system, look gaming. to meet do driving country’s that because regulators people can that at become are

Jeff Bernstein

SE And to anything that? else add Okay. EPICENTRAL about

Bart Shuldman

was us. out rolled We systems. good for successful it project no, a a couple No, of

Jeff Bernstein

years and ago, gaming, blip or to maybe then now non-exclusive just are three, they to and is your went in how pretty guess they with Are lottery And you we ago, this about someone buying should was GTECH. going service are four it is years for has revenue couple parts now, a now of -- I buying from start thinking there, a go good else now be or away quarter been from and that? IGT,

Bart Shuldman

extended the extended. it, I problems But in probably We Yes, a were low think in that not there. was meeting us. of a about the talking such be open that company points and and Jeff, business perfectly that being to kept very, If Selling not made yes. the we some is honest of were took And contracts about it's regretting the a and it. order no have interested wanted no price supplier extended They they and they're having. because to margin sense margin, printer the second as

sense and buying revenue they make just weren't is restaurants that will lot different they much them new So continue versus printers, spare parts. design and which But thinking it that doing for were many of to buying at software, solutions, about forward spare anymore. buy to didn't but parts a looking new a us recurring any margins,

occurred so -- just BOHA!, were thank a time say the no, lot it we to that that to of to us you. starting sense So made and do during

Jeff Bernstein

but slowly parts, should is that be modeling -- supply kind to we So the that? of going how off or of fall spare

Bart Shuldman

I would at it that look way.

know printers We there. out have, I XXX,XXX XXX,XXX, don’t X.X billion,

is or jackpot XX,XXX printers and because it'll go us. depends not going But for to a keep away. weekend. on all it So out, our a day running tickets timing doing good are powerful every mega large it's

Jeff Bernstein

with then SaaS BOHA!, and at explain need that model forward -- of there renting cash like. can look what should financing revenues is And be right? we're any the a pay, be going billings thing revenue But this? reason build you're to to to any and really kind I those them we get on values all we look We the get understand revenue doing how getting on subscription that works. upfront terminals. terminals, as to looking we right obviously, like out into that of kind That And deferred see terminal not

Bart Shuldman

Yes.

will all be not the if hardware sold. most So

Nothing in be have a period. one that. to roll we to customer up that's five-year wrong a selling would monthly or over all We asked deal, us seven-year period hardware with it deal, the happy do in

we the is that. I the just our already do looked and wanted deal, they to monthly at the the would -- market SaaS we want [figure]. to can’t I've because do So the hardware that us is But going that with to up wouldn't be a roll It software. there on the then say a one believe in buy software where hardware

Jeff Bernstein

of -- here to just years back -- of of years, et the it ago? But think three cetera. revenue. $X in get where up recent safety the segment million was kind has there’s just obviously we worth And couple food to been When transition do we

Bart Shuldman

we're if to X, that X, have over be you we're So sales is think going right? I build all going Well, know period, this will right? software that, going Jeff, the or roll year to we XX what, and you three in, X difference or where So now could to very will go to be compared small it builds out from before years know, were where we're seem apps. two you multiple years because three I selling itself think we on all

a the business be was. than is what it So I potential larger think lot see to that

Jeff Bernstein

from are but what get your a obviously market. million hardware kind XX in back X talking big of months about a or, right, I'm hardware thing of selling we before Eventually it many to standpoint, just quarter just such multiples it'll I'm is be thoughts? worth no Yes

Bart Shuldman

and to us a thing to major something, an the opportunity this hold business put opportunity large some is never missed before. we're large our a to they that a This our to Jeff, of is a opportunity. for in right it's large through I've interest by quarter I this this am it's been give not on a very or significant involved ask to it's change in going now projection. best you follow I in the us I shareholders appreciate good and to don't this think stay game transition. number to an out if want to Look, and

customers prepared with So job, I said get work taking This we made we've all the that not customers we've been so the to was to got trade we talked show doing planned launch could the we has it. our that about get They don't inventory with problem, that we got have and get ago we get sit and do seeing, one so for is Wow! vendors said tempt all could think major mistake. all show we back, just want of dealing and the of that Association an a you'll we a that time a have have This to see NRA. news we've was out long far one, be problem what NRA. we what us but need Restaurant -- these a different National problem, at is

You've it. thought about

January And that's when need to if important we is some wake up backlog of I looking up the us to we're on be the down wake I at Xst, sell, we're and think going TransAct to we've what's done to lights going get recurring can that a and market to revenue. think and have to revenue. right we about X% it going go of a now. for and dinner, sell it's another be change major turn and recurring calculations, Now

Operator

turn any any closing for to would Thank now back not Shuldman to call at like this questions you. And Bart I'm further time. remarks. over showing I the

Bart Shuldman

Look and see the and displaying do why I where to to further We to the let product so at hope forward back afternoon. lot of us everybody we're kick on the progress. reporting investor our showing this and also a April you joining you we on will see XX you tires look be call I day excited. appreciate

So I for everyone. joining us today's call. you Thanks thank on

Operator

a does participating gentlemen, today's disconnect. today’s in Everyone, all you and thank conclude you may and have for conference. wonderful This Ladies program day.

TransAct Technologies (TACT) 6 Mar 192018 Q4 Earnings call transcript