RSSS - Earnings call transcript Q2 2018 | Research Solutions, Inc.

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Operator

Good afternoon, everyone, and thank you for participating in today's conference call to discuss Research Solutions' Financial and Operating Results for its Fiscal Second Quarter Ended December 31, 2017. Earlier today, the company issued a press release discussing these results, and a copy of the release is available for viewing and can be downloaded from the Investor Relations section of the company's website.

Joining us today are Research Solutions' President and CEO, Peter Derycz; and the company's CFO, Alan Urban.

Following their remarks, we will open the call for your questions. Then before we conclude today's call, I will provide the necessary cautions regarding any forward-looking statements made by management. information company's provide financial of also information. will regarding use the non-GAAP I

like that Peter ahead. a remind be I the Please company's to Finally, would go now will everyone Solutions Investors of made turn President for website. CEO. I the over recorded available this Research replay in via to link call section the Derycz, and will call and

Peter Derycz

I'll and open comments Thank pass the with afternoon, you, operator Alan brief business and a our to about call everyone. our about financial then good the few speak call to results.

will address return Finally, and I to our outlook. details other

transaction Our platform's continued offering, robust and showed second year XX% growth our over year quarter strong in business. based growing a helping our SaaS support revenue in quarter

transactions to has last of March walk to Alan. who'll and but detail. first in with X% our upgrades healthy Alan fact, about additions our I'd XX% our results forthcoming early user the will on of pass margin by look combination measures grew I XXX X.X customer migration improve several registration in quite platforms self a in and of expansion to revenue A proactive to the more like the experiences Version this months. live feedback call We positive. quarter forward growth say implementing and have customers. other growth gross Galaxy framework completing by continue been fiscal and major like the next our in through and effect. gross points QX in basis the in transactions second Article we platform total year In have intended margins went to to their December place put

Alan Urban

annual was our QX. see This incremental a Jumping deployments by XX% up good with right XXX. driven recurring to platform quarter on to and platform a over X.X annual translates release ago year terms. which to XXX,XXX for how growth afternoon, in The results, the basis million million net year count year recurring was deployments Please into Peter quarter. you, revenue to in define Transaction increase platform XX% other revenue use XX% total driven increased revenue Thank in This XX% subscription X% up ended we the revenue by to into to everyone. and same compared XX non-GAAP X% customer today's press sequentially. up was X.X a XXXX. and and

customers transaction a were we same to was addition, academic versus XX% in In count to X.X in customers million revenue year ago XX% up XXX growth corporate approximately X% up increase XXX,XXX. to the to drove of the X.X this million Together of and consolidated Together number X% quarter. XXX. saw

gross to decline margins by driven of our gross the this platform. our addition data new business margins by platform basis XX.X%, to on decline saw Moving points that XXX our sources was enhanced further

addition data offering sources cost the a and create these new investments believe necessary in valued for highly to of the of short While we revenue differentiated customers. term our are increases our

XX% range. low gross in to the platform high is target Our XX% margin

basis XX%. gross Transaction's our to Peter XXX mentioned, As was margin up in business points

our to to ongoing including increased margins, our mix a Transaction a are to revenue XX.X% improvement. year-over-year due higher Consolidated shift cost XXX Our actions margin and driver business. of same the key growth gross to price to business the increases basis Platforms improve and quarter year-ago the margin reductions, margin points compared in

per content acquiring digital loss of quarter. the to lines quarter, share efficient unchanged ways totaled negative and share in EBITDA strategy $X.X compared generation the Our expenses negative inbound compared with same our and total including and resources million year $X.XX more reallocation in the operating through year quarter. compared customers expenses to the operations of were sales $X.XX to ago optimize negative million or year-ago of at marketing. continuing net $XXX,XXX $XXX,XXX our ago $XXX,XXX Net the loss to a totaled per or Adjusted from negative $X.X and

have in and grown we results, noted prior quarterly a strong opportunities business platform at significant have we believe today As and clip remain. our

momentum our large accelerate at can we ahead we opportunities of be breakeven fiscal to adjusted Given us, the the in adoption more EBITDA if believe being future growth it even of have opportunistic in XXXX. expense and further decided opportunities, customer

to platform but arise focus penetration. we may the opportunities Now certainly to invest further profitability we will prudent our to flexibility have believe remain that a it's as in look

and June XX, Cash under balance were no $X.X credit. sheet. There outstanding were XXXX $X.X XX, Moving of our million to line versus on revolving XXXX. equivalents at December at the million borrowings

to Our balance comprising nearly all Peter. with expenses, cash my liabilities. call continues payable, and and of representing the back nearly This and assets our sheet remain now I'll revenue clean all summary. turn our completes Peter? to accounts accrued receivables of financial deferred

Peter Derycz

our to on business. Thanks, time platforms like I'd more Alan. spend

As mentioned, Version live X.X December. went in

a also It tab computing and controls, features backbone. the screen new getting storage include view and all full work literature of gadgets, the intercompany one to will administrator adoption our enhanced of help an article out gadgets, and of Some gadget deployed features more speed dashboards, in-depth to groups. our data which improve launch of of customers more tools every instant search ordering, and on roll scalable

migration has wave positive. customer gone first smoothly The and the feedback been of has

the completed the complete more two March. migration of was that additional be It by ways set have framework will improvements. end We for of two this will stage plans

and summer We are and X.X Version calling X.X the them in coming spring months.

users powerful launch tools geographies and will compel to that the gadgets features will with tool help allow group These their users other interested for be studies list researchers accelerate fosters collaboration and the publishing we the a also colleagues. combined user may scientific or which groups research. tools which quarter amongst will Next reference This more researchers. in, of X.X management greater

self-registration tools export Galaxy and easy researchers This Version our will unique system to feature one X.X in differentiator improve will flows. features another day collaboration will tool use summer. platform. Article work into between their be connectivity built daily of have live is import external our capabilities early our will go yet and Additionally, databases and the in cloud-based super unique of it and

As this launches stream previously new we constant efficient lead will generation call drive are self-registration more and innovation allow major of platform we apps smart will even which power discussed, gadgets. delivering X.X with Within deployments we're believe X.X and versions work framework weekly transactions, of enhancements. a powerful of frame more

factory gadget is daily. Our in swing innovation and is delivering new full

from With Article us an agile functionality. new Galaxy super architecture customers to allows be customer we’re era efficiency. levels entering in our X.X gadget-oriented systems new Our to of request being entirely restructure achieved able response of to new help

X.X We each a segmentation results. way version sales we're about measure measure our their the greatest the and productivity and or and capability and pod further Now marketing with have to our recurring effectiveness departs this marketing goal prior sales best each supports comments looking around efficiency function. based This believe will will to will focused to our improve yield of upon our and optimizing on to resources discrete the made the reorganization and path, include self-registration we the is purpose activity. return we’ve

unfold. January with this we the particularly building year the platforms Looking upon our a XXXX calendar to remainder as strong began of year momentum our look business. in to forward And

investment back X.X X.X the to With this conditions our be also that by returns. will powerful be produced only expect And driven and by for Q&A. gadget weakly We and favorable to department optimal but efficiency factory. call like version and to drive refining the sales operator not would now marketing improvements at turn I the a we're

Operator

first [Operator Instructions] Peter. question Peter comes Capital. Rabover go-ahead of The Please from Artko

Peter Rabover

kind the customers a migration wait sign think new until I you before you’re up. product will do start make new question; with version you they the to release

Peter Derycz

all, Not at think don’t all. at impact that its I

Peter Rabover

on elaborate and types may the that potential you about. invest then about investment -- in you may to you can returning thinking talked some maybe elaborate breakeven, you investments Okay so of may be your -- on guys you're you see before can

Peter Derycz

online going to agree contract live implemented come own, go in has sort a individual of with our that get self-configure. or we're their sort the any to or on for right has we as version means process streamline of card, get up, version have that’s where to can with that's own, which up sales to sales and we a customer to now written put system on What a terms we're their intensive sign credit big sign to going with to workgroup we're strictly what rep, their all users come a today, which up interested launching and ability now a we is know enterprise is, and on has on process do talk contrast and then on and have a labor doing X.X X.X users you the to

products accelerated little that's of version And and marketing front opportunity are open what to being new this really we about out that’s if it we find that and That's fashion. work generate X.X self-registration investments that to roll we works when really talk through so better the learning know bit approaches our works, sort new talking basically invest in the to capabilities. of what create probably at we adapt so, an maybe marketing really a you what really with arises ourselves doesn't ideas, of inflow customers what we in as looking marketing through demand in to more new an for or something new mean we about,

Peter Rabover

version so stuff hearing what expect to them or hearing market get the those from savings reinvest other check double and less get guess into X.X just activities with higher it that right? expect you to is and margins there's or because Okay, you is sales I'm I to associated I'm what

Peter Derycz

In testing something then be ability working. find environment not I think that that -- of months have metrics old such we foolish to marketing ran or run in committed with full ads today's market a investments we'd ability make you you have I make we page ads are works, of saw driven test that and and we marketing Yeah the think do digital I and pursuing an social correct, avenues we happened. advent few and magazine a to guess particular when and investments marketing journal to find and digital sell. in if what marketing you real additional for and way to a the to social how

Peter Rabover

couple do forward, Fair enough is think just had side. investments would last guys that the going see margin million the gross that you would have run we or you rate on increase the that X.X where quarters so more of those and

Peter Derycz

sales additional expense. marketing and be it'd Yeah,

Peter Rabover

will are talking we think like what low seven you those figures be? looks those Okay, figures, high do just six

Peter Derycz

we is sort if driven. We of investments those know, type will driven they they'll don't of be make all know additional -- and number we that that results

Peter Rabover

had you with where if mentioned strong you but maybe why parse had asking you January, could keep from? that and I came a strength out sorry then and Okay, you it, the

Peter Derycz

have we reps that Yeah, signed had revenue effective into January when sales contracts so is catch pipeline think of December good. well think and and probably the pipeline request with the start if you things recognizing of then on, contracts obviously so I there's and and January I and of month, we're yeah your from system after January a CRM some holidays February feeling looking strong of because interruptions well, really so dates our a this and pretty are in looks in going happening terms great as any the which I all comes December so sales look contract good think maybe bit up in slowness January December in is

Peter Rabover

And have breakdown corporate the between that had in and you that the past? same kind is of academics

Peter Derycz

corporate, the side we most the lot business. -- the say I those of it’s of mostly but have I'd think really platform the sales transaction on fall academic Yeah, a on additions of specifically

Peter Rabover

push then been and you through has side, increases I demand of transaction price pretty that any on back, any has think smoothly? the that loss gone Okay, mentioned successful,

Peter Derycz

and with didn’t say think at like I we want done to that once the renew we it started break over of I we do price of so the Yes, base so time and sort of all board we were and would so it, increases they as across parts the go so X/XX initial at far good. a we're year so if contracts looking when customer yes a out

out is by of think so supported best to and more transaction pay the the then to there we're business what that's do platform able there not do I value, we reason have more you best business for we of terms do be and in a transaction the on can no side. what increasingly

and value making So now getting figure pay the too, how exchange. sense us powerful out for to to is it get to platform and for more just for more it

Operator

comes of Instructions] Partners. question [Operator Billeadeau next The from Scott Walrus

Scott Billeadeau

be kind the or that just and and difference on little the business understanding couple bit and just you platforms be of can proceed little self-sign-up, in me kind a you for they shops you what maybe would one heads-up One, card into credit would know or thinking go talk is the of use do based you a I there a if large of a talk are it so are ASP about bang monthly don’t on and Just subscription mom pop they us as as about there? fill on you kind bit the it’s maybe things. of especially of no organizations, a until platform sea these will maybe little my give on cannot

Peter Derycz

we charge at invoice it. signs to and size ASPs so let's already our now out businesses slides on smaller The say factored and as tend going as it's right we happening Yes, been once to the soon average. $XX,XXX platform into customer just all under has it the certainly contract, already are medium average that's

We our who of product lot organizations getting a with before. of haven't we a are contracts lot remained

customers driven them big which Of we've customers we activity we office and there, and scientific a staying reasons big out our lot size a love help the customer seen base. big and haven't a well. are is the companies us large been more with that's scientific names small we've registration of one been course, up many as to as and there part the are are of there But medium is of building enterprise from lot platform and

now other probably add fluctuate up going metrics down price So the see what to sales think I will you have to say doing up are to but what will are probably of they'll signing be as metrics be terms you a you seeing be of on we from and some who so what we metrics that basis on little to well, come clarity additional will bit and more and you the ASP -- users that, going as a that with individuals, on is feed groups new on they a close is but new up in new will to we adding user add we work be on paying. feed and few get a reporting when basis so for not because we're and so they'll are reported on to are professionals self-registrations will I number but

Scott Billeadeau

are they it's the is certainly certainly that want on do platform once they I'd so mean you individual balance ASP, the For on they to of your what get to entry a to a matter that got I so plan the what's fee versus it's is transactions, can there, thoughts transaction there? game get

Peter Derycz

lot great one There say transaction, study transactions say that a buy the article work work organizations sharing, ability obtain is managing, going lists is to of a around creating credit and are that’s card groups of whole flows around reality one these have the let's of issues lot a or to that in important, of and studies just on pull but things so matter so the transaction out collaborating.

But day, so, And are buy the subject or to up about what people caught with transaction are some that saying we on research. platform we’re understand what need t doing read okay, able the doing with they to get a the be study. to with their else else

all those need platform that to parts saying also on of around part the and their part well there day, with to so, the the up development are of terms other platform. their there researches But at of the the studies and have larger things platform study with we help going ancillary with we or be building And world, whether of looking and know day. we if of we're day, for more activities we're their connect in that things other that offering that's so people sort going to all at get the the know looking okay, will scientist on reason to, we're involved and platform other what in efficient

Scott Billeadeau

that you So, if to to opposed drive incremental add you we platform can stickiness add we a some and huge of module is the that. Is value transactions if strategy this that the piece mainly introduce more the there that, of XXX add or have? for hey, there to create is just a something you is platform, the it guess incremental something this get as or to an stickiness a can month like or I

Peter Derycz

that pay more more think provide for looking they return deliver think us to are help all value customers then innovation that. both, and that that compensated to into this I it's platform in be to deliver the seen I so will we’ve more, value willing

we're all in stickiness end and we user is big that see So, the and are thing then definitely tools with users driven once more putting and a will on another have more end a turn already for how the seeing gadgets collaboration us, new we negative to which see more in already going and we we're our data data will platform have rate. you platform stickiness lot

it in really sticky on we're sticky the users which So, around means reality its more making useful world. already making but end to focused it more

Scott Billeadeau

hey to As kind we of couple for come X.X, beating you looking two need the base, any us got hey the platform, just solve thing, has from user X.X, for out there is certain, that big us are this big a things thing, on things. been these everyone are in

Peter Derycz

on. all a That’s management consolidate think out that are tools for such one, of the stones the of of why the were whole be they and and have looking is out bunch versa. the but a want tools niches X.X and there of we us I use research are us reference is innovation any development customer have don’t driven users other big seeing that and and flows sort lot management molecular that very that and and our revenue big the do a of we're with our innovation deliver know biologist there and so one And the genetics One that they gadget to them and a lot within that’s they to that coming the for so on frankly that’s platform development to we community then example. sort that them that big are geneticists because on, to molecular has to environment we vice gadgetized niche to scientific there that’s means are via a of we gadgets, biologists what able of that something work customers and doesn’t screen

Operator

question time. There are no at the more and questions This concludes session. this answer

deployments, as performance. from that Before would presentation expected results statements statements operating management's of company's and in this They which events forward-looking growth Research include, cause not the to, update because as lean call regarding isolation financial guarantee or during of non-GAAP also considered a products the limited GAAP by information accurate provided today's Please not in will detailed non-GAAP of by could and and at update nearest economic not their relating to the time statements made contained the its and related plans, forward-looking SEC, Exchange The the future and but of financial factors, and continue statements is to described of Statements Accepted in assets use measures ability the during XX-K of in on this from not services statements suggested for continued with acceptance faces substitute time about expected are made general in time by measures at not good today's product will future include of also that in are or in achieving performance in future organization performance information. company's respect are and otherwise faith earnings the the all information company's include, any are more success events Important and company's The execute statements Securities related risks that market, statements and/or expansion company and company's Form acquired the or and The to very refer cause financial success a Examples as obligation development, to improvement global prepared terms call contain or continued differences the to to SEC. such the future that or stay necessarily GAAP. with this a are Generally the U.S., presented whether management Form harbor defined be in we referred include measures The quarterly call, filings new the transaction subject integrating company's in the company's of accepted with are statements no acceptance Solutions' XX-Q. accordance a to the model and financial presentation the information business be belief results should few release. information efficient obligation company's press the by on in publicly financial and non-GAAP of or or is risks the on financial intended but and forward-looking of deployments, of in the Principles forward-looking Platform conditions, the the market report company's and obtaining reconciliation and to the those regarding company to, available discussion expressed measures Accounting and could forward-looking to otherwise. customers and the use presentation changes in and and the achieved. the limited events success no be information like regarding cautionary presentation. annual I to results statements and the Platform conclude well competitive in provide interim forward-looking the in factors Commission, indications as technology to to statements strategic important and performance information, at as that made includes information will or the that safe interpreted cautions today's the Such that based entities including forward-looking statements. differ and Today's undertakes time. financial uncertainties information materially as actual company's assumes future times revenue barriers new growth. be products greater report to company those company revise today's new

Finally, like will that to the press joining recording release Thank I would February for the remind of instructions. for through available and call us you after replay today's today's be XX, everyone refer X p.m. to today Eastern Please for presentation. dial-in XXXX. for

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Research Solutions (RSSS) 14 Feb 182018 Q2 Earnings call transcript