RSSS - Earnings call transcript Q4 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 Fourth Quarter and Full Year Ended June 30, 2018. 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 Web site.

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

Peter Derycz

fiscal good with our our operator, and to afternoon, XXXX, and a fourth brief you, open Alan call everyone. pass Thank the results then about few comments quarter to detail. the year and I’ll in call greater about speak

business return will the and quarters steady strong I We sustaining first ended growth initiatives XXXX reporting Transactions business. in to Finally, Platform and note, our experienced outlook. in address other we the three a on momentum our fiscal our in

to deliver the and we a life working, Gadget builds I’d delivers like solutions specific Our and to academia Factory, to Platform allows to launched underlying smart mission performance. users technology, efficiency industry accomplishments is to out organizations us fiscal our to which year, and of strategic our tailor our but verticals. in point the workflow apps sciences, beginning couple At

innovation evolved to since Gadget a Our has framework users, bring to nearly and component our then satisfaction. customer and daily of our critical is it attraction, retention,

enhancements gadget Gadget We and hundreds since launching the have gadgets of built Factory.

subscribers grew hand deployments the customers’ X.X highlight annual build committed markets, these making XXX and in to market as Platform their Our we a Gadget few in by time efficient. as accelerating to working therefore continue our penetrating medium-sized call. small to on active revenue with new business come future. of more this nearly I’ll of customers year Factory at money; research XX% XX%. the hand engineers it from further comprised underserved gadgets million and Most We later this of ending and our vastly that is in and gross margin and cool recurring the scientists save remain a research well

quarter, fourth excellent platform sales X.X take and customer almost We on every we to retool steps more acquiring receive Version began ways focusing our of the Version During migrated to in to and marketing X.X we May, Article continue of feedback. successfully customers. and Galaxy launched to departments, efficient our

more the this While more early beyond. even fiscal in and to in shortly. innings, about impact began plans have 'XX our this excited have is strategy say on results, it still fiscal and to we about XXXX our will I are

XXXX. significantly As was a happiness improved of our in in a business, on new and detail. to selling XXXX, our to other lot Alan accomplished as the and shareholders, level a marketing. before looking innovate providing QX work exciting, we’re Alan? our In whole fiscal fiscal reorganized and I’d new for pass to bring whole, well level, return this investments a to flexible and our customers our We took to to approach and results I simplified technology team. fiscal call an through expand and upon as place to walk satisfying, to our like But initiatives, and and

Alan Urban

non-GAAP today's year-over-year. terms. in Platform Please increased a with XX% our afternoon, sequentially This into Peter, The by quarter see translates in and in net and quarter driven deployments press up $XXX,XXX XX% XX into our good Thank new how XXX. X.X annual QX. recurring was Jumping XX% which fiscal subscription Platform right deployments we to QX define fourth and results, million you, revenue in revenue increase everyone. total to for use release revenue, recurring and incremental Platform annual XX% ended other

growth X% year-ago same to was revenue driven X% count in X,XXX. total to X.X quarter. customer million compared the transaction to This Our by up was

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

Moving gross data margins in proportional points compared saw was margins, basis quarter. increase costs. the to by on XXX to business driven XX.X% our by Platform to increase year-ago same decreases gross This third-party

points up XX% Platform gross XX.X%, we points to to the increases Gross low and take Transactions the continued XXX remains business as margin gross same target to primarily margins, business. efficiencies. the our shift Our in Transactions our to mix year actions range. XX% cost basis a increased to Platform and in XX-basis-point ago Consolidated price and increase continue quarter, was high business, our revenue XX to to compared XX.X% margin in to improve such margins due margin higher basis

totaled negative continued to Our share or from compared compared $X.XX million quarter. to due the positions. the XX,XXX million operating total negative in decreased $X.X expenses open operations XXX,XXX ago to $X.XX share quarter. of optimization The and same loss per negative totaled net resources year and sales same Net primarily XXX,XXX year of compared negative the XXX,XXX $X.X in to marketing to or ago quarter. per in a Adjusted EBITDA decrease was loss continuing the year-ago

it opportunistic we and adoption revenue adjusted believe customer future year-over-year could to accelerate improve, growth continues Platform remain we to opportunities further growth. EBITDA if While

and the all receivables no continues [ph] XX, at Moving on and liabilities. accrued deferred This million and financial payable, revolving the June of June balance line to $X.X nearly XXXX equivalents turn expenses, remain to clean of back our at of accounts to borrowings all million under summary. I’ll were and amounted $X.X call completes There representing Peter? now revenue versus XX, our cash balance our credit, our XXXX. and comprising outstanding sheet nearly Peter. assets with to sheet, cash our

Peter Derycz

more Thanks, Alan. spend Platform time on I’d like to our business.

mentioned, growth As the strong we this continues. business in

initiatives. key upon by executing two to sustain expect We this momentum

customer additions continue First, experience. make to with the will enriching we that user provide framework an

in importing and between Version X.X May external between useful collaboration efficiencies and and exporting powerful platform in mentioned, databases we and to the features enhance As new launched improve some live data of they went gadgets groups and Congresses further and the these our work gadgets, and I sources to through of peer-reviewed publications. journals can researchers where own search congresses information. One learn about which allows gadgets submit is of of research research PubsHub example thousands their Journals new or

early it to research it work so collaborate Additionally, allows in Manager groups. October, with even them, that will gather Drag-and-drop well around gadget a added way plan such gadget Records to Records gadgets as efficiency. in key time Version in X.X colleagues now We research and create that any as in into other we are can be important easily launch be functionality gadget ecosystem as launching of our over an that’s integrated organize and October. in to to Manager users their functionality

summer, to the Although go this the live in capabilities early all we self-registration finalize the we release delayed Platform. aspect and version to would new structure ensure properly pricing of of function expected initially the

daily mentioned gadgets drive will future. and we capabilities also will self-registration more have be new previously, will platform frictionless and efficient in This lead new deployments we will Version feature believe a the new basis. generation which X.X more framework As enhancements that sign-ups, on launching gadget for allow

new will the all suggestive Platform. Platform, and implement our be users gadgets the to ideas on submit that create able to Gadget users to With gadget can Factory

and may Our super we functionality new in within specific for Platform building exceptional believe requests to will with gadget-oriented and a never deliver allows thought experience user ultimately collaborative experience this the to improving agile verticals. that be tailor gadgets the us Platform. of, response systems to community customer architecture We customers highly new our have the

to a and but investment way our organizations is returns. that Second it in continue our to reconstructing our only optimizes marketing efficiency not way drive do Platform momentum growth sales and

We Sales van this hiring announced fruition new initiative we as and Officer; new our Georgel, are come seeing Chief Erkel, Marketing Yohann Rogier recently Chief our the Officer. of to

In addition Shane announced new own veteran happiness led to by a activities members, team our a industry group Hunt. we customer into few consolidated those

leader Platform new educating are and grow existing their events sporting group customer experience possess as have world’s major marketing, sales brings gadgets released. XX in for and most Our providers information. is as our customer be knowledge deep enhancements Yohann lead to in marketing medical recently world. proven most the to gadget These groups; senior ability marketing customer a over on in global scientific, teams. director happiness respective driving technical will of well the team growth upselling fiscal in brings of customers and dynamic years fields marketing and of focused a Rogier engines Yohann across and sales leading sales of and recently direct one expertise, sales, providing beyond. PrimeSport, over for experience three Elsevier, as management of access and Rogier years digital their Both as happiness in and and serving XX the retention the three XXXX

With these the our sales digital helm we and through anticipate generation acquiring customers two and efficiently more content departments, sales at marketing, marketing management. focused of

focus SMB leaders further and for in Platform focus work marketing new As solution on businesses. our expand becoming penetrating and billion R&D-driven key the particularly rapidly X market, we market, a underserved crucial will sales be

led us find and the by with in will years cutting-edge group continue business. for gadgets, to that Platform us a by positions over Version particularly sales Operator? activities ensure that home the Platform growth our user With and our and Shane been and to sales to happiness and quarter the our to registration happy XXXX. leadership features the strategy customer drive with fiscal onboarded has well marketing X.X six upgrades, marketing to for a our believe Platform Q&A. on now we who Our track year new that, customers turn our penetrate our new summary, the indication in and XXXX expect with new our operator along restructuring with further results ability dollar We In of remains into for I’d market. us. like These of multibillion this Platform, self an suggest to call fourth continue teams, the are strong fiscal year momentum grow back and will

Operator

sir. you, Thank

now begin Instructions]. We the session. [Operator will question-and-answer

from with Our first Capital. Peter comes Please Artko question Rabover proceed.

Peter Rabover

you guys. Hi, hear me? Can

Peter Derycz

can. Sure we

Peter Rabover

of industry of follow Peter, do about wanted of to instead it novelty? XXX I customers, the up. what proof kind you is of magic have mentioned you a be a will number just to guys have for you I this think that what a point think concept think you think as At and the must-have Platform –

Peter Derycz

using think the are that at it sort our rate of churn manifests this in I negative Yes, must-have is for point. already a customers it, that itself and

capabilities. we’re we that of can for prove So, in get I group, I with the think lot our new terms users going have self-registration new market, to that wider to a really categories but yes, of think of just

close think pretty and are capabilities is to going self-registration the with performance to I indicators these in key measuring live, interested ramp categories and up what else regards So to providing different of and buyers. we’re you in the everybody

really sort users, have to users, workgroups of paid We’re like going enterprise. have to we’re free professional as well as going

if be think all think So, in uptake different I upon, enterprise spot. be we good so is to see we’ll some expanded I going and categories, in a these

won’t I enterprise only enough. think measuring be just

some I on the have data think we’ll categories. to disclose other and really collect of

done enterprise We’re matter become looking customer getting or in we just which it or haven’t no I’m to thereby making past. a looking why we just for and – a time of my in X,XXX customers. have the a or XX,XXX shouldn’t me, mind, X,XXX reason easy at X,XXX It’s

Peter Rabover

or maybe you could be will then for of as of your, revenue proportion rate guess, something a like you And kind the think normal great. Platform on no? Factory? meaningful that run Is a a expectations comment the I contributor Okay, revenue Gadget

Peter Derycz

just way responsive Yes, the is for super market. the a to Gadget to Factory be us

module come they to And system, I so, or tried it’s customers this your prospective customers isn’t onboard, lacking this thought it when in say, oh, was. new I this what button. and use

to say, oh, going We’re great.

find that or to there will to responding may We’re and that lacking not responsive can only to the to make think is that’s very, want Gadget they they customer a satisfaction, explain not designed to like be in large, respond at or get a because responding product find is, take will that that what taking to that. the gadget one prospect to so they platform there’re lot the that that we what would or exactly us probably more is we a it customer see very quickly what the what quickly something. enhancement, and one suggest but Factory that, just Tell people customers if the to time like time missing we market evolve a we be our us to gadget be and

Peter Rabover

developers apps gadgets guess – could putting be your on other of that or for kind you’d where you generating I you them on revenue platform be to? Would Okay. to open open

Peter Derycz

three-stage sort a built have about we would we out build was our that let’s very a broad, so when and it was of strategy don’t from it Yes, really existing based the lot, that ideas but we say I call talk a feedback our on customers. on initially Platform,

generated call So X there’s I internally would idea of generation which idea, lot a of around Phase here.

app date the suggest that X.X a some of and future you, on so customers mentioning now, a Platform, of infancy see help I X Phase build And tool. a Right Phase we’re that marketplaces Version is the can barely do why in why great. our see X, what way, X. This not we’re for kit put that’s a their of out, sort development, its call can and term. is, after then, development them our gadget a you’re framework Phase With own submit is hey, our into here some but like they what do have to way X entering entering we’re out useful just launch long approval cool just which community to build I that and as not gadgets the sort gadget more which platform don’t ideas. in prospects the other I that’s of make time but do. the with still I people well see could market SDK future, on are We like think But do help I for it Phase see can just a these I what software

Peter Rabover

great. Okay, so appreciate much Thank the you for I color. it.

Peter Derycz

were These questions. you. great thank No,

Operator

[Operator Instructions].

Please comes proceed. next George MKH from with Management. Our question Melas

George Melas

and you than answer. sales. sales it’s way a hopefully are of or Thank enterprise Platform When the to quite you. a SMB terms are kind Hi, have on – making or potential of at sale What part Hi, level? a I making are enterprise of question the approaching enterprise, Alan. Peter. they probably that In different the replacing you is application? what whether and the hurdle prospects, in that’s

Peter Derycz

as the what our does Yes, a that’s feature are start I into and question. lot unique Platforms gadgets we a all that more and it’s more think solutions, and are say becoming and developed would good running I homegrown in so functionality of it becoming the unique visible.

a think So, I it’s really matter of people yourself. building

try are lot tend then staff a that where small and to as situations have and some code we other of pieces So of they we custom up. pieces have setups it, written those do some some that have companies it of scale but break they’ve doing they growing to down of types

articles. There And just we’re so, selling I some think of where part say type lot of are a our staff-driven we in replacements processes. of see of competitors the transaction let’s and business homegrown

don’t that like on efficiency properly, can our of the they want enterprise of is case, so arena from marketplace and the anybody in want any open well. compliance. compete publisher, piracy think as we we yes, too piracy to as So against do and where side in any buy article deliver But can most an things a highly that well as they platform help that thing good compete also that in customers

there so And do and different of of yes, bit that pieces here piracy, a of competitors do-it-yourself and few a [indiscernible]. categories

George Melas

And homegrown elaborate of maybe will platforms? so built they Peter, greenfield SMB because corporations homegrown but that take quite larger haven’t really maybe almost field platforms greenfield sort is is time display sort some it to of have, not these Okay. but the why

Peter Derycz

think now There sense I a marketing. in that biotech, and it’s – of Platform. we large about lot of names a all of lot historically, large lot Right of they’re engineering. customers, have lot our Yes, a of do pharma, that are big ours aerospace use customers large

super provides. I from perspective industrial what from Platform functionality is security and Platform call and a a that the future authentication from an would it So perspective, strength the

around lot what It’s what up account they’re anybody we’re big we’ve tools only during there’s pharma. XX going so that’s XX that doors. big for our more about not have them organization can a so customers signing How like – the can businesses. that and them democratizing So them and marketing. going not target we an the organizations. these a on And down Platform medium-sized and the we we to are there. of there’s into is the then whatever find doors right of get medium-sized runs lot we but think SMB, and by we’re But to companies, small can so small big and marketing the we the that the on, marketing which why who doors do? in And that to in so we’re knocking we places new setup so many become sign can just as And knock customers reason and in self-registration that All we about companies call, of about thousands a we’re really customers way are, is driven of up, also, sales up. that hundreds on we then Top out from and mentioned know we’ve different they research-based us the of know organized find I the enterprise the find way doing bringing many sign people capabilities get away. people And knocking

George Melas

or collaboration intercompany just of maybe really sort And so of Can one academic is it done institution be then companies collaboration. quick it confines of the and enterprise? an that Okay. whether companies sort workgroup within it’s on be question company or another between would across

Peter Derycz

the security, to in find our Yes, so on. and be of authentication, strength areas data we security corporate

so So one the corporation. researcher let’s of cannot we that think of build we walls researchers say actually scientist can the at strength collaborate competing organizations organization and a is between and with application our scientists that and see

for silos, feel is our do building efficiency that one each strength we research So organization. in research-based

if come keep like keep in by doing designed their mind, in mind. things the to for invite that. is nature keep platform But that, Now, to into there very account to mechanisms and they mind want confidentiality are in each its research authentication other security and

George Melas

much. very you Thank Okay.

Peter Derycz

You’re welcome.

Operator

session. At this question-and-answer concludes our time, this

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

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

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Research Solutions (RSSS) 20 Sep 182018 Q4 Earnings call transcript