DUOT - Earnings call transcript Q4 2019 | Duos Technologies Group, Inc.

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Operator

Good afternoon. Welcome to Duos Technologies Fourth Quarter and Full Year 2019 Earnings Conference Call.

Joining us for today's call are Duos’ Chairman and CEO, Gianni Arcaini; and CFO Adrian Goldfarb.

Following their remarks we will open up the call for your questions. Then before we conclude today's call, I will provide the necessary cautious regarding Forward-Looking Statements made by management during this call.

to Gianni call Arcaini. like Chairman to would CEO and I turn over the Duos’ Now, Sir, proceed. please

Gianni Arcaini

Thank you, Jessie. joining us. Welcome everyone and thank you for

families First to effects heart our the impacted many of and devastating by goes coronavirus. the foremost, the out

shorter and we prayers our I'm remark will may be keep you news your on little loved a ones. today's Our thoughts priority with than mind your and not are usual. sure company today, a so

a as results issued release fully quarter Copy operational. to other is At financial Relations the additional release Earlier for announcing operational on available this press point, company results plan Investor we provide commentary our section our and remains shortly. today, full well highlights. press the our fourth of I our in this year of XXXX as website.

customers. you property. sophisticated As improving to of solutions ultimately continued wide measurable systems. portfolio technology end, broad To as a we create analytical highly the which typically we business of advanced investment. focus range know, deploy a our technology we been a develop we to solutions strong with turnkey processes provide We In proprietary for on return terms, simple intellectual that technologies, have on of provide range

includes of centraco. shifting combination increasingly platform branded with our as intelligence processing applications image facing advanced and software machine data to as backend is our focus a as learning, praesidium and Our technology well deliver and we video deep advance and as which suite, through customer artificial middleware analytics branded capture that

proprietary are software note, in-house. Just all a side our developed applications of and

applications. mission on focus operational key remains security, critical inspection Our and

estimated billion. infrastructure in transportation, $XXX rail Our markets law sectors. target core market opportunity critical include addressable enforcement total distribution, markets security exceeds the target predominantly and our combined retail the We

platforms system our aspect not customers' is technologies In core change differentiator A of strength business practices. chief that any adjustments one major require requiring to various to development, architecture. our and verticals, do calls is our to minor technology and the significant adaptability addition our in our

to strategies up market critical set long-term increasingly volatility market be and diversified address Our to segments

can confirming I a quarter, it now for business for that performances can January, estimates both a Duos. published on that I And originally and as in our In from achieve the don't high XXXX In XXXX this our as we we a the now be business. we note. we it afternoon, published see say hyperbolic preliminary were to ended QX fourth transformational think update, whole profitability. results truly would was year say also to that record you our

Our in results for this million, $X successful resources resources raise unprecedented will us us which strategically Earlier our our necessary this earlier expected the continue in growing current long volatility. the provide greater the with business to more than year necessary with of announced over validate and the cash particularly quarter allocate increase provide capital the to demand. will to face reserves decision year, we to market the meet a fourth term,

Market. In Opening privilege of proud for Bell. the the this had development strategic recent collective listing, very making goal for the us, at Nasdaq February Nasdaq priority a has our reality. our has I'm the exciting most and of listing up Duos the also multiyear to Being been the That's teams Capital a been national with exchange up a we ringing connection listed ceremonial

new story our List, spread national to we select covered broader TD on The to financial are others. eager The Networks, audience. exchange, a widely the With listing event a to new opportunity to capitalize among was Ameritrade media Duos including by on Watch more

our financial Goldfarb, further go into Adrian for who to now the us my quarter for turn will I the I call results colleague over through fourth CFO, Adrian. our before Now the updates, will and recent year. walk

Adrian Goldfarb

is as of calls, revenue you, of majority previous XXX our how Gianni. I result On last beginning discussed our a have at adoption year. the the recognized of Thank of ASC

quarter and each financial Technologies the should of on now noted the are discussing subsidiaries that Company the the accounting be basis same also be represent truevueXXX. the with of results Comparisons and Inc consolidation Duos I’ll

All the AI expenses. subsidiary investments of in our operating in incorporated the are new Company's

calls, As policy I've principles recognition on using also discussed ASC revenue our input of XXX the based in is method. the previous

year quarters in the to XXXX. for the fourth XXX% total in quarter turning our to revenue The the $X.XX to of timing of million, portion our and result quarter Now was increase by business significant full equivalent maintenance driven also million in for for partially and of the the revenue XXXX, contributions support. quarter additional the financial increased results with projects previous total and was $X.XX fourth strength shifts compared from technical current

million, in XXXX, period. increase $X.XX Gross mentioned gross XXXX. year revenues total quarter the or was equivalent $XX.XX X.XX million QX full project increased XXX% million, year of in from revenues, profit was revenue equivalent ago the which the previously driven the positive from XX% in and or profit an For projects. $XX.XX revenue for of million in of compared XX% increase of in by The continuing was to new effect to revenues XX% increases the increase

the revenues, to revenue gross for positive with certain which is X.X recognized gross year, year, full customers XXXX to a margin an XXX the impact of compared covering contracts recorded prior XX% or was temporary ahead are overall trend. year on costs increase XX% revenues. of We the of had ASC margin a or compared full million for as implementation overall the The in of million increase XXXX. XX% of year for an profit X.XX Gross revenues

support to scale customers, by and The technical and to margins in impact for continue increase in a revenue from positively revenue the gross new gross overall anticipate resulting projects. with both driven economies years, the increase We sales coming in existing larger margin. of for recurring certain maintenance will and improve high

to increases in increased X.XX revenues XXXX, in QX expenses resources year, same the from period, million the our to reflecting in XX% X.XX period increase in for costs, quarterly the the as related the well selling in million line in last Turning to by related operating additional operating investment marketing to The driven the new business. increased as with expenses truevueXXX increase our grow expenses, AI in resources resources was and which subsidiary. mainly to

for million year, full period increased previously the year For quarter. same in the XXXX, the increases reflecting operating XX% X.XX to same expenses X.XX from mentioned last million the

increased increase laboratory slow is the in rate XXXX. for of to platform, AI the new as also training the operational as human for expected headcount We for new machine the resources This of development costs systems. truevueXXX well learning

primarily $X.XX higher travel. costs share, a of Other We in were result a in in loss of XXXX. income the per and the mentioned expenses of general net recorded business administrative same share was revenues quarter attributable in operating a loss to a increase Improvement net additional net XXX,XXX $XXX,XXX more in to period. as in negative or in previously non-project than covering QX project recorded the or XX equivalent compared plant per increase related income

and the attributable the net truevueXXX compared or loss center. year loss increase related Florida or share million period. expenses machine loss trainers same $X.XX to primarily was in The X.XX in ago R&D development the to year of a loss software million increase learning For loss net including was $X.X XXXX, X.XX to per in contracts an per in share, full at Europe staff net

used the now million earlier In delays of discuss to and of in million. quarter cash equivalents also the $X.X as $XX,XXX mentioned. increases impact had project $X sheet. the Let's receivables balance we XXXX, and as ended with in in We we due cash year well operations headcount in cash previously net the

Company listing shares over must items ratio be requirements housekeeping the price of a common At the entered beginning at at we of XX. comply stock year, one that for transactions January, into new a few connection higher of executed to our up the to listing. split the listing, this reverse we call $X of with A before of in with or our of exchanges’ Gianni. time which of first turning Nasdaq a In back a series mandates X stock

statement securities listing our Second, February effective on XXXX, S-X declared relating on proposed our up registration to Form XX, often. on SEC one

listed Third Capital the Nasdaq trading stock officially ticker XX, onto on under symbol Market the and began DUOT. our February

XX, completed price underwriting offering an an February underwritten $X million. share, at and Proceeds of exercise commissions option discounts of stock to common on our public deducting in Fourth, prior we of total offering the operating also resulting of X,XXX,XXX of overallotments per $X.XX shares the expenses. reflect proceeds gross

our website be for filings the intend purpose. proceeds marketing Further well net working all with in to these Investor as from can research for SEC. the transactions of details and activities, use We in the of capital general the and section the Relations found sales and offering our as development

provide to financial update an projections. our Finally, on current like I'd

which approximately based contracts for previously We that provided performing guidance be are have XXXX, in the and throughout over XXXX. would was million scheduled revenue already represent of the or of guidance and XX% to This backlog an executed million pending on orders XXXX. $XX.X recorded near-term increase $XX course

majority to identified viability. The as customers infrastructure been continued of our essential as Duos and connection well by have

workforce our considered the is a As under result, essential rule.

could be currently substantially information resulting would the However, the those the revenue the XXXX substantially increased in caution to that do like delays read would travel we revenues pandemic, execution, COVID-XX due actionable half year due from of comparable while below in the potential uncertainty that to not to suggest in place. the year, period project of for guidance restricted we and the of first have the to need global because environment

double annual expectations we refraining in we providing robust more information expect reliable until XXXX, While still available. updated are for from becomes to generate growth revenue digit

back I'll business, over Gianni? Gianni the that, the provide And now with on call to update turn an to

Gianni Arcaini

highlight with an well on for activities. one implemented wins trueviewXXX own Adrian. as we rail or time thank track. year, wins. In XXX,XXX successfully year customer Railroad our of January some as of a this our major you, Transportation, now provide Inspection CSX our who for Class Beginning first in X first achievements operators I Portal Well, rip of seven combined miles will operate the of and the record full-scale the and Rail update

their featured After safety, to technological CSX, by renewed and completion, and improvement the video expanded commitment portal a enhancements. was promotional published highlighting in

that cutting and they CSX shown working highest committed our As efficiency. an buyer level technology remain the to safety generation customer, to Duos with ensure existing first edge providers of rip, a like of time has next

algorithms, phase project the CSX's initial coming intelligence over process. of the mark of the when installed addition will of initial includes completion overall next The artificial this which months

also scheduled obviously month this at that's a different is in substantially completed we Next, site or for end rip today which final the of the acceptance Mexico customer, another with before tomorrow.

transit XD state-of-the-art pantograph Overall in engineering call of launch of for an industrial Chicago. completed rail the tank Duos’ -- at system and significant on location in of a version We automated beta we specific apis, with our individual we version technology also test of so installation focus it completed a of version inspection a QX, portal Michigan. in installation car inspection our recently of

generation provide truevueXXX for completed platform, mix centraco the which at launched When next a serve market first group. other we mission learning of opportunities Finally, our develop our operate and beginning will in we the and many will only baking current to of not verticals. AI security intelligence pursue we subsidiary logistics the base customer deep applications. also additional truevueXXX but quarter XXXX, artificial also and whose is truevueXXX, machine

and during of operational XXXX the market We for model has February been the fully our the XXXX. subscription now fourth year staffing completed launch a quarter based goals its began investing truevueXXX few truevueXXX late of in now. the into of last by resource months end developer

of with development comprehensive from us allows which platform, is our the our third completed strategic we recently, independently any consistent to plans. AI which operate Well parties,

from next migrated this As to year, the in provider platform the at fully operations end our third we’ the of truevueXXX party platforms. step program, our

to target are means, now with completed, our expand intelligence incorporating that into this artificial beyond and several heavily the market their are space What AI operations. platform well our we are verticals comprehensive rail able applications reach

AI of expansion out point we to to business professionals. program. strong also includes of development like our team software scientists, January dedicated I team data would our built a Effective plan XXXX, and our AI development, very have that

innovation we to a team of working verticals new is for various technologies number develop Our serve. the disruptive

revenue In positive expect month, of XXXX, base both our in our drive to operations overtime. announced and contract recurring we XXXX. we to the contribute significantly coming initial the innovations further begin have new mix. existing contribution these a customers expect recognizing additional to and from quarter with first and in which beginning our Long-term, growth revenue truevueXXX major diversify should expect third revenue to truevueXXX We

to in current suggesting subsidiaries as we point, this our in consolidated information continue truevueXXX investment have on would more I statements. no our we included before, have provide The our year, actionable At to color all usually outlook financial and the that a previous change will make for and guidance. stated

the worldwide continued we developments recent of potential economy. of implosion of However, our of must address course a consequences

even all Obviously, continued of and usual. projections have impacted than making more the economy aspects to been be difficult

to maintaining of customers, our while constant all a remotely, fully our and in majority business ongoing current communication with are currently we continuity of ensure plan We staff and is have are the in place working functional light put conditions.

our to this success information we XXXX. still the grow build on we from currently have, expect and on Based significantly year

Operator, please the And with ready to instructions. are the open questions. that, your provide appropriate for we call

Operator

time session. conducting we ThinkEquity. Instructions] Kumar Our be your at question will of Thank with will [Operator the Ashok this you. Please line with first question. and come question-and-answer Ladies a proceed gentlemen, from

Ashok Kumar

and Two and relatively address to revenues long-term revenue forecast you. first of Good Could have do it is it drivers those you in questions two new Would to and the be And initiatives and safe as ASPs of original XXXX just afternoon, industries? Thank uncertain? the is. Adrian the place to margins rising things your Gianni. is the million. that say financials, timing in you the your of XX support

Adrian Goldfarb

part take Thank question. you, Ashok. I'll of the the first

necessarily systems as to because comments, margin, in into prices, now So an more addressed a but our gross AI of not price. of getting the lot extensive, are I move increasing selling in That's are current configurations in improvements we're increase overall as related the the my we sector.

certainly did Of and course, year in systems XXXX. we're producing more

economies gross an certain in are that. drives that more we margins. there increase scale little with bit that get so, as come And And a of along efficient, overall overall,

our original question, going We in of it. our I your exceed guidance that a lot this very any Related in take to obviously We meet terms we're to cautious certain of the comments million of so bookings second maintain place, detail which and analysis uncertainty think were their part around guidance the XX statements whether whether seriously. extremely there's given. much time, that at we're that about to show guidance. being But or addressed

year no than that at mentioned, actionable time this our I million make we revenues first equivalent for of period would mentioned, just uncertainty. other to information As to because lower half the are the there's the that. likely Gianni no not probably And on change last there's than as XX further be say would that prudent it's this us time, comment at any

Gianni Arcaini

is our a higher function to pipeline of We million, geared the as Ashok. a on XX but towards example. what internally the Adrian you actually, follow is ability caution Yes, that much customers said, an given have really than

people have of were quarter. not like we customers do changes people Kohl's companies hoping our as in sufficient the or other the because would active don't of tracks, flag they allow workflow logistics immediate to go Some where part help some to revenue coronavirus first to to the the others of

Second down quarter XXX,XXX people. the operations put time closed. shut for being. TJ Maxx They Macy's. obviously all They have like they just closed

hectic. that believe We revenue in year, be So We negative quarter impact believe and impact we what significantly Last we are that will to we just like of fourth staffed this us real be looked are adequately. almost and delays. quarter third don't fourth we potential the our doubled going it. because will the at

bell, cautionary know at all worldwide. read going point time, as want note, but the in to a on what's don't just So alarm this we you

Ashok Kumar

orders this macro headwinds, is related the to a longer the take Adrian, due to to could is takeaway, Gianni execute? purchase bookings there the and

Gianni Arcaini

the Sorry, could you repeat Ashok? question,

Ashok Kumar

takeaway of to is bookings So, the to take purchase the the related execute? longer macro because headwinds, audience to the

Gianni Arcaini

the Not year. longer, but we will in shift later

Operator

[Operator Company. the line the Instructions] Benchmark Legg Our question next of with from comes Michael

Michael Legg

be side elements the incorporated And maybe Could seeing point you the where what a about the level that and then price on about middle? from point guys talk and end the what order from can in entry just the platform the different all you're and little a bit bit talk price little that into high is? it rip

Gianni Arcaini

about system The is basic X.X point price million.

now one our to We very customers of significant are negotiating detection add with capabilities.

the of If targets, XXX. but detection maybe don’t, targets you number you about total remember, detection

If expect and go at you they of what to it's FAA look targets. be to the replace detected and detection the to little be manual detected XXX total to inspection, automatically a

who integrate course centraco. CN engaged platform IBM on very with we fact up in hard IBM, into of will teaming working are developing algorithms, our all has of We on some the these is and this

million. system So, the itself expansion system the X.X or expanded about is

So, long of $X cost of cost total rip million. the cost -- million if and $X.X not term, to ownership, you ownership acquire new the between look version at the the is but

Operator

you. call. question-and-answer Thank the like time, closing Mr. call now you'd this Mr. our for like Thank the conclude Instructions] back this you. Arcaini, [Operator additional to At concludes session. Arcaini I'd if over any comments. to to turn

Gianni Arcaini

we you. mute had on put to Sorry, it not disturb

I said, circumstances. have would under as that wish So better a we I call would

Our our to our able we to period, some to team technology dispatching fact is any complete some Tennessee this to interim project of customer up our even add the and that ready members in sites. comes team of some are way,

more opportunity that can't but time. There's exactly, I give now track one able the us a quantify transportation transit to is

silver So, on revenue. there might lining immediate the sky be for a

have So, Please us free again questions. feel everybody. call any to if you thanks directly,

myself. you you Adrian can much. very know or You Thank call always

Operator

Thank you.

Safe you cautions statement call. I that important call, during this today's would conclude we includes made Statements Before Forward-Looking provide to regarding Harbor like Duos’

Act Reform This of statements contains forward-looking of Private earnings Litigation XXXX. the meaning Securities call the within

may, and forward-looking to opposites looking will, are their anticipate, statements. identify similar or expressions beliefs, intended plans Forward expects, terminology should, as such

not projections to uncertainties, subject are are these performance of beyond are the of number We which Duos which of and to Technologies control, based guarantees many events accuracy the future differ materially the and the statements. other influences forward-looking a and statements Group from are by caution in upon cause those the anticipated influence the or actual our you and risks Inc.'s that statements statements may of which could results

A, incorporated with not factors Duos’ and on Item described in filings to those but other be SEC. and is induce described risks periodically are which Report reference include expressly may One Annual Form uncertainties herein as the by XX-K, These in limited

full joining earnings for Thank quarter Group Duos you and us call. conference for fourth year XXXX today the Technologies

now disconnect. may You

Duos Technologies (DUOT) 30 Mar 202019 Q4 Earnings call transcript