DUOT - Earnings call transcript Q2 2020 | Duos Technologies Group, Inc.

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Operator

Good afternoon and welcome to Duos Technologies Second Quarter 2020 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 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 the call.

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

Gianni Arcaini

as much. as us. very announcing and you section press website. of thank financial A our operational Thank of of in copy today, Welcome the we joining the XXXX, quarter second Earlier for is release as issued for other results highlights. available you release the everyone well usual a our Relations press Investor

in are the it make of Before operations. I well remarks holding point be our emphasize transition today's that want as today understanding call respect senior brief. company begin, broader a we with to midst to a to our both leadership, that will I pace, With our as

my retirement the position. of effective X. will CEO you September from become today This many about listening announced a aware Duos As I are month ago,

next course extraordinarily talented a believe board have phase over an placed While been ingenuity its this dedication and the the at top and whose our leader, to company decision of a to its has new reins build our the who of right timing of class. distinct disruptive team, lead technologies and bittersweet, guide privilege growth. through hand [Adrian] company's the to I has is will

position leaving in be Our strength. the companies milestone achievement, day-to-day are year of up-listing very of to February to was operations NASDAQ company few I'm And able this of a a in proud significant to the attain.

poised adoption, the growth in well of are and We that Duos technologies chief our capitalized for future. both the core which have as market success

to support for most and success. importantly, and customers, shareholders think I members, a our all contributed that Duos team the make partners, our

and for plan the to everything company as Chairman transition and I to new smooth capacity ensure Board my serve our forward, in be continuing can I doing its CEO. of a on we'll Going

and thermal successor of strong with acumen, business initiated to the process, experience As search have development technical a of part mix right that process leadership we abilities. identify a

by the pause few to the notable recent the delayed were during that received in optimistic remain in more the as results We to are by market new we deals this encouraged contract temporary processing future. in in quarter, going generated updates get the our ongoing we as of April by activity the effectively of The the pipeline, - COVID the announced to substantive that, now has of In many period. [indiscernible]. and June, strength incrementally million XXX,XXX evidenced is portend in the the response working a resume Prior of forward, flow I to results today, global are and I to in will near recorded pandemic, a to begun forward. the encouraged a in been and by being to our awards second of our process difficult for will the the for that quarter. We're the second projection we May believe results the very continues additional is half and months sequential And back with we with And revisited. ongoing face conclusion have respectively, a organization strong million our now expectations After have improved that step providing factored year which a growth looking conditions, we turn wins loaded was modest as forward into and intact. also had environment. start outbreak, $X.X $X.X a in COVID-XX already adapted Deal award current was that its RIP

Goldfarb call any walk - would I in CFO, the now update financial our before this who turn further get the Adrian I therefore, current Adrian? will quarter. into us outlook, results the to for we Now I into will through get this our over

Adrian Goldfarb

Gianni. you, Thank

the discussing to of wish the on best add your you the entire like retirement. behalf would Duos We our an wishes quarter, the service enjoyable for Before all to I organization. results team for

revenues the was or was QX increase or in in of profit was XX% of of to increase months proportion revenue slowdown restrictions due ended increased was being due to a bookings total for for for Total revenue previously in XXX,XXX same Now six contracts, XX.X% the technology and increase $X.XX results in related our $XXX,XXX The lower systems $X.XX XXXX. projects quarter second the equivalent $X.XX $X.XX to the revenues Gross six percentage from in travel in gross the revenue of for increase last was allocated in mainly second business the a compared during in in months to delays XX% million for completion the certain or certain XX, quarter financial to during Gross the XX% our as ended quarter. area to to period, the million of June period turning lower XX% driven The Total quarter. total XXX,XXX decreased described. higher period against same quarter XXXX. equivalent million, first revenue quarter revenue to costs COVID-XX. of in milestones for million the was total the The to in decreased $X.X XXXX XX% decrease revenues, year. the XXX% in from the in year. profit in profit June of revenues. overall due and decrease million from gross months those executing which an revenues the last during by XX, result XX.X% The total six to the or new revenue profit XXXX of

loss the with same our our revenues to Turning ended some Operating attributable The the in per million $X.XX from for expenses to a XX, to in in period to slowdown by $X.XX June Net primarily the million million $X.XX share, per related The QX million period our from period totaled loss loss share, to compared was the X% current XXXX of million, the to to $X.XX impact $X.XX increased actions operating to increase of expenses overall execution. capital delays loss last attributable expenditures costs, last $X.XX loss reductions $X.X in net was same same per due or during six COVID-XX. to XXXX X% was a per in compared a or of a the net the year. quarterly QX effect for The in months ended June loss loss equivalent or operating million anticipated greater quarter XXXX the expenditures the in earlier in the expenses to million expenditures in $X.XX revenues related $X.XX period. XX, increased net $X.XX in $X.XX year. or conducted decrease certain revenues The raise recorded net of as in loss to primarily sales primarily reduce ago. lower the year. We has in in taken driven million company align $X.XX due onetime months loss to to comparable share low year net of XXXX. six share

remained basis However, similar the per share on a period. for loss the

XXX,XXX. anticipated million $X.XX cash cash a in now quarter We execution in million June with Let's the projects, In cash same result operations have cash three also year be we to the compared in which certain net $X.XX the to used equivalents the million of a quarters. months now in ago. and on XXXX of The and the period built $X.XX discuss increase of ended QX, in ended following was in for operations, balance receivables XX, delays we had and in sheet. used of net complete

uncertain previous currently the projections. overall we issued XXXX current in execution are on formally year the as place, update COVID-XX guidance the rescinded our the impact on additional outbreak, this delays the XXXX. Finally, resulting at from guidance in our Due provide well not I'd call, time. like we On to as environment from providing for an economy project to restrictive full our revenue travel financial previously

update the call will reevaluate the predictability provide over our business. on Gianni a back forward, I And to update and further with growth providing give turn and operating call. an of forecast our earnings I Going the performance continue financial expect to during to respect with will Gianni? we now to that, to next

Gianni Arcaini

and Thanks year. the a major for lot, the brief Adrian. achievements before I wins of quarter outlook finishing our with a will now some highlight remainder of the for

$X.X Our most platform the other beginning railroads existing to expand integration centraco very the one existing were into occur The of railroad used recent several integrate will from up initial to summer. plans class artificial an contract sites customers. in locations with win future. million rip total, near at intelligence came X to this our to XXX In a a awarded cases in we June later

phases the The two XXXX execute and new half in remainder will We includes maintenance recurring significant contract also with developed. service a software occurring this the in component in for being XXXX. project early and

excited the recognized to we speaks the are already with it We believe about current customer, of our expansion particularly relationship this because value.

inspection mechanical to not Furthermore, achieving this only efforts. expansion rail another to is adaptable safety We software the are inspection of full particular able believe but the other sector, We their many process. provide and also yet award major railcar industries. to is in this automation milestone to platform

next into our look our step. core expand opportunities we will logical in As continue these to capabilities improve a adjacent markets, as we to

ICAS. mentioned our Office call provide also we Monroe in last on a to Florida Automation Correctional $XXX,XXX for County it System, awarded the I As contract Sheriff's Intelligent were we follow-on May, in call our

a As correctional solutions a also integrated provider leader facilities. command of Duos intelligent intelligent control solutions, is in technology analytical and for

control control The coordinate upon Our and and replace and a legacy logic digital superior is digital with ICAS programmable into date the that integrated to system and is video, control platform input/output a substantially for automation movement control, cost into of ICAS user integrated controlled based single more effective system The was and intuitive specifically aspects control situational detention branded completion command this designed later awareness modular interface. will singular correctional monitoring door systems all new the year provides and controllers. begin are centraco. XXXX. system all in facility jail of expected Implementation all aspects access intercom, facility. integrates is provides completely and to

relationship with We County are the pleased and Monroe longstanding Sheriff our Office. service continued to

facilities master we service and a correctional $X.X that plan. upgrades development in award beginning we we quarter Portal which technology vertical States, an also This turnkey received plan of of extending service were we in by the execute third of Going of million which inform during railroad the to million pursue be contract and expand Rail to installations we of to we April, with platform, XXXX. a Also existing week, $X.X business our to the will and note, a the you the of awarded year. end agreement expected United XXXX. week as latter amount just this this the through support in covering existing I'm in expand Inspection completed is forward, customers half XXXX detection one executed our major our pleased to for

detailed more week. early include in will some the to release minute now the a provide press these We I'll latest future. information updates next on take of awards immediate

right-size second for move of the anticipated will continues our to outpace ensure the our current we current have at for uncertain. outlook to In currently year, of close and projected to a beginning have, in decisive the information the on half ahead viability contract operations based of impacted has business. a our to drawn the to the long-term taken been meantime, timeline the we a quarter, remain degree new measures Looking growth major

resources provide necessary the position current Our continue capital to with our will strategy. growth implementing us

to quarters. to adjustments we additional improved, over demand coming look will anticipated As address conditions make increased our

As than automate greater organizations Duos more looking around for ever. technology, processes the leverage presently in distributed to fashion, world and streamline the are opportunity a to is

your long-term. this While some we have digital of take ready solutions out, over been provide that, Operator, will pushed been questions. advantage applicability accelerated the others are to with And open appropriate instructions. transformation for have accelerated enable call the please and of our that the we're broad to confident timelines us

Operator

question Kumar Ashok Please from Our comes your with today ThinkEquity. first proceed question. Instructions] [Operator of

Ashok Kumar

next you. phase. Gianni, the thank to you the Well wish very and And best look forward

Just Gianni. and some questions broad Adrian

enough I terms initiation Mexico? the wondering have was a of I site completion on The the in acceptance I you you think CSX? reaffirmed about that there rip Are that that had you as could the million far talked this talk think in about you project any the is think will - question you'd visibility million vertical. that I the about comments, completion correctional platform? if of additional acceptance? $X.X the any be of further final And wondering contracts the opportunity add-on was to rip, on that year? turnkey for the you development And is further completed with earlier And in be and platform it's contract, I $X.X then the also for by quarter able first third facilities briefly phase the that of final along And last the the mentioned end that? you And Gianni, when [indiscernible] like truevueXXX. is

I effort. had in think I progress made the extensive, labeling you think AI

And could very you much you again, once If you color? and all provide the just any thank additional wish best.

Gianni Arcaini

Ashok. you, Thank

contract Number or all try the whatever. questions. different award was stated, dissect Let me you a to one, CSX it

name the railroad have press their in are As servicing been an do CN, not but we KCS. sensitive we mentioning cannot CSX, and our particularly absolute customers releases, to customers very which policy, disclose

one With Mexico I'm to respect the those. system pleased Mexico, completed. going to is report So be it's that to of in

working now applications. intelligence of are some the calibrating We on artificial

We midst but the are works well. very of in that the system process,

in fact, expanding Rail ago. of one I'm And in which applications, the to the pleased systems The we production. about so, already truevueXXX the systems Non-Rail question do is both States, two to we deployed, applications. that and to have United as started are close of report and deployed It months recently completion. is we the midst in we in here

ambiguous, in. whatever covered but we As I understanding think, I we see. are I of we mention get rail customers, name obviously, bit their from a requests I awards, those sound our with we want, most we little report get awards, unfortunately, in not it. to that connection hope, know will them I as will we

Ashok Kumar

Gianni you in on that the facility vertical? and got just Yes. Any Thank brief us? any the provide you. visibility color you Correctional ICAS could opportunity

Gianni Arcaini

correctional interesting Yes, expanded vertical, the County Monroe new includes inside on the in surveillance also contract essentially an have we because community. facilities. specifically enforcement video the encompasses work Correctional entire some the law the facilities, done that's past, of and courthouse This the

that in and And So to but serve sometime state prototype as we counties and to once it offer that early and we have should not will solution. facilities completed 'XX, presence XXXX. with that, be a other early, work go other

But it for us will is So of also be it is combination strong a of a commercial prototype, application. a developing a product course, forward. that going

Operator

question your question. next Baquet of with Our Instructions] proceed from [Operator ThinkEquity. Nelson is Please

Nelson Baquet

wanted and And the are gross I to change wanted to it - last seems me that to and reason ask that the margins know what like I compared for XXX-plus year to was? percent

Gianni Arcaini

Adrian, do that? want to you Yes. address

Adrian Goldfarb

Sure, yes, will. Gianni. I Yes,

some not the me I'm your in margin what clarity let gross position. sure to And but there, mentioned comments. I my XXX%, So fringes give maybe this the

effect ASC part calls. latter of is typically anymore, and know, in you to don't the because project. revenue the according the discuss And as revenue it we've has of this ending loading that's the into many So, so the other we mentioned back done XXX that way book We the standard. more

the because almost in the you minimal kind revenue book then might stage. company but as to has faster a to the But latter from or you early execution a the become late projects revenue quarter, and as that in been impact margin, as the cost get in that of have book if the you impact have start it now, of is time very will same the self-results great Now is two sale does That more that year might the a you deploying because stage project. as isn't some ago. of that project efficient our

period, following period, much reporting percentage. as So then a what you revenue is higher go into happens the the is

I've will on on between our now. about be the The the margin is normally get can on up the kind probably these slowed and And one you this in, we So right analyze outsized may probably six-month that way, normally look before of effects financials whereby would current - quarters. spoken basis. other smaller Everything of a we're outside about is way to best gross will one. look pandemics

are on outsized we annual to But get you at get is typically if to So, XX% close gross going aggregate. And the what mentioned you our on contracts, to some of of results, margin service other look couple on thing Gianni more as or is side. are happens a the those recurring is the that effect. side some and a both and more there licensing that and maintenance revenue the

margins on of a all about margin will be effect So where aims businesses moving the general our as hit gross general to But gross you aggregate. across our will XX% a a rule, generally Company higher. see

And too period-to-period in variances. so, you the attention not pay should probably much

hope So I that answers your Nelson, question.

Nelson Baquet

does. an increase of said XXX, And XXX%. it but I No, it is

Adrian Goldfarb

Correct, correct.

Okay.

Nelson Baquet

Yes, appreciate lot Okay. that And thanks. it, I sense. Wonderful. makes a of

Operator

our time, concludes closing question-and-answer to remarks. session. turn this call to like the this I'd Mr. At now for over back Arcaini

Gianni Arcaini

Thanks, it on the years. is who operator, employees, to years look I saying, ahead. this for for the joining future organization please. and lead The And thank stage thank success company and next today's over over call. has to of our in to you customers honor Operator, I to supported like the the been especially well company close forward shareholders, I'd Duos's years. have growth. us partners, by want an its all positioned

Operator

forward-looking statements includes Private today's call, I Act would contains earnings Duos' like conclude call. this Reform during Litigation Before important Safe statements provide Securities cautions Harbor meaning This XXXX. we the within of to regarding forward-looking statement made that call of

Duos are not should, number opposites accuracy or many the may, you and influence of which based and forward-looking incorporated in in anticipated Inc's upon joining We for cause Item guarantees Group's beyond XA from be and plans, SEC. expressions as events their quarter These statements. the you performance Technologies And identify other conference today not Duos and which factors with filings by uncertainties to of which described of uncertainties, risks and XX-K is influences, intended in differ Group by that future described statements those projections XXXX limited second expressly for to of believes, Duos but are Report actual include, as the materially may those statements results are earnings Duos Technology will, such Thank a other Form anticipates, subject the the terminology forward-looking risks statements are to periodically or our are us the could and control, may herein similar statements. are Forward-looking which caution call. Annual on these to reference. expects,

You may now disconnect.

Duos Technologies (DUOT) 13 Aug 202020 Q2 Earnings call transcript