ASUR - Earnings call transcript Q3 2021

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Operator

Good afternoon. And welcome to Asure’s Third Quarter 2021 Earnings Conference Call.

Joining us for today’s call are Asure’s Chairman and CEO, Pat Goepel; Asure’s Chief Financial Officer, John Pence; and Head of Investor Relations Randal Rudniski.

Following their prepared remarks, we’ll have question-and-answer session from analyst and investors. I would now like to turn the call over to Randal Rudniski for introductory remarks. ahead. go Please

Randal Rudniski

Good us operator. And you thank Thank Asure’s afternoon, third joining for call. quarter for you, everyone. XXXX earnings

close Relations the website investor released we investor.asuresoftware.com, where release the of also results. at website the find can SEC’s Investor earnings on is our our and presentation. you The available Following financial markets,

use items. refer future timing our believe today, earnings such, results statements we will expect, exclude which these additional and be to to believe investors differ with with statements. forward-looking and call could may of that will from contain and measures, factors indicate current a for and SEC GAAP in actual also filings we call information review During to our such non-GAAP their useful impact on can the A expectations. items to along certain words that measures our our of encourage we forward-looking found the Today’s be you of most as risks. reference events, We non-GAAP And description as measures to involve reconciliation release. financial materially some comparable to cause

Pat remind now and like this on to turn available would everyone Chairman like is call being relations CEO. call Goepel, section to recorded, and investor the would I replay via Finally, With website. it I that, to made be Pat? available will that for link of over our the

Pat Goepel

call the CFO, year for strategy, detailed then XXXX. of fiscal begin results, Thank business and on presentation turn our update you, and of for more quarter fourth the with our outlook Software’s third earnings call. Randal, welcome XXXX today’s a over I John will Asure and and review everyone our quarter to performance financial Pence to will an

We time questions. conclude session the to will with your answer then

X% rate. markets, as some in say million, relative is labor versus evidenced which there though, in across prior year areas quarter reaching unemployment lingering was the small shortage up in to that with many We with in the remains and of country. to really trends the to our Macroeconomic performance third the owing I continue revenues XX% would up the is are improve affecting pleased businesses decline prior our quarter. almost $XX softness

divested However, in acquisitions. important We the overall, in grown the we resources also improvements right equally, to in in solutions to revenues, our And XX% is revenues Then, by our The Directors business that successfully really business, could order we economic enhance so order edge have our continuing want sales, who in and targeted of step year providing for can are terms forward this in strong businesses versus quarter resources, organization’s goal in core and strengthen the in make XXXX their strong out, the to strategy for and key we they to where our have of roughly the and skills, to valued is human talent so products XXXX executing in focus organic pleased run that the third team achieving right business. management business. build into their prior strategy. them leading we space can portfolio heading deliver capital to repositioned acquisitions, to and the you be positive execution making an biggest we while of I and the investments recall, customers environment revenue execute a small this partner, focus of and X% to need And the was people, the our opportunity. leadership the we Board organic we’re XXXX, I driven and so can solutions management successful Asure, across momentum, margins by the right in is impact. big against if on growth believe on enable XXXX, execution. XXXX, benefits business. this point growth our with driven long-term

quarter So, acquired in our one last in acquisitions, day product the the are terms larger other of Vermont. the this of the sized expand operating services start and companies in territories. small period. medium third cross-sell target of will the strategy, related highly three around in let’s providing which we acquired we and acquisitions. two based businesses acquisitions our In and These upsell -- and Jersey and believe focus and New on enhancements; within not their our synergistic direct pillars they’ll business. results and providing the based our core Both of to expansion; sales were The opportunities, payroll be with territories, quarter, discussion impact to resellers resellers, did on third our

we We’re into conversion be the business stakeholders to our and our platform. time. we expect are excited solutions. them bring system companies highly currently as to limited accordingly, their over Both integrate Asure’s and And companies really into requirements to accretive Asure family, our utilize these payroll operations

an this result capital while solution growth strategy expand other a management our of to our continue well important our will part to acquisitions offerings. human in that white also smooth as as should that and territories, scope businesses opportunistic we as capabilities experienced solutions. Acquisitions integration scale operating staff. new rolling will and our of build expect up payroll pick We up be remain we consider complement We’ll reseller in label partners that our and

Turning now product. to

a payroll customer order onboarding tracking employers across have business in capital introduced simplifies HR features seamless combined for with option, potential for into solutions quarter, experience new third solution excited combines with provide of market small best the we tools we now single our payroll platform we our solution our advanced communications Also self-service system is management significant a with offering. new This networks. We’re and and integrated standard human our in our of experience, partnership the enhancement payroll in Navigator, provides that employer with new about tools. and Employee launched new their part the the the both to

much addition providing to with as referral want In forward should more also ambitions spend as the lay time us talking well the partnership space. groundwork our integrated I some move data our broker HR platform, to to this to in health. solution, enable for tax about a

driver unique differentiation capabilities, in integration, potential client among significantly the our it open the ability attractive at reoccurring end management to with total human segments potential tax development and our business well for be start recent feel This is addressable in client the acquired with to a to marketplace. the larger product healthcare only opportunities not the some you we This in an solution tax our reason to to capital industry has this which as We’ll future, about the client that active for payroll We’ve enterprise, who tax our about. We’ve offers market filing, up. in is in and client wholesale we’re and we addition interest characteristics. has we had with revenues the the Let’s another service particularly the the platform. up it’s us an is asset This new and provides us. us, markets important as expand health outstanding updated new the HR with significant XXXX, the position this to business initiative as base. model, in the as solution tax it for of revenue interest excited grow services. marketplace. a keep optimistic retention growing on open for had have movement this solution up filing new revenues opens very see full for strong This client money we’re continues has

you clients them, doctor offices, the offices, cetera, think back target also practices and of to focus rather so their run focusing audience that running healthcare our if deliver So, they for It can improvements their on that small et than office enables improvements. businesses. is on fulfills objective, We the here. dental

activity. now Turning to sales

have training which in and with improvements and role small that while year-over-year investments efforts At activity XX then now marketing and for proud sales from milestone. is a basis, continue at a from how team that we months XX our closer channels, of end when the year-end bookings about in At end quarter, we after those divestiture. while business sales year-to-date doubled. of we XX% sales to Since our of salespeople. bookings the XX our getting be team XXXX, an the from in the continue tenure significantly of took in are our on Asure months. end We people at sales the recruitment off these in have to the XX up and space of our quarter we’re direct through XX with we sales average paying business continue and small very up to professionals. is our third drives reps, to up It’s sales important important approximately started in Getting focus lead last expect sales turn XXXX total our I These XX revenues, embraced to the tenure segment. productivity invest challenges the direct in quarter, the leadership up of XX average pandemic. generation at see second an on that achievement, we staff had to quarter. strong months point, third The

third solution in we this dollar their platform over For as Credit, deliver how respond maximize helped complex the Employee solutions solutions couldn’t ERTC of example, unique COVID small to have of our support clients. and our clients and proud help Retention our dollars program. people It they and the more stimulus clients to customers our I situations, $XXX tax as than part our team, can credits introduced an to stimulus XX,XXX businesses. new quarter. business end navigating in impactful be them and of our hire These staff efforts and at grow total Tax the help critical can also million efficiently regulations, file shows to

than business to small Asure unprecedented As an helping essential changes business navigate grow and challenging XX,XXX in clients remains environment. a small compliance committed very more

two strategy, ethical as support partners, of in the product values to continues performance, well In quarter our we United past in third significant the a based significant challenges our that of throughout in as another quarter deliver larger for sales reseller businesses our practices, and and social acquired business experience leadership small States. we’re to invest to committed move teams, summary, our new the innovation, economy with made we We’re culture, solid growth continue as pleased strides pandemic. responsibility

that so model We creation can about we levels works the platform. longer We Asure’s with acquisition of our businesses driving opportunity effective and cash revenues as excited acquired significant future model. We’re enhance EBITDA in higher believe margins the our term, value see drive our combine flow. and to be

Now, detail. to results like discuss financial more to Pence off hand John? John I would to our in

John Pence

Thanks Pat.

call, mentioned at figures are Randal of non-GAAP. the beginning of this several discussed the today As financial

release of asuresoftware.com. And today. You earlier available Investor will investor description section to find recent reconciliations themselves our posted included in our Relations non-GAAP of that in a our in most was made reconciliations presentation also the at the GAAP earnings are website

results. the to on Now,

XXth, generate quarter revenues year funds million doubled Third which versus quarter. in fund prior and versus the grew $XXX.X balance prior million in year the ERTC year to up sheet of on the were more of XXXX. flat million revenues versus prior was our Recurring approximately to quarter the $XXX,XXX by represented on $XXX.X by versus from prior strength at offering, end quarter of on compared rose second revenue of prior and revenues Client interest. $XXX.X service client our quarter, Recurring X% total continued client assets our $XX than September QX the our end $XXX,XXX. and XX% revenue XX% non-recurring by third significant at million. to the at and X% quarter, Interest the approximately

are pleased with We our gross performance. margin

cash prior benefit for and EBITDA EBITDA salary increase This headwinds quarter. prior Our consecutive result expense a reductions year is expenditures. than million X%. basis The approximately quarter, QX quarter, XX% performance the and despite following implementation to to the This in points the the QX COVID. up cost of year’s benefit and is in quarter up our margin fourth containment third than as EBITDA gross XX% $X.X return an a for increases. which XX% was XX from percentage. versus percentage we higher higher growth grown margin of and non-GAAP gross absorbed in despite we quarter which reached in margin and marks our last was efforts XX% XX% have higher third pay of as has to and increases non-GAAP Non-GAAP Compensation pay represents related third owing from temporary revenue occurred

also the an So, these periods. we in adjustments comparisons as EBITDA number a a affected invest by to sales in have organization future of revenues meaningful sales are impact. representatives increase drive in higher

there’s people to these efforts momentum and some results headwinds, related are and key that scalability are to we strategy of underpin that to and headwinds sales are platform the strategy, improve business. expenses future increasingly economic sales While operating and in our in our the force third cost drivers our the and margins strategy. product accelerating efficiency. our our investments our we to improve our pay leveraging by These view the manage order to quarter organization restorations, in deliver building our these will In expansion acquisition

in in Turning was million the we benefits on by to paid price business accelerate will it million in our $XX.X million, aggregate The balance sheet. date. an capacity operating payable, quarter over in leverage scale $X.X purchase assets we yielding shares. acquired the are resellers in important, goodwill operating the as the XXX,XXX of grow of intangible These $XX.X in margins and acquisitions increase for the and expect two time, which issuance acquisitions. to resulted an our acquisitions of to have the have built notes and cash, We

balance we with on which up the balance annual quarter our and a We facility that of $XX the of revenues. notes had make balance criteria sheet, facility and cash acquisitions drawdown we’ll loan initial Continuing from the million is to new as a standards. sheet to our have continue an debt, entered comprised This advanced evaluate a we on quarter critical equivalents Capital. milestone pro $XX.X from and ended the with with acquisitions. seller million term cash opportunities capability and We of forma million $XX.X fit Capital, an with further based made third is of million Structural based Structural into in achieved rate, recurring $XX

our is Aside from combined possess growth. covenant and believe be We us And activities. Goldman are a options our term. partnership we from excited previously Fargo, stated the ratio, possible with of new closure up credit goals. Sachs complete We’ve our the quarter. recurring to on also limited registration because in metrics, the credit flexibility meet our has made these new our revenue acquisition about. we compliance uncouple financial a we and This the the enabled pursue for has able facility with which relied pay such has plans opportunities of with Sachs, four-year In facility achieve opened movement, venture third to pursue us to move two with will that real we really when into to inorganic financial Wells to this We’ve management money strategy the criteria, that of areas, financial us filed facility resellers facility of purchase with our will and our facility This in the previously opportunities. leading to new new the the Goldman to brands structuring as clients state-of-the-art organic combination statements, money regarding openly and with business world. time offer communicated new help with strategic partners one our commenced business our

relating expertise investment $XX.X from Employee Retention we to returns benefit also Tax of also the excess client Credit. We a funds. our gain invest expect as booked the we their quarter, to in In enhancing million

them in returns first in assets. the and to item income and as discrete treated as receivable reconciliations. amended XXXX. these non-GAAP statements nine in a of Recognized our booked current other was This recorded line of activity our an relates for We credits the months filed adjustment gain interest and have for and is other

quarterly fourth is qualify of expect part the current the to this modified. we quarter debate in if law continuation for not While the is similar Washington, the credit in of credit

of Now, of for is and to our the flows turn future and environment the economic challenging guidance fourth employment other challenges results given continuing XX, backdrop acquisitions. of offered ending of and impact considers today economic guidance the December ebbs This with trends, COVID I’m recent the to going quarter predict to XXXX. the

is following million quarter for providing of guidance. to the non-GAAP million. $X.XX negative of to And to and $X.X XXXX be range $X.XX. $XX We be are between $X.X to the of Revenue negative expected in fourth guided million. EBITDA range in EPS the Non-GAAP the guided is $XX.X million between is between

be $XX in are is we year, introducing to in $XX Revenue the XXXX following of million. to also the fiscal XXXX expected For range million guidance.

anticipate with also non-GAAP XXXX from and percentages line EPS income preparation to Consistent percentages benefit EBITDA to XXXX space trends, the non-GAAP federal reporting performance, the year the with divestiture. will fiscal quarter we employee reporting generated ACA WX margin historical regarding revenue employer annual subsequent in our expect compliance. historical and and of We of by seasonal be first results

market are to to as in foundation new With a this we HR is demand our Our pursuing levers and stabilized customers, reasonably and this offerings and accretive pursuing amplifying environment acquisitions, employees. strategy payroll customer that expanding by control, experience, their and and focus serve offerings million indirect backdrop, product functionality innovating improving and we over better into trustworthy on efforts solutions. by to tap can sales our our X core beneficial exciting and XX,XXX over for service cost solution direct

some back the that, Pat to final over I’ll remarks. call for So, with turn

Pat Goepel

Thanks we quarter pleased performance. our summary, are third with John. In

XX% and grew our our by and growth prior by marketplace and to in in organic annual relative XX% EBITDA to revenues continue prior We to headwinds relative non-GAAP sequential salary growth quarter, year, in despite evidenced We XX% from restoring X% have benefits. momentum good revenue. the as rate

referral commitment the more combines marketplace. in their clients solution proud for payroll $XXX next have ERTC for great us will that their the million clients sync, time. have single traction forward very us generation the of our in solutions stakeholders Our we’ve data ERTC accretive Navigator providing helps of turn solution. needs. penetrate exceeds our of of with the continues I’m than HR that for both, and business and to excited launched We acquisitions a payroll broker keeps And We business highly to meets Operator? capital, small the integration about, our that a which our into will that luck. With over to Asure over clients and We market. And in we new I’ll we’re be the expect in completed and question-and-answer payroll filed HR two diversified that, and drive team, and sources value growth user for controls to user the improved enable Employee total, our interface in to implemented that organic inorganic employee a better and call fresh execution solution, new operator adds and revenues. to the our With solutions session. enhanced the the credits.

Operator

Instructions] Joshua you. Needham. Reilly Our line Thank the [Operator of from comes question first from

Joshua Reilly

we organic revenue. with rate how number? off that $XX ‘XX What million growth guidance to the of the $XX should million in starting Maybe in assumed think about --

John Pence

I we’re hoping from think our changed, anything’s I guidance. mean, Yes. historic XX%. don’t for I Josh, mean,

on -- much number this too I now. don’t right it really, think XXXX anchor

at the where We’re acquisitions. third historically for the with XXXX of give sense was these a Street impact you trying to quarter of

pencil kind you more XXXX. think to sharpen for sense I to and through least at not impact want where been out. did would So, give as to XXXX. might the far process, we’ve of as guidance we we acquisitions as I’ve budgeting But, our some come, go we we And the given what had for at since that have here, historically, relative been of to be

the what to So, you thought some it kind senses as an attempt give acquisitions. about was just of we to

Joshua Reilly

somewhat being? to much margin gross there? about that’s sustainable there should the how those going create the that And helpful. change does a headwind was product? due the if think some ERTC then, And into how next of revenues then, quarter No, is benefit year, Yes. we And in

John Pence

on opportunities. So, people we incremental Yes, definitely margin, revenue to helped right? that add the gross service lot didn’t of a

let So, that I’ll impactful. the comment. headwind of kind of Pat was kind address

Pat Goepel

Yes.

we I scale, think, set we’ve my lot in of perspective, Josh, a and the done improving from business.

think kind in to quarter product initiatives go impactful several So, XXXX, that gross the introductions, refining including about the new too, even initiatives, margin, we background. of to of that some including we talked some how of we robots will be the have AWS, with in we business, centralization some last the of and

be So, there’ll initiatives to in. we think that several layer

that And was improve year. As it positives we’re there’ll any ERTC, or felt far as great to this some on quarter, we plenty pluses think a help opportunistic, program. we be that of next mitigate

Joshua Reilly

can great. And more there. sneak that I of maybe one questioning line on Okay, in then,

on hired to ‘XX. new acquisitions You restarting, made going the have of that’s of point margin specific the CTO either quicker integration the done process a COVID be make now of the anything as Curious, there to integration you kind pre-COVID can go accretive? Thanks. you at versus and/or is side is beginning more that the you M&A machine this on guys

Pat Goepel

couple I think, a things.

the expertise. after Yasmine going really Todd new did who And the Rodriguez, question wonderful payroll then, of think over background the most And who’s initiatives we’re part improvement from who he’s time, the will we initiatives capital to management several that first operational tax. help all, former pointing a great specifically, and charge we grow business, your acquisition in margins integration. at president, of has really, help CompuPay and with gross for forward. CTO really Board came a of of And Directors hired was So, think Waletzki a they human space some the job. I

of or XXXX, AWS or almost the platform the first within XXXX now, by First will the second of all, same on be all same of environment. instance quarter quarter

we by a robotic talked as more of we the a production work just really initiatives was think the robots, So, more Three, that’s cycle employment of taking the where effort. add Two, for about we That kind non-value really standardization and a we kind around out real led lot headcount positive the of stable, have. the I but can do relatively us. introducing keep that development with integrate in us product new interface. going will set, and are kind finally, to be successful help kind that user we forward, forward. the integration in more then, going on And just introduced That do stuff the environment. web, Yasmine help that will well. the do where within of a of will us customer All will able

not series any but playing one that it’s next the we’ve years? So, person of over a for of been initiatives couple

Operator

Our the Baldry Richard next question from comes of from line ROTH Capital.

Richard Baldry

Thanks.

drag of historically, guiding to thinking backdrop, actually optimization EBITDA that of integration pretty feel up adjusted you’re before level. a be EBITDA tends Sort for bit grow adjusted I solidly new brings on sort QX. from to QX to a But like M&A of a against

acquired before So, higher? integration you gives perhaps your start could you back, long the to being think those the maybe that the talk how eye take you you then, aren’t should Do now going fully completed first, an go across and to pull can And be with about what at acquisitions integrating backend Thanks. confidence it you that in AWS future? entities faster platform?

John Pence

think we I Yes, can.

integrations. mentioned would the To answer for we’re of and modeled be all your by XXXX, sure, with have not these deplete quarter. to done expecting drag, platform. we in into to analogy, synergies the companies that kind integration trying end of fourth think, these We in the XXXX it’s hope Clearly, same think just are be question clear, to I’m difference just Historically, path. I Pat the the a configuration. to software about using the I And but good give about our

funds about of [ph] around. but same So, and Excel, it’s software, the maybe think moving use

use resellers just wild. software So, little the bit a our these each in one of differently might

we’re software. is acquisitions, all amongst into the our come acquisitions, well so, And as doing Internally, same of they the what bring our we’re case when new use of kind case previous standardizing across of software. we use as our

lot the integration quicker quicker to standardization So, lot then hope we we’re and do quicker, to higher, able driving a get a as the margins well.

Pat Goepel

did would just quarter you I in to add, in first a And We acquisition the I’d point Northeast the smaller January. acquisition.

and where And our acquisition. business period is If that acquisition down over we’ve was people, but without sales of meaning that we’re run this kind headcount that we’ve here, you look headcount the nine year, and where headcount kind months the at added from of we time. overall from absorbed some

I a time two with similar lead a think of result will to acquisitions. kind these good over result on here

Richard Baldry

Last sales thing, could about talk and the the to throwing were about degree this much really companies you integration, you’re on about you or the the you’re more thinking so themselves Thanks. earnings resellers, really not bringing those? which capacity is more the acquired, productive from

Pat Goepel

Yes.

think well run were in were operators I both that very the business.

being also partner they the lead a to so decade anticipate both seamless expertise were of but And while a as And in for COVID, growing. with So, they or will that their cetera, et will backdrop we growing, coupled were believe business now we that there a integration. grow forward. going

John Pence

is I getting point. we’re been Yes. just to think year challenging, has us. This clear kind on we’ve pretty last this important scale breakeven to that of been at standpoint, that And And point. the from

transparent we that’s did scale Structural, invest scale And and the invest, the that’s point put affords so I and and key been deal more a it’s which we we in, is file, we to on I quickly, flexibility think, we at statements with lot pretty us get what it the why think for important. on speed that us. why do we’ve and want this registration

to that later. we business. to but scale going than sooner are the rather for to want We’re do We imprudent, things do not important get think it’s

Operator

Bryan Cowen. the from Bergin from Our of next line question comes

Bryan Bergin

A client you here. question so two-parter for around level, employment

on sits prior quarters? to couple comment it, where that? for level, COVID didn’t how recovery anticipating in employment XQ? hear just you’re control then, you the of pays I over pre-pandemic can you today So, relative -- Sorry client disclose really the next to and metric much average And if but size did

Pat Goepel

though United Just States think a the level. macro lost let’s they’re talk $XX as Early jobs normalized and we COVID that. mindset, of the as early, some million a et Even in about improvement employment, of level X cetera, see million. million, And, probably the the from deck XX we’re modeling, client so claims, IR around the or jobless economy I we’ve at far America, done out in you workforce.

this were a probably as As XX, XX per we control, far as XX. I far over area control, at believe, probably in as pre-pandemic, pays or pays per little the quarter

though, I just to, somebody’s And business to hire some come business small order the disproportionately affected. who’re in has little owner that’s a one, up. say affected, mainstream people, probably And bit some to would know, it you to any and America hire got takes quarter, want looking a to I were that would and But of general this then you tick two say slight of people, noise. magnitude. speaking And job. in was into got almost

quite have but if you know we’re So, improving, we’re not anything to don’t yet. there add. John, I

John Pence

The pre- I added do the going it, deck all disproportionately but the at though that normalcy, the we point There was think overall that it you’ll I that still base to and to post-pandemic. gap a in still of employment analysts to this in the see the about point, million our end, there’s shows metrics. to make levels news X a return still IR even right talking to gap rates employment return and is needed on client kind unemployment impacted starting slide and

to some still upside normal. think we’re and back I So, gets -- have

Bryan Bergin

about all think I economics on That’s as acquisitions, they helpful. you targets that we curious in pipeline talking And guess, XQ that. And line here You’ve Curious acquisition you’ve the I’m mid are about couple was expecting larger two with market than this are line size for in yours? in past? talked is a with here if So, right. in the revenue been quarters. client too, the Okay, what these contribution? about on then

John Pence

think I base. customer consistent pretty

multiples In terms been it’s we million. want about this We can it $XX on two in the to guidance we to you, deals X of in presentation. reflected The to be These talked smaller kind of of times, be we’ve bigger terms consistent pretty higher our range. size. scenarios X revenue paid, the in contribution, X Goldilock closer in to be end that the in obviously we think IR that to gave think time times. we’ve I were and and $XX.X will deals X closer million

So, at. you’ve where got from to we’re infer that

Operator

the Jeff Craig-Hallum. comes Van from line from Our of next Rhee question

Jeff Van Rhee

Pat, correctly I sure just think hear front. acquisition and make I commented briefly, it I to want you the on

open typical little You that said you thought are were on a were variation more a I open acquisitions bit saying things. to maybe resellers And models. the of non-evolution and you

So, to just clarification on that start?

Pat Goepel

Yes.

we I some have think all, growth. have obviously, a network And is that think, opportunities we of we powerful. pretty continue reseller to First

you them that. assets PTM, start talk we money We’re family start we of one some We base, feel other have to interesting there’s our opportunities could relates cross-sell opportunities, standalone there scale, to et it to interesting be our And And some -- if interesting. good the as of get we think cetera. get movement. we that think then, to about then, pretty where ability within to also about to acquisition an talked And that have as to though we be some customer filing, now scale. our could we some that was have tax

I could be think some would present page immediate. highlight opportunities. I some some don’t as But, I wouldn’t that have it could money ability it, an access introducing -- anything be shows the to to their that can -- opportunities. ‘XX, that to turn to we opportunity We just itself. our we’re there we think, of think there may cross-sell. get customers other ability the ERTC, I be

Jeff Van Rhee

And a the should think integrated does in terms that HR the also impact, how impact we ARPU of provide all of put can around then, adoption, this uplift? just offering, offering? the expectations, powerful at that on new What is about wrapper integrated you payroll

John Pence

I think, customer based sat, to that first think use of things on necessarily leads there’s are all, right? really some but I customer of So, the higher mentioned ARPU don’t use and ease ease that of retention rates. sat, hopefully, or of uplift, just Pat

into something far, Pat for think touched been just think for ERTC I we about I penetration, that’s healthy primarily customer months. XX% roughly of a pretty five, point important. six good very -- sell base. kind think which And had was pretty only so is on out our is I that cross of there terms sold a existing In This

get products ready tons we’ve I the as and value we demonstrated And customers better, got that. delivered cross got that proof to of attacked a So, really, point them. sell really of to that that our some other to do it’s we’ve think to the ability

making And lines in so, got house force for spend again really want I And time I them the a point So, think and XXXX that’s kind sales primarily of take some that some honing acquisitions lot just we’ve what they’re product to is the product Pat’s alluding to to today. too, of think easier installed our across one are interesting right? the buying base. for

not focus really got always new that well. as we’re ARPU increase but is to across base sure and trying delivering logos, important, So, which customer that on we’ve value that adding really make just obviously to our

Pat Goepel

talk specific increasingly then, budget, we’ll metrics. of would Yes. opportunities process, a I about getting because through budget little some here. or line, more we’ll we’re then, really talk And we’re through some up I I as The bit only really about forward. product is in wrap about think the point excited the And we add that look think, just frankly, March, more the we’ll the

March. in that see you’ll So,

Jeff Van Rhee

or if Yes. Maybe a on margin set one in in FYXX that Can divestures. of John, the EPS and maybe expand there. trends line second? specific in trends it that prior just you for sneak trends relations EBITDA Which on lot last, to could is a for guidance call historical non-GAAP I out you you’re there? There with

John Pence

a a pop then pretty to quarter, seasonal lot which the component the Specifically absolute kind So, of right? percentage, kind of and In line, obvious, we our of the there’s trends, percentages the bottom EBITDA just the is really, because first of it -- down. really right? numbers

I trend get quarter. to the was across what So, bigger what That’s in be that ties that into trying has So, going that, I always And kind first to of EPS statement. then, think right? just it’s and just much same right that’s in to I across. get was trying

Operator

Street. line will Our of next the from from come Martinuzzi call Eric Lake

Eric Martinuzzi

My was the guidance. Yes. regarding QX question

XX margin of the between margin what three for and kind Given acquisitions, quarters back XX? two guys or the so, should gross going operating past you Just think there are with been about we on? acquisitions for layered gross have QX the assumption,

John Pence

be a to a think, we some little that to little look of hopefully would way on this nothing bit I But really nothing think, but dramatic, Pat have things bit that of over up continue would up flat I I expect trend quarter, to improvement at mentioned. I the us the would think I based it.

Eric Martinuzzi

year, beginning Okay. net an laid And backwards, coming year-end. you the out goal. another and mean, the goal, had you year aggressive you’ve I reps, XX you aggressive X into an mentioned things between now, of and -- looking adding

in those of weeks they left kind folks identified, are kind interviewing year, are these We pipeline, are in or the yet to the reps? the direct already of seven be incremental in

John Pence

identified say. Yes. year in We the finish No, XX. to or the process they’re let’s hope around

year that we the there I have will clearly, of how turning we much XX line reps. think and see a I at that. be we of to then But lot we on sight us good from think a guidance. have decide sight really March’s could up going of

Eric Martinuzzi

companies? the organic, from right. then, All about we’re talking inherited reps acquired in the And

John Pence

XX be It’ll be both. would the think combined. Yes, I

Operator

question the Research. from Colicchio Our Vincent next will Barrington come line of from

Vincent Colicchio

wage how there also And of accept the in is terms side? your see the -- impacting that how higher you any Curious prices in business in inflation cost to on market? do willingness the near-term pricing,

John Pence

We on haven’t had Vince. pricing, of resistance a lot

some across we’re to to but going headwind be manage but of the job, suffering side, is, XXXX employees. it’s with jobs some board. same think business, service starting the right? an that customer kind but those We of rest lower we’re we’re where think generally inflation the of are issues for entry at like yes, definitely it’s we’re still process, the just inordinate get the level be the of we’re on we’re able budgeting trying really and through people The the pay the ends that an to more to that us, level So, efficiencies be of it lower are on the are rates, seeing don’t market I the entry going seeing. in in

Pat Goepel

as I of think, more ultimately, Vince, from revenue. inflation with have lead an we capture those would market. the And add But, that’ll to dollars. sometimes growing we’ll the thing I flow, do to could wage capture only I kind is, opportunity that float our customers, then, think be

a be could And area so, positive. see one that’s where we which it, would

Vincent Colicchio

people at worth reseller comment be, of are of know quite if their terms folks in bit in can think acquisitions. pressures looking -- the on may on on there’s ends, more I assets a one they Pat, pricing both hand. some you you’re then, And terms things than

get capital tax other at economical seeing is the value? you coming. more you On Are the deals hand potential gains, changes can that done

Pat Goepel

you quite make have COVID. deals but like same think I those token, prevailing. opportunity think we’re I No, always market, certainty. you bit of here And not a to have is is little the value half it’s there’s sense judgments I the certainty, And from the believe, we out the more all people done to common nation start say, can first together yet, stabilize when a testing there discussion. the marketplaces but of of in healthy And first And coming do the the easier. would year. some feel I there’s some I get and

and do opportunity to within to the and take an that Asure. advantage the right we to scale stage for going we We’re that. right up, to think get and deal deal grow want this But of there’s

Vincent Colicchio

quarter. nice Again, you. job in the Thank

Pat Goepel

there appreciate Operator, I other you. any Thank it. is questions?

Operator

sir. not questions, further I’m any showing

Pat Goepel

we understood everybody’s this detail, think good some went thank you. appreciate the on sure business. pretty We call. really I you momentum. We into wanted make to have attention some Well,

March. For forward team to look those we’re us, execution pretty into in think of the pleased followed we of and exciting have I’m you update XXXX. that headed with the our very

Have you. great a thank day. So,

Operator

conference today’s for participating. Thank call. concludes This you

You may now disconnect. Everyone have day. a good

Asure Software (ASUR) 9 Nov 212021 Q3 Earnings call transcript