ACTG - Earnings call transcript Q4 2018 | Acacia Research Corporation

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Operator

Good afternoon, and welcome ladies and gentlemen to the Acacia Research 2018 Quarter Four Year-End Earnings Call. [Operator Instructions] I will now turn the conference over to Mr. Rob Fink. Please go ahead, sir.

Rob Fink

Thank you, Operator. are Al today Press. and call the board Tobia members, Clifford Hosting

estimates relating estimates, beginning, remind events expectations the call Securities and during to those statements to would for generally that may of XXXX. Litigation current that forward-looking Before as of differ like forward-looking Private relates the on company’s uncertainties. the objectives may provided are based statements risks you certain forward or current operations future I defined projected results about and forecasts and projections projections the looking information and future contain Reform to result future results trends. of are These plans, expectations, and as in Actual a from this Act materially

please that of Risk with report on For such the as in reports uncertainties, quarterly are XX-Q and and risks on Acacia's see described discussion Form filed Form annual section Factors SEC. a the XX-K

Company the the release like remind under in Al financial call to now non-GAAP financial the present can well News approximately results press would the would & be all Al, disclosing the tab. with of other that said, notes website the was turn This I was addition, acaciaresearch.com Company’s Events is at X:XX call non-GAAP accessed and that Company’s earnings a to Tobia. presentation SEC. refer PM. included financial issued yesterday at from that release, X-K to were measures. the to Company's like yours. over With as as regarding measures, everyone will filed In that yesterday the disclosures the I Please

Al Tobia

end. $XX discussion we three up progress Cash that totaled and our term everyone. On and areas. on IP, million, investments. at QX assets; short we I last Rob, cash, the conference focused call you, made million $XXX have these update from securities and morning, in investments Acacia's will good core Thank year-end our

that During to along fourth in and legacy fourth revenues quarter, Motorola, related from These note the the $XX with recurring $XX.X total and associated a engagements previous these from in of resulted first-half have these the XXXX. transactions been million with revenues our Nokia the I of We could revenues moved not quarter. forever. opportunities had portfolios. quickly, lost of if three be the million balance to in the license we transactions, would during received of closed we received cash expected patent with transactions

administrative costs quarter, business. the we oversees During continued excess in areas reallocated and eliminate notably effort also the to an those wasteful our overhead, to rebuild spending, IP of that team

to Our acquisition moved work in assertion to of secured IP the active quickly eight the team necessary team, explore action opportunities we our we to Subsequent legacy generate with to have currently new and owners. identified nine Simultaneously, engine. These in begun team that close now This the are owners under is new were by We opportunities option. the now professionals. portfolio, partnership initiated took us allowing opportunities patent evaluate assertion. patent several and revenues. the licensing up to with licensing our now IP have licensing restart partnership fourth to quarter, portfolios

necessary us we in book grow our and time. value, is opinion, approach. numerous structures Investors methodical so a with creative over our There opportunities with systematically additional our opportunities disciplined all intend evaluating our critical creation. opportunities for are sustainable patent want book value stress and maintaining moving partner a are success. significant a we of to We transactions. times our are And these doing of to our to in on I is and in on advantage that value measure focus take to at manner. Fundamentally, holders liquidity we and variety believe long-term effectiveness to should,

Regarding our a positions. feel approximately to these are Miso and actively securities level. risk XX% we now continue Veritone more portfolio, appropriate includes manage we in base, They is which Robotics, investments of which investment our capital

improvements statement. Importantly, and go-forward corporate our to in evident begun on Clifford, will significant a like of we governance, our review over our turn strategy. now of upcoming I'd in for results call a become QX implementing discussion have progress the to and our proxy

Clifford Press

press equity financial compared I in And as to and each here objective market for An also better assets, the in $XXX.X yesterday and fourth details. with, overview the provide the asset fluctuations. have of on the But To life on and B. made possible, and of million quarter as details and report when available investments return provide with intellectual in A. share file million of from invest counter made the we visibility morning. fourth property generating we we Good detail form increase and the calls full on we results. Cash the annual quarter short will and An of in an party absolute quarter with our upcoming the were of of quarterly is as release have more the XX-K XXXX. aggregate, acquisitions Revenues of million the overview financial in, overview will will the related settlements million XXXX, that December return a We of $XXX.X over irrespective year. for XX, transparency, SEC. to $XXX.X term totaled $XX.X December issued of positive

nine have currently we of which two the over have litigations, mentioned, course the Al As months. of scheduled next XX trial active

we of any in during the we settlement will transactions to the close expect quarter XXXX. fourth first that quarter. quarter We material receive cash project settlements But do not from first

the the and from balance additional revenues to be these are settlements of revenues in portfolio. While generated do license legacy we our significant expect likely XXXX, opportunities last

Deal licensing new been has IP very pipeline. and is portfolio the refill to patent team Our solid. working flow

reporting, other in opportunities show the and presentation and the we with being our IP Executive, have Burford, connection those our considered. billion we experience In we and in XXXX, third-parties, enforcement gross one of revenue Katharine technology public stage IP all investments. may of patent on be option financial late opportunities familiar, be fees market. believe and direct property our within of experience leads income called to welcomed Maureen Board. legal company under related partners, related provide to We law management statement performing related intellectual section industry. Stock costs the She immensely licensing is listings the usefulness expenses quarter, the the four and She for consulting legal Burford patent firm, was the World's expenses Acacia's who current Strategist immensely than amortization Asset enforcement expenses not $X.X changed global patent London to engagement to that deep business. the clarity contingent direct the through Chief close patent significant valuable external well Corporate increase Subsequent produces many paid to operations Leading fourth leading measure of marker, more will research, of counsel, Maureen valuable reliable expertise capitalization and by $X which more includes to be and paid U.S. as significant Intellectual including all Katharine AIM Burford's XXXX patent from and of creation. to over with the related Deducting top there as significant will flowing is costs as Operations. order portfolio with on have today, the is Exchange's licensing intellectual finance paid market new the domain patent related and recognized Officer to billion This metrics of other in to Financial business. modification to Her Director of activities, legal and the Intellectual portfolio. Property helps of O’Connell incurred a Management expand Acacia's Managing Wolanyk committed as Global the has a Acacia's in revenues, investment the this focused named We royalties a property Portfolio Director, Acacia and Business They at cost for are to bring scale a net business. we a value Acacia. number, is revenues Capital, as on

decade, experience protection with significant Maureen Scholastic as of Corporation, served world's Chief partnering distributor the she Officer rights, basis. publisher and role a a for largest Financial trademark than rights has and and this licensing of the and overseeing more children's owners For on with worldwide books. In copyright assertion

new our strategy, quarter. go-forward now appoint to a team, expect to and the next We unveil something working within we executive refine are diligently

out add the We of highly expect complete independent we to structure the directors, of as qualified build governance and management additional Acacia.

be negotiated. in quarter do remaining a significant the guidance, limited of has expect number remaining XXXX. to of terms the In Acacia licenses of revenues not first of portfolio We

our full IP. portfolio. And call year revenues that the from and budgeted before we existing of expect net in of to approximately XXXX, for a million the We new $XX around current like $XX $XX CapEx IP cash gross investing Operator? operations $X IP all I'd this year. research new process team of believe million open can million the For from now questions. million,

Operator

first our now Montgomery We'll go line. ahead from Scott. from Please Instructions] question [Operator Reiss Brett take Janney

Your line is open.

Brett Reiss

in gap how to the the going gestation Starting cost capital bringing come to and portfolios down since guess to Company from next XXXX, the Good new question, of from here. return show the the the revenues the on period? earn to of for four past period bills the winding are a does in been this new quarters, first kind portfolios couple on the in years. in down pay two over and I had structure legacy revenues be plan

Al Tobia

the is full that will Brett time kind for to you’re produce the that. revenue current take - correct, the new and down intake of winding you’ve referenced portfolio

are when to able get and we’re accomplished opportunity have revenue those a I we be transactions will at describe number how However, deal of intend think with we shorter there some looking to which term of that. we

Brett Reiss

Okay.

Now to leverage in you because XX-XX market. kind to market Do these past looks opportunities buyer’s give the there? us new can a extract terms, with more favorable be color of seems more costs how laying been have out legal had it the a us the split on greater we of engagement some it

Clifford Press

to working mentioned some market susceptible is Yes, of attractive ratios aspects a it's are those we think and one that find we on significant as attractive we’re the that. improvement that and Al

Brett Reiss

sometimes you salute team the transparency for you the I Could it because warrants? stock past from added Veritone's I much how do But better have we than much including tell that. has in management know existing the so me been we

Clifford Press

our outstanding X - XXX shares K, we in It’s warrants. and approximately thousand just million over approximately have XXX,XXX

Brett Reiss

Okay.

Clifford Press

see has sold been in has K on what what you’ll details comes and full retained. the As when it been

Brett Reiss

thank you but in taking going to back queue people my other am questions. to for questions, drop allow I to ask

Operator

our take now Daniel from We'll the Capital. from Please Emys ahead. go Adler next question

is line Your open.

Daniel Adler

you Al Robotics, if about in remarks. could hear please in I stake didn’t the your Miso discuss prepared that anything

Miso what the is stake have what today could current the ownership sort what been maybe of percentage longer it? books the would of you economic Just of and is on value if the term what's in that in a guess, the versus - plans hazard invested sort

Al Tobia

what carried in the the is $X which - into we put Miso company. So million at investment is our

haven’t So adjustments or adjustment the any need that made to we that. to any felt make for

the seated service from monitor dialogue has with Obviously outside large maintain robotics significant position. attracted and independent and healthy capital Miso, venture two We Board at food that capitalists a have continue members market we we to automation them.

Daniel Adler

in plans in might of term And of thinking terms be stake? what longer that terms about Acacia

Al Tobia

if We’ll It's appropriately. monitoring act a position think we come we’re us up opportunities the time and stake with that it do we would exit we for appropriate and as fiduciaries that. to as it's inherited

Operator

take now next Reese Janney we’ll ahead. Montgomery Please Scott. from our And question from go Brett

line open. Your is

Brett Reese

if with the that of into Are the smooth box? patent outside involves any looking been of The the even maybe ways has thinking it revenues. problem you to lumpiness business out

Clifford Press

because the lumpiness issues So of we right. revenue concentration one issue, of have settlements, an the is is of

diversify should have as more money we more and people, CapEx, revenue going we one earmarked for the So we and ideas of get itself. the licensing programs stream is

of were that’s sort taking more through to is - the for just more and that's now the pipeline. going So that programs deals of get approach kind first

Al Tobia

measure on as basis. a business increase think as multiples Brett book the But that the and value earnings And time the steadily revenue us basis or best not encourage we at on of would to would investors look we long be quarterly on. to can I of metric the

Brett Reese

doesn't to it's buildup think respect have can to they nature the the side With a of hand But so that litigation. kind business of cash at the cash that you I there would always hurdle certain in other lot that look on of know the a the a ways cash shareholders with rate? is us that wait to X the point gets above sharing of out where Board if amount have

Clifford Press

position out competitive and is get been size the for that have trading to stood. liquidity Absolutely, business. and and as company that that us. think at pointed stock find We this is where where are been of attractive and inside really investment about now level happened people in up buybacks understood uncertainty the we feel a what a because act cash an we K a we the a things you else found that frankly are more have scenario. on that people correctly where so advantages execute If and stand company, achieved we the it had in one feel I to could now and clear I makes until few the Remember once have were who in picture there where what we until to we now essentially of out levels in at everything this lot waiting much freedom we place up Al have of can

that’s cash the the [we get] more much flexibility. [ph] all with market out So now in

Brett Reese

time, been at about Now Al a track on year, six lose you is have how going months, helm at and the it? I is much now it

Clifford Press

or months. seven about It’s eight

Brett Reese

thought the were things and to me was share positive things you you surprises you In the were didn't helm, is or or so gee! found that going - could you've seven bad things one there two they been than be realize that months one you how two better that at with were?

Clifford Press

that or and of the shareholder think few campaign, the it a after members we know really ran you management vote, highly, management situation. at we no a we elected a as seven, were as and then to was of sole directors business the with of had then team I two is there highly two to was management unusual as the were out We weeks the either. company there has deal and senior Board

the pleased familiar has investing in since quite every of consistently surprise there second increase become to was the property two, pursuing. easily cash the they unknown and very time findable positive about and So quarter we very matters will think at think that what were were could we greatest that surprise there the in in are which are some the lie make it the economics we've assets hadn't such that I ourselves say positive up. been no been an I about cleaned unusual revealed. situation We involved. the of we intellectual opportunities there that essentially daunting in. other I'd concerned we with was some cash, challenges traditional situation And somewhat new of the found significant is business sure and evolving interested company expanding are Acacia done were is which path areas find be we relatively The very were then

the there is that limited most think we that liabilities and were honest I were positive found were to pleased find there things that we to very very no be probably very, So irregularities. and

Al Tobia

short time I all in of period of Officer those an surprise work has just has accomplish getting to Brett, a IP the a able a Marc add able been off has period Chief as in time big terms would to he Booth short been and accomplish upside on the in positive. been of

was the was here lot revenue pretty result from Mark of some in, the that legacy maneuvering fourth portfolio a So, as in the brought of did. that smart a quarter

Clifford Press

the setting business. scrambled literally lot situation where done. Bob as get of and of into some a of entering months comes to $XX.X They're think for revenue year, credit it really it exit a getting business. IP of not gets in to in million contracts seven a I'm are credit there the the I him And that last lot to last done

Brett Reese

in proactive off. sufficiently going telling coverage, trying is the story, Is be that place a the to still quarters good or couple get that story to you're of in more

Clifford Press

yes, the I - will of think announce and be be at governance the I better we things better think coverage we and approach, one moment intend think to we opportunities. proxy, to have expect will get which we deserve coverage, when I we will strategy with which the shareholder the new we the will doing that improvements, explain after presentation the come a to

Brett Reese

is a shooting you're there that? on And ballpark target date for

Clifford Press

once thereafter, I governance manner, the the Board we and and a endorse will will that it and in shortly can share. at able happen Board business timely have we will proper be that improvements get to shareholders, think promote voted disclose a a featured Approximately by we to and plan which will

Operator

Our comes ahead. go from next question Richard Please [indiscernible].

is line Your open.

Unidentified Analyst

a you like XX% Are that, had it to create? have other just there value is question trading trade look book that your might company around any looks or yours me you're to stock below relative conservatively book any like value. to where idea I trying the that comparables at

Al Tobia

forecast. there here been just CapEx. of not in We're certainly, this traded And that go based at/or is burn to into at Well, books, going cycle. going cash space basically on a that talking about sort traded to below the a liquidity stock of we're when or times cash the down below they based looks the when and fact on have patent we've a companies cash looked clearly generating undervalued bit on lot where before of our portfolio

positive IP work CapEx result to should putting prudently returns the in So, we believe.

undervalued stock relatively. think that is so here we And the

operation stated unknowns a we're know be and going standpoint. to going the where from period some have into been there money we're However, losing we

Operator

questions to for the additional time. there Al turn would any remarks. back are conference to appears Tobia, like or It closing this at I no further

Al Tobia

back And be like you will everyone for I'd next thank quarter. attending. closing in just we to to No,

Operator

Ladies nice our this and Thank today. conference a for gentlemen, disconnect. now and day. have All you for concludes may parties participating

Acacia Research (ACTG) 14 Mar 192018 Q4 Earnings call transcript