TransAct Technologies Incorporated (NASDAQ:TACT) Q3 2020 Earnings Conference Call November 5, 2020 4:30 PM ET Company Participants Marc Griffin – Investor Relations Bart Shuldman – Chairman and Chief Executive Officer Steve DeMartino – President and Chief Financial Officer Conference Call Participants Jeff Martin – Roth Capital Partners Chris Howe – Barrington Research Mitchell Sacks – Grand Slam Asset Management Operator Good day and welcome to the TransAct Technologies Third Quarter 2020 Conference Call. ...

Financial Data and Key Metrics Changes - Total net revenue for Q2 2020 declined 53% year-over-year to $5.3 million, exceeding revenue expectations of $4.5 million to $5 million [8] - Operating loss recorded at $2.7 million, with an adjusted EBITDA loss of $2.3 million, both exceeding internal projections [9] - Gross profit margin for the quarter was 43.3%, down from 50.3% in the prior year [35] - Net loss for Q2 2020 was $1.9 million or $0.25 per diluted share, compared to net income of $186,000 or $0.02 per diluted share in the year-ago period [42] Business Line Data and Key Metrics Changes - Food Service Technology (FST) market revenue increased 7% to $1.2 million, with recurring revenue growing 100% year-over-year to $659,000 [30][18] - Casino and gaming sales fell 76% to $1.4 million, with domestic revenues down 72% and international revenues down 82% [32] - POS automation and banking sales decreased 71% to $481,000, primarily due to lower sales to McDonald's [33] Market Data and Key Metrics Changes - The global casino and gaming markets faced significant challenges, with many casinos closed in the US during the first half of Q2, but approximately 85% were open by late June [11] - The Food Service industry showed varied recovery, with convenience stores rebounding faster than casual restaurants [16] Company Strategy and Development Direction - The company is focusing on enhancing its technology offerings, particularly in the Food Service Technology market, to drive future growth [21] - New product launches, such as Epicentral Clean2Play, aim to address sanitation challenges in casinos [15] - The company plans to leverage its BOHA! solution to capture growth in the convenience store and grocery sectors [20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery in the restaurant industry and the uptick in order activity, particularly in the Food Service Technology market [48] - The company anticipates gradual improvement in sales as the impact of COVID-19 diminishes, projecting Q3 sales between $5.5 million to $6 million [45] - Management highlighted the importance of technology in helping restaurants and casinos adapt to new operational challenges [78] Other Important Information - The company implemented significant cost-cutting measures, resulting in a total savings of approximately $1.7 million in Q2 [25] - The company ended Q2 with $3.1 million in cash and $2.2 million in debt under the PPP loan [43][74] Q&A Session Summary Question: Thoughts on the convenience store market and Speedway acquisition - Management noted a return of orders from a large convenience store customer and highlighted the potential for significant recurring revenue from new label orders [53] Question: Business environment and customer orders - Management reported an uptick in orders in June, particularly in the Food Service Technology market, indicating a positive trend in deal flow and customer interest [61] Question: Balance sheet and debt situation - Management confirmed that the long-term debt primarily consists of the PPP loan, with only $6,000 outstanding under the credit facility [68][70] Question: Technology's role in restaurant and casino recovery - Management emphasized the growing demand for technology solutions in restaurants and casinos as they adapt to new operational requirements [78][82]

Financial Data and Key Metrics Changes - Total net revenue for Q1 2020 declined 11% year-over-year to $10.2 million, with an operating loss of $1.3 million and negative adjusted EBITDA of $1 million [28][59] - Gross profit margin for the quarter was 48%, down from 52.7% in the prior year [53] - Diluted EPS for Q1 was a net loss of $0.13 per share, compared to net income of $0.10 per share in the year-ago period [59] Business Line Data and Key Metrics Changes - Foodservice technology revenue increased 13% year-over-year to $1.4 million, with recurring FST sales at $616,000, nearly double the $310,000 reported in the previous year [48][49] - Casino and gaming sales were $4.9 million, a decline of 10% year-over-year, with domestic revenues down 25% due to COVID-19 impacts [50] - POS Automation and banking sales rose 22% to $1.6 million, driven by strong sales of the Ithaca 9000 POS printer [51] Market Data and Key Metrics Changes - The global casino and gaming market is facing significant challenges, with U.S. casinos closed and a slow recovery expected [12][13] - International casino and gaming revenues increased 15%, offsetting lower demand from Asian OEMs [50] - The foodservice industry is undergoing substantial changes, with many restaurants shifting to takeout and implementing new safety procedures [20][21] Company Strategy and Development Direction - The company is focusing on the BOHA! platform to support foodservice technology and is delaying a product launch to September to align with market conditions [25][26] - A marketing program called "Be Ready" is being initiated to assist customers in adapting to new operational procedures [22][83] - The company is exploring third-party financing options to facilitate customer purchases during the crisis [77] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges posed by the COVID-19 pandemic but remains optimistic about the company's resilience and long-term survival [61][64] - The company expects a slow recovery, projecting Q2 sales between $4.5 million and $5 million, with a gradual return to pre-pandemic sales levels by Q4 2021 [42][44] - Management emphasizes the importance of liquidity measures taken to navigate the current volatility [40][45] Other Important Information - The company implemented austerity measures to reduce operating expenses by an estimated $1.75 million, achieving $700,000 in Q1 savings [33][37] - The company received approximately $2.2 million from the Paycheck Protection Program to support payroll costs [39] - The effective tax rate for Q1 was unusually high at 31.9%, with expectations of a cash refund from net operating losses anticipated in 2020 [56][58] Q&A Session Summary Question: Can you talk about the convenience store market? - Management noted that convenience stores are adapting their product offerings and safety procedures, with ongoing business and unit shipments continuing [69][72] Question: Are you considering providing third-party financing for equipment purchases? - Management confirmed they are exploring options to assist customers with capital constraints and have been proactive in maintaining customer engagement [77][80] Question: What is the expectation for gross margin sustainability? - Management expects gross margin to decline due to reduced sales levels but anticipates recovery as sales improve [88] Question: Can you recap the operating expense savings? - Management detailed that $700,000 in savings were achieved in Q1, with an additional $1.1 million expected in Q2 [91][95] Question: What enhancements are included in the delayed BOHA! product upgrade? - Management refrained from disclosing specific enhancements but indicated it would be a significant new product launch [96][97]

TransAct Technologies Incorporated (NASDAQ:TACT) Q4 2019 Results Earnings Conference Call March 10, 2020 5:00 PM ET Company Participants Marc Griffin - Investor Relations Bart Shuldman - Chairman and CEO Steve DeMartino - President and CFO Conference Call Participants Kara Anderson - B. Riley FBR Mitchell Sacks - Grand Slam Asset Management Jeff Bernstein - Cowen Prime Advisers Operator Greetings. Welcome to TransAct Technologies Fourth Quarter and Full Year 2019 Conference Call. At this time, all participa ...

BOHA! Restaurant Solutions - The restaurant solutions market represents the single greatest revenue opportunity in TransAct's history[7] - The total addressable market for BOHA! exceeds $1 billion in hardware, software, services, and label sales[7, 29] - TransAct has signed agreements related to BOHA! that generate approximately $3 million in annual recurring revenue, with a total sales opportunity of up to $120 million[34] Casino & Gaming - The Casino and Gaming printer business provides a strong financial foundation for TransAct's ongoing investments in its Restaurant Solutions business[51] - Epic Edge is the next-generation casino and gaming printer, offering a more than 2x improvement over current printers with 300 DPI print resolution[53] Financial Performance (3Q19) - Net sales were $117 million, compared to $158 million in 3Q18[60] - Gross profit was $55 million, with a gross margin of 475%, compared to $80 million and 505% in 3Q18[60] - Net income was $04 million, or $005 per diluted share, compared to $26 million, or $033 per diluted share in 3Q18[60] - Restaurant solutions net sales were $1951 thousand, compared to $1481 thousand in 3Q18[59] - Casino and gaming net sales were $5074 thousand, compared to $8267 thousand in 3Q18[59] - EBITDA was $05 million, and Adjusted EBITDA was $07 million[59] Market Opportunity - The total foodservice market includes 1,399,658 potential contact points[30] - This includes 762,715 restaurants and bars, 202,397 retailers, 148,856 travel & leisure locations, 237,850 noncommercial locations, and 47,840 all other foodservice locations[19, 21, 23, 25, 27]

TransAct Technologies Inc. (NASDAQ:TACT) Q3 2019 Earnings Conference Call November 6, 2019 4:30 PM ET Company Participants Jim Leahy - Investor Relations Bart Shuldman - Chairman and Chief Executive Officer Steve DeMartino - President and Chief Financial Officer Conference Call Participants Kara Anderson - B. Riley FBR Mitchell Sacks - Grand Slam Jeff Bernstein - Cowen Operator Good afternoon, ladies and gentlemen, and welcome to the TransAct Technologies Third Quarter 2019 Conference Call. At this time, al ...

TransAct Technologies Inc. (NASDAQ:TACT) Q2 2019 Results Conference Call August 7, 2019 4:30 PM ET Company Participants Jim Leahy - Investor Relations Bart Shuldman - Chairman and Chief Executive Officer Steven DeMartino - President and Chief Financial Officer Conference Call Participants Mitchell Sacks - Grand Slam Asset Management Operator Good afternoon, ladies and gentlemen, and welcome to the TransAct Technologies Second Quarter 2019 Conference Call. At this time all participants are in a listen only m ...

Financial Data and Key Metrics Changes - For Q1 2019, the company reported net sales of $11.6 million, a decrease of 6% from $12.2 million in Q1 2018 [25] - Operating income was $777,000, or 6.7% of net sales, compared to $856,000, or 7% of net sales in the prior year [36] - Adjusted EBITDA for Q1 2019 was $1.3 million, slightly up from $1.2 million in the same quarter last year [36] - Gross profit margin reached 52.7%, attributed to a decline in sales of lower-margin products [33] Business Line Data and Key Metrics Changes - Restaurant solutions sales declined 11% year-over-year to $900,000, driven by lower sales of the AccuDate 9700 terminal [25] - Casino and gaming sales decreased 8% year-over-year to $5.5 million, with domestic sales down 18% due to a large one-time shipment in the previous year [26][27] - POS automation and banking sales fell 26% to $1.3 million, primarily due to a slowdown in sales of the Ithaca 9000 POS printer [29] - TSG sales increased 7% year-over-year to $2.8 million, with BOHA! related sales increasing six-fold over the prior quarter [32] Market Data and Key Metrics Changes - Domestic casino and gaming sales were negatively impacted by a government shutdown and rising interest rates, leading to lower printer shipments in January and February [22] - International sales were up 18% year-over-year, driven by a large order from an Asian customer [28] - Lottery printer sales increased 9% to $697,000, although overall lottery sales are expected to decline as the company shifts focus [31] Company Strategy and Development Direction - The company is focusing on the BOHA! back-of-house ecosystem, which is seen as the largest market opportunity in its history, with potential revenues approaching $100 million [12][51] - The strategy includes increasing awareness through marketing initiatives and participating in industry events like the National Restaurant Association Show [13][15] - The company aims to build recurring revenue through software subscriptions, maintenance contracts, and label sales as BOHA! deployments increase [16][19] Management's Comments on Operating Environment and Future Outlook - Management noted that the restaurant and food service industry is facing challenges with labor shortages and rising costs, creating a favorable environment for BOHA! [9] - The sales cycle for new BOHA! opportunities is expected to take time due to the need for trials and customization [20] - Management expressed confidence in the long-term growth potential of BOHA! and its SaaS-based business model, which is anticipated to drive increased profitability [38][39] Other Important Information - The company ended Q1 2019 with $1.9 million in cash and no debt, returning approximately $700,000 to shareholders through dividends [37] - Two new board members were nominated, bringing valuable experience in the restaurant and foodservice sectors [44] Q&A Session Summary Question: Revenue opportunities with large customers - Management highlighted that the potential revenue from large customers related to BOHA! is approaching $100 million, encompassing hardware, software, and maintenance contracts [51] Question: Development process for BOHA! apps - The company engages with customers to identify pain points and develop apps that address specific operational needs, leading to a collaborative development process [52][53] Question: Inventory buildup - The increase in inventory is aimed at ensuring availability of BOHA! terminals and related hardware to meet anticipated demand from large customers [57][59]

TransAct Technologies Incorporated (NASDAQ:TACT) Q4 2018 Results Earnings Conference Call March 6, 2019 4:30 PM ET Company Participants Bart Shuldman - Chairman and CEO Steven DeMartino - President, CFO, Treasurer and Secretary Jim Leahy - IR, JCIR Conference Call Participants Kara Anderson - B Riley, FBR Jeff Bernstein - Cowen Operator Good day, ladies and gentlemen, and welcome to the TransAct Technologies Fourth Quarter 2018 Conference Call. At this time all participants are in a listen-only mode. Later, ...