SoundThinking(US:SSTI)2020-08-08 14:45Financial Data and Key Metrics Changes - The company reported quarterly revenues of $11.3 million, a 10% increase from $10.3 million in the same quarter last year [8][33] - Net income for the quarter was $866,000 or $0.07 per diluted share, compared to $387,000 or $0.03 per diluted share in Q2 2019 [8][37] - Adjusted EBITDA for the second quarter was $3.4 million, a 41% increase from $2.4 million in the prior-year period [34] Business Line Data and Key Metrics Changes - The company went live with 26 new mines, including expansions in Cincinnati and New York City, and new deployments in Springfield, Illinois, Albuquerque, the U.S. Virgin Islands, and Mammoth County, New Jersey [8][9] - Six multiyear contracts were renewed in Q2, representing nearly $7 million in bookings [14] Market Data and Key Metrics Changes - The number of ShotSpotter loaded gunfire incidents increased by 34.6% year-to-date 2020 compared to 2019, and over 68% since the George Floyd incident [23] - The company has expanded its presence in New York City to cover approximately 74 miles [21] Company Strategy and Development Direction - The company aims to enhance its value by providing complementary solutions to its core gunshot detection technology, including an emissions platform for crime trend analysis [27] - The management believes that the "Defund the Police" movement may represent a potential catalyst for the business, as it aligns with the demand for precision policing [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's long-term opportunities, noting that public safety remains a priority for municipal budgets [42] - The company expects to remain profitable in both Q3 and Q4, as well as for the entirety of 2020 [39] Other Important Information - The company ended the quarter with $25.8 million in cash and no short or long-term debt, while planning to raise the borrowing limit on its revolving line of credit [38] - Deferred revenue at the end of the quarter was $23.3 million, down from $24.6 million at the end of Q1 2020 [37] Q&A Session Summary Question: Can you provide clarity on the revised guidance range? - Management narrowed the guidance due to increased visibility, expecting attrition to be around 2% to 3% instead of the previously anticipated 5% [46][47] Question: What is the potential for further expansion in New York City? - Management indicated that New York City is fairly well deployed, covering over 70 square miles, and further significant expansion is not expected at this time [48][49] Question: How is the selling cycle changing in the work-from-home environment? - The company is finding innovative ways to engage prospects digitally and has seen increased inbound interest due to social unrest and rising gun violence [54][56] Question: Can you comment on the disinformation campaign mentioned? - Management noted that while there is energy around the "Defund the Police" movement, the core of the movement focuses on reimagining policing rather than abolishing it [61][63] Question: How is the company addressing budgetary meetings for municipalities? - Management is optimistic about maintaining normal attrition rates and is prepared to assist municipalities in finding funding to support their ShotSpotter services [70][72] Question: Are there challenges in deployments due to COVID-19 restrictions? - While some mobility has returned, challenges remain in certain areas where restrictions are still in place [74][90] Question: How are Latin American opportunities progressing? - The pipeline for Latin American opportunities is strong, with expectations for at least one booking before the end of the year [83] Question: How does the current level of interest compare to last year? - The current pipeline is stronger than last year, driven by the increase in gun violence [87]