NetSol(US:NTWK)2023-11-07 22:51Financial Data and Key Metrics Changes - Total net revenues for Q1 2024 were $14.2 million, up from $12.7 million in the prior year period, representing a growth of approximately 11.8% [6] - License fees increased to approximately $1.3 million compared to $250,000 in the prior year period, showing a significant increase [6] - Recurring revenue from subscription and support was $6.5 million, up from $6 million in the prior year period [7] - Gross profit for Q1 2024 was $6.2 million, or 43% of net revenues, compared to $4.3 million, or 33% of net revenues in the prior year [22] - GAAP net income for Q1 2024 was $31,000, or $0.003 per diluted share, compared to a net loss of $621,000, or a loss of $0.06 per diluted share in the prior year [23] Business Line Data and Key Metrics Changes - The company recognized approximately $1.3 million in licensing revenues from Isuzu Motors, indicating a focus on securing more licensing deals [3] - SaaS-based revenue and services revenue continued to show consistent growth, contributing to overall revenue stability [3][5] Market Data and Key Metrics Changes - The company is actively expanding its presence in the US market, which is viewed as a largely untapped opportunity [19] - The SaaS-based platform Otoz is now operational in 60 MINI Anywhere dealerships across 37 US states, demonstrating demand for SaaS products in the market [20] Company Strategy and Development Direction - The company aims to drive more predictable revenue through additional licensing deals and expansion of its SaaS offerings [5] - There is a strong focus on cost containment to free up capital for growth opportunities, particularly in the US market [4] - The company is also evaluating strategic acquisition opportunities in North America to bolster its market presence [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth potential in the US and China, citing robust market conditions [11] - The company is committed to investing in talent and resources in the US to enhance its competitive position [36] - Management highlighted the importance of maintaining cost discipline while focusing on revenue growth as a key strategy for building long-term shareholder value [25] Other Important Information - Non-GAAP adjusted EBITDA for Q1 2024 was $466,000, or $0.04 per diluted share, compared to a loss of $28,000, or $0.002 per diluted share in the prior year [9] - The company had cash and cash equivalents of approximately $16.6 million at the end of the quarter [24] Q&A Session Summary Question: Expectations for margins and profitability - Management indicated that margins and profitability are expected to continue improving, with a focus on revenue growth [28] Question: Success rate in bidding for new customers - Management noted that while they often get shortlisted, competition from larger US companies can be a challenge [30][41] Question: Discussion on minority interest and investments - Management acknowledged the costs associated with minority interests but emphasized the importance of investing in talent and technology to stay ahead [31][44]