Asure Software Inc (ASUR) 2009 Q4 法說會逐字稿

Good day, ladies and gentlemen and welcome to the Q4, 2009 Asure Software earnings call.

My name is Melanie and I'll be your coordinator today.

At this time all participants are in listen only mode.

We will conduct a question and answer session at the ends of this conference.

(Operator Instructions).

I would now like to turn the call over to Miss Lisa Flynn.

Thank you, Melanie.

Welcome, everyone, to Asure Software conference call.

Before we start, I'd like to mention that some of the statements made by Management during this call might include projections and other forward looking information.

This will include any discussion of the Company's business outlook.

These particular forward looking statements and all of the statements that may be made on this call that are not historical are subject to a number of risks and uncertainty that could affect their outcome.

You are urged to consider the risk factors relating to the Company's business contained in our latest periodical report on file with the Securities and Exchange Commission.

these risk factors are important and they could cause actual results to differ materially.

This call is also being recorded on behalf of Asure Software and is copywrited material.

It cannot be recorded or rebroadcast without the Company's expression permission and your participation implies consent to the call's recording.

After we've completed our review of the quarter, we'll open up the call for questions.

I would now like to turn the call over to David Sandberg, Chairman of the Board.

Thank you, Lisa.

Dear shareholders, welcome to Asure's fourth quarter and fiscal 2009 year-end conference call.

The facts are what they are so I'm just going to be blunt.

It's been a very difficult year for Asure and Asure stockholders.

We had to fight incredibly hard against a entrenched prior Board in order to prevent their go private attempt, a go private attempt under which liquidity almost assuredly would have deteriorated, while management would have been less scrutinized due to less stringent reporting requirements.

Shareholders voted this down by a wide margin such that Asure canceled the entire special meeting.

We then had to fight equally hard in an annual proxy contest to elect a Board represented by shareholders and with the mindset to stop Asure's massive cash burn witnessed under Asure's former Board Management under which tens of millions of dollars were burned over the prior five years alone.

This was not easy and the former Board put up a fight despite not owning much stock themselves.

They spent millions of dollars of shareholder's money fighting for control, including huge amounts in a lawsuit no against no less than 18 of Asure shareholders even after they had just lost a lawsuit to Jenkins and Gilchrist, costing shareholders over $4 million.

While all of this was occurring, they delayed annual meetings several times and maintained excessive spending, which resulted in continued sizable operating losses and cash burn throughout the year.

The end result of all this effort and spend, while the prior Board lost the Director elections by an even larger margin, more than two to one despite having the advantage of entrenchment, lost all four times in court and the suit against their shareholders was ultimately was dismissed entirely by the court.

Again, these are simply the facts.

What did this do to Asure's balance sheet?

It sits today at approximately $3 million cash or $0.09 to $0.10 per share versus roughly $14 million in cash one year ago.

However, what did occur, shareholders did, in fact, vote for change.

Did overwhelmingly support and elect a Board comprised of much greater shareholder ownership than the prior Board.

We are pleased to report that in less than two months since shareholders replaced Asure's entire Board, we believe Asure's business has stabilized in both in EBITDA and cash flow basis.

Importantly, Asure's two businesses, NetSimplicity and iEmployee, remain stable while generating $9 million to $10 million annually in high margin, recurring revenue through strong product suites.

We're ecstatic to have brought on Pat Goepel as interim CEO, and he is off to a fantastic start with numerous growth initiatives underway, while effectively managing costs.

Our plan is simple, improve an already strong suite of products across our two businesses, sell better and service the customer better, drop incremental margins to the bottom line and utilize our greater than $150 million tax loss carry forwards to create additional shareholder value.

Briefly, on these tax loss carry forwards, today, we have approved and will file an 8-K detailing a newly adopted rights plan designed to protect and preserve Asure's tax loss carry forwards.

This plan limits shareholders to 4.9% ownership, but it dissolves if the carry forwards every become limited thus insuring that its purpose is not to entrench the current Board.

Lastly, I am happy to report that we have named December 17th, 2009, as our target date for Asure's 2009 annual meeting.

At this meeting, we will ask shareholder's to vote on several important proposals, including to ratify A-- the election of Directors; B-- Asure's accountants for 2010, sorry, auditors for 2010; C-- forges name change to Asure Software, Inc.; D-- a reverse split either ten for one or fifteen to one, it will be to be determined in order to satisfy NASDAQ's minimum bid price requirement and to maintain our listing; and, E-- the adoption of the aforementioned rights plan.

We believe that all of these are important on our road to realizing shareholder value.

All of this has been a lot to chew on.

I urge shareholders to look forward and focus on performance and value of our businesses.

With that I'd like to introduce Pat Goepel.

Thanks, David.

I'd like to welcome all the fellow shareholders.

And I have been on the job about six weeks; four weeks as a CEO.

I've spent time in that four weeks with clients, employees and shareholders, and a member of the Board.

And walking away, we have really two solid businesses, and I'm looking forward to the day in the not so distant future that they are profitable.

What we know today and based on the observations is that we're in a great market.

The marketplace for both NetSimplicity and iEmployee is very big and it's growing and we intend to get our sizable share of that marketplace.

We have great clients.

In the iEmployee base, we have Advanced Auto Parts, DeVry Institute, March of Dimes, Playboy Enterprises, SalesForce.com, Time Magazine.

We have NetSimplicity customers, including Boeing, General Electric, Nestle Global, Macy's, so we have a client list to die for.

We are committed to staff, business software and service and technology enabled software businesses, and we have some very talented employees.

We're also committed to growing the business.

We believe the public market is good and will reward us as we perform in the future, and we will be accountable to performance.

We believe that the NOLs are ultimately a positive and will look to use them in the future.

We have a real estate deal that is problematic, and we'll have to work through it in the future, but once we do work through it in the future, we will be -- it will be much more positive for Asure as the Company.

And we have cash in the bank and after Q1, really we have to debt.

So what we will do is continue to simplify the business, we'll grow the business, and we'll reward shareholders.

We're optimistic that the one-time events, as David spoke of, are mostly behind us and we look forward to a very, very exciting 2010 calendar year.

Just a recap of the quarter, Q4 we had a revenue of positive growth of 1%.

Our operating expenses increased to $4 million.

However, we had one-time costs were about $4.4 million.

So our loss excluding one-time costs of $799,000 in the quarter.

In Q1, we anticipate that we'll be approximately EBITDA neutral.

We'll still have approximately $1.3 million of costs or so, and we mentioned in the press release that we have about $375,000 a quarter in cash burn of the real estate.

We'll look to work out a better real estate deal in the future.

And in Q1, I can also say that sales bookings in Q1 should be ahead of Q4, which now that we've gotten some of the noise behind us, we think we'll be much more optimistic going forward where we can focus on business.

With that, I'm going to open the floor in the call for questions, and David and I would be happy to take questions.

(Operator Instructions).

And I show no audio questions at this time.

Okay.

If there are no further questions, we have a press release out there.

We -- I did want to make sure I had somebody in the room say Q1, we're going to be EBITDA neutral excluding some one-time costs.

I want to make sure I got across that.

We are available to answer any questions and if not, we'll close the call.

But I'll leave a thirty seconds for answering questions.

Okay.

We'd like to thank you for your time and thank you.

That now concludes the Asure quarterly earnings call.

Ladies and gentlemen, thank you for your participation in today's conference.

That does conclude the presentation; you may disconnect.

Have a wonderful day.