Asure Software Inc (ASUR) 2017 Q2 法說會逐字稿

Good morning.

Welcome to Asure Software's Second Quarter 2017 Earnings Conference Call.

Joining us for today's call are Asure's CEO, Pat Goepel; and Director of Human Resources, Cheryl Trbula.

Following their remarks, we will open up the call for your questions.

But first, I would like to turn the call over to Cheryl, who will provide the necessary cautions regarding the forward-looking statements made by management during this call.

Please proceed.

Thank you, operator.

Good morning, everyone.

Before we start, I would like to mention that some of the statements made by management during this call might include projections, estimates and other forward-looking information.

This will include any discussion of the company's business outlook or guidance.

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 uncertainties that could affect their outcome.

You are urged to consider the risk factors relating to the company's business contained in our reports on file with the Securities and Exchange Commission.

These risk factors are important, and they could cause actual results to differ materially from expected results.

Finally, I would like to remind everyone that this call will be recorded, and it will be made available for replay via a link available in the Investor Relations section of our website at www.asuresoftware.com.

With that, I would now like to turn the call over to our CEO, Pat Goepel.

Pat?

Thank you, Cheryl.

I'd like to welcome everyone to our second quarter 2017 earnings call.

We certainly appreciate your continued support.

And whether you're an employee, a client, an analyst, an investor or third-party partner, we sure appreciate your interest in Asure.

Second quarter was a continuation of the same growth and operational momentum we've achieved over the last several quarters and years, and it certainly was an eventful quarter.

We did 2 acquisitions, a capital raise, amended our financial bank agreements.

So certainly, a busy quarter for us.

But we're especially pleased with our top line double-digit growth.

It was at $12.9 million for the quarter.

And what was really encouraging was the increase of 64% of our cloud revenue.

That's revenue that's going to continue to roll forward, and we're very pleased with that result.

We had a 22% increase in hardware revenue, and our cloud revenue as a percentage of total revenue for the second quarter was 69%.

And if I look at last year in the second quarter, we had 56% as cloud.

So clearly, we're on our path for sustained success in the cloud arena.

On top of this, though, our cloud bookings were just outstanding.

We had -- we were up 174% from Q2 last year.

Not only were we driven by HCM bookings, but also some big space bookings as well.

As many of you know, migrating our existing clients to the cloud has been a major initiative for us, and we've seen very good results in that area.

When we migrate a legacy customer, we get about 2.2x revenue when they go to the cloud.

And that is one clear way that we're positioning Asure for long-term success, and our legacy business is down to roughly $4 million a year or so.

So clearly, big momentum in that area.

Our operating costs were slightly higher than planned, primarily due to some nonrecurring, noncash expenses related to the 2 acquisitions that were completed towards the end of May.

We incurred higher noncash stock compensation expenses as a result of our stock going up, as well as higher costs related to our planned transition to an accelerated filer.

But despite this, we were able to generate another quarter of profitability on a non-GAAP basis.

From a client win perspective, second quarter was outstanding and a busy period for Asure.

Our sales infrastructure expanded, and our reach enabled us to secure some major wins from leading organizations, like Anthem, insurance provider; Procter & Gamble, worldwide now.

We won Procter & Gamble in the U.S., now we've won the worldwide account.

So -- and then finally, had a major order from Fannie Mae, the last of which -- and Fannie Mae was a $7 million, or excuse me, a 7-figure deal to roll out our resource scheduler product and our touch space panels in their new D.C. headquarters.

So that was very, very exciting for us.

We had HCM wins, or Human Capital Management wins, with B Green Services and Messerli & Kramer, as well as Zander's Sporting Goods, among others.

So really, really encouraged by the activity in sales.

And as you might remember, January, under our new leadership -- under Eyal Goldstein, we are now selling a whole solution as opposed to an individual solution.

And that's driving up our average deal size, which again was up in the quarter.

Our pipeline is very, very strong.

We continue to expand quarter-over-quarter.

In fact, the number of deals in our pipeline was up about 73%, even from the prior quarter.

So we're reflecting the acquisitions and the additions of the opportunities that come with that in May, as well as our increased cross-sell opportunities in the business.

And the expanded sales force, now that they're trained, are really popping up cross-sell opportunities every day.

In fact, in July, we were able to sign HSBC over in England and Australia, and that bodes well for the third and fourth quarter as well.

Our sales team has been very effective this year.

We're adding new logos to the roster.

And I mentioned the deal size is up.

And then our overall customer acquisition costs are slightly down.

We did increase our bench this year.

We hired Web Hill as our VP and GM of our small business or our Evolution business.

Web worked with me in the past at Ceridian.

He's had a lot of transaction processing in his background and is a great addition to the team.

He had worked in the tax area and the 401(k) area in the past.

He's also had some banking experience.

So very pleased to bring on Web.

Also Bob Dietz, who came from IBM, is now our VP and General Manager of our consulting unit.

And we're really excited to have Coach Bob with us.

He brings a lot of industry expertise with us.

And I'm confident he'll play a role in our success going forward.

And then finally, we added to our Board of Directors, Dan Gill, came from the Evolution acquisition.

He's with Silver Oak Partners.

And Dan is a great guy, fits in well and very, very -- we're lucky to have him.

So we're very pleased to have him on the board.

Finally, in addition to our improving financials and organic growth, Q2 was another dynamic period for our business, where we were able to come to an agreement with iSystems and Compass.

And I've talked about it before.

Our acquisition of iSystems is very consistent with our strategy of buying businesses with a proven technology and a good service bureau custom base, which will give us opportunities to not only cross-sell, but eventually other acquisition targets in the future.

We had tuck-ins early in January this year of CPI and PSNW.

We completed those and we gave you a window into the margin profile and cross-sell opportunity we have with them.

We know that Compass was another Mangrove reseller, so we're excited to have them in May.

And then as we integrate iSystems, I think you'll see that we'll have a very robust transaction pipeline.

And we're excited about that, especially as we look into '18.

But before I talk more about that strategic rationale, integration, operational and financial synergies of the acquisition, I'd like to briefly shift gears to our financial results in Q2.

But first, our CFO search.

As most of you know, Brad Wolfe left the organization and resigned last month.

It's worth mentioning that with his resignation, there was no disagreements, per se, with the company.

Brad elected to return to his private equity roots, and we supported him and his ability to do that.

I am conducting a formal CFO search.

It's underway.

The first round now is nearly complete and will be complete, actually, Tuesday.

Our objective is to hire a CFO with significant mergers and acquisition experience, as well as software experience, specifically SaaS, and then also public company experience, because as you may know, we're going through a public accelerated filer in January of this year, as well as some of the rev rec 606 is going to come upon us here in January.

So what I would say is I've been here 8 years, and the candidate pool is enormous as well as very talented.

So it's, I think, a testimony to how Asure has grown up here over the last 8 years.

But very excited about that.

Also, I'd like to thank the team.

We have 3 CPAs in the company and they're a seasoned team that has done a great job in Brad's absence and they support me terrifically for being able to be in this call today.

On the financials, I'd like to turn -- our revenue was up 33% to a record $12.9 million from $9.7 million in Q2.

The increase was driven by a 64% increase in cloud revenue, 22% increase in hardware revenue.

This was offset by a legacy decline in maintenance support revenue, as well as a 39% decrease in on-premise software license revenue and a 22% decrease in professional services revenue over Q2 last year.

So again, our legacy business is shrinking.

Our new business is built around the cloud and we're excited that our overall reoccurring revenue improved to 79.3% from 72.1% in the second quarter of last year.

Our gross margin was $10.1 million or 78.1% of total revenue.

Our gross margin was up 34% from the $7.5 million or 77.5% of total revenue compared to Q2 last year.

If I further look at profitability, even excluding onetimes, it was $2.2 million, which was down slightly from the $2.6 million we recorded in Q2 of last year.

It's important to note out that we incurred $1.2 million of onetime costs related to the acquisition of Compass, iSystems.

And of course, we had the capital raise, as well as the amended banking agreement.

So a lot of activity here.

I think you'll see in the third and fourth quarters that our costs will settle down nicely.

Our GAAP net loss was $1.8 million or $0.18 a share.

This compares to net income of $136,000 or 2% (sic) [$0.02] per share last year.

Our -- excluding onetime items, our GAAP net loss for the period of second quarter '17 totaled $603,000 or $0.06 loss per share, and this compares to a net income of $967,000 or $0.15 per share of Q2 of last year.

Our non-GAAP net income totaled $717,000 or $0.07 per share.

This compares to our non-GAAP net income of $1.8 million or $0.27 per share in Q2 of last year.

And if you think of Q2 last year, we had the Mangrove acquisition in March.

We were able to take the cost out.

We didn't add growth cost in until after the Q2 of last year.

This year, the iSystems and Compass acquisitions were in May, which is the quarter we're in.

You'll see some of those costs go out the back half of the year.

We mentioned the terrific success we've had in sales.

If we go to backlog, which we define as sales bookings that have not yet turned into revenue or deferred revenue, including both repetitive and non-repetitive product lines, we went up to $18.1 million, a 48% increase compared to the prior quarter, 34% from last year.

We continue to expect many of our enterprise clients to move through the implementation process this year, and that will return in conversion from backlog to reported revenue growth.

Very excited to see.

And again, the Fannie Mae success, as well as HSBC now in July, will bode well for future outlook.

At quarter-end, we had $30.4 million in cash and cash equivalents.

During Q2, we completed a $27.5 million public offering with some really very quality investors, led by Roth Capital Partners.

I think they did an outstanding job in that process.

Concurrent with this, we entered into an amended and restated $75 million credit facility with Wells Fargo and Goldman Sachs.

Wells has been a fantastic partner of ours for a long time.

The Foothill Group out in L.A., and we're excited to add Goldman to our organization.

That will also give us some firepower for future acquisitions.

And I'd like to remind people we have approximately $45 million left on our shelf should we need to raise money, and then we have plenty of borrowing ability, if we need to, for acquisitions.

Going to acquisitions.

I want to turn to Compass first.

We acquired Compass in the quarter for $6 million.

It was $3 million of revenue, $4.5 million upfront, $1.5 million in a seller note.

And as I said earlier, we're going to continue to buy these service bureau acquisitions.

They make perfect sense as it relates to our overall strategy.

We already own the technology, so the integration is much easier than if we were to buy something that we'd have to convert the technology on.

We've begun to successfully integrate Compass into our organization.

They're now joining us in our Tampa facility, and we've begun to realize the revenue and EBITDA improvements similar to what we achieved with PSNW and CPI earlier this year.

iSystems was a big acquisition for us in May.

They're a national provider of Human Capital Management software for service bureaus, and they're focused on independent payroll processors.

Today, iSystems has almost 110 service bureau customers nationwide, which process payroll for 75,000 small and midsize businesses.

This represents an opportunity for us to potentially acquire $130 million in additional payroll revenue.

So we're excited about the partnering that we've been doing with the iSystems service bureaus.

The integration process is going right along as planned.

In fact, we've begun to implement our cost-optimization measures.

We'll take out about $4 million in the business in the third and fourth quarter.

Most of the costs will be taken out in the third quarter and the remainder certainly by year-end.

Our guidance.

We had a strong revenue performance in Q2.

We're increasing our revenue guidance in '17.

We now expect to be between $54.25 million and $56.25 million, which is up from our previous guidance in May of $53 million to $56 million.

We're also revising the guidance for our other metrics.

EBITDA will go to $12.2 million to $13.5 million, which is up from $11.9 million and $13.2 million before.

Our net income or loss per share, excluding onetime items, will be now between $0.06, a loss, and $0.02.

That was revised from $0.02 gain to $0.02 loss, and the reason for that is some noncash stock comp as well as interest expense and a little bit more shares than we previously had, in addition to some naked tax credit that's affecting the bottom line.

Our non-GAAP -- or excuse me, our net income per share of $0.50 to $0.56 is being narrowed from $0.50 to $0.59 and we reduced our EPS guidance slightly because of the noncash expenses and the adjustments, as well as the higher share count from the equity offering in May.

It's worth mentioning our guidance does not include additional acquisitions this year, although M&A activity is brisk.

We have several deals in the pipeline that we're looking at consuming, tuck-in acquisitions that I would say would definitely happen in January.

We wouldn't rule out something happening earlier.

But right now, the guidance does not include that.

Finally, our '18 outlook.

We have a construct with 2018.

We're able to reach double-digit organic growth as well as multiple tuck-in acquisitions, each with approximately $2 million of revenue and with a purchase price of around 2x revenue.

That construct, we seek to reach between $70 million and $80 million of revenue, with EBITDA excluding onetime items of between $16 million and $20 million.

We plan to issue more formal guidance for fiscal 2018 when we report our Q3 results in November.

Clearly, we feel pretty confident on our business.

And as such, we've increased our '17 guidance and start to position the 2018 objectives and the progress we're making both financially and operationally.

Our enhanced and refocused sales efforts are allowing us to capitalize on many opportunities in front of us, a fact reflected by our robust pipeline deals and our resulting updated projections.

So in summary, we entered the second half of the year with a strong financial and operational momentum, a bolstered balance sheet and industry-leading solutions.

These dynamics have favorably positioned Asure for success in '17, as well as '18, and put us on track for our midterm goal of $100 million in revenue with strong double-digit EBITDA margins.

And we remain focused on our key strategic initiatives, which will continue to drive us forward, including accelerating the velocity of our cross-selling opportunities and scaling our business, both organically and through acquisitions.

So with that, I'll take any questions that you may have.

And again, I appreciate your interest in Asure.

(Operator Instructions) And our first question comes from Richard Baldry from Roth Capital.

Can you talk -- if your framework for '18 works out, you'll be roughly 3x the size you were exiting '18 as you were starting '16.

So with that backdrop, can you talk a bit more about the management changes, how you feel about the team you have in place?

Are there other roles, maybe new roles, that you're looking to fill as you really broaden the revenue base of the company?

Thanks, Rich, and I appreciate your support.

I've been fortunate enough to run a couple of billion-dollar divisions in this space of Ceridian and Fidelity.

And as a young company growing, I'm really excited about the talent that we're attracting.

Eyal Goldstein, is our Chief Revenue Officer, who we acquired in December, is just an outstanding executive.

Joe Karbowski, who's been with me since 2012 as the CTO, who now also plays the COO role, has done just a phenomenal job and is well-liked by clients and employees alike.

We did see Christine Bellaire come over from Advantec, where she used to work with me in a PEO, has done a great job in Tampa.

We have Web Hill that we're able to attract from Ceridian.

And he's leading our Burlington initiative.

We're able to bring over some great people from the acquisitions.

And we've done that in the past.

And Joe, among others, with the PeopleCube acquisition, are still with us today and thriving in their roles.

And so it's a model we'll use going forward.

Bob Dietz coming from IBM and has a long history in the consulting area.

So quite simply put, I'm really happy with, not only our first level management, but our second level management as well.

And I believe we'll continue to look for talent as we grow.

But by the same token, now it's all about getting our talent focused and getting to that $100 million objective and then going to the next objective after that.

So feel like we have the right people and the right team in place.

We have a really quality finance staff.

We do need a leader now, as the CFO, and that will be my #1 focus.

I do anticipate that we'll have a CFO probably in the chair somewhere around October 1. We're going to be -- we're not in a rush to sign the right person, but we want that right person because we think we have the right footings to scale this business in a big way.

And maybe talk about the sales side of it.

It sounds like your pipeline is increasing pretty fast.

Do you feel like you need to hire organically to keep supporting that?

Do you think that maybe some acquisitions -- your acquisition pipeline will bring in sort of the headcount you'll need, so not as much need to hire there organically?

How do we think about that?

Yes -- no, I think it's a good question.

I mean, I think we're looking at acquisitions as part of our growth strategy.

One, we think we have an incredibly efficient acquisition model because we already own the technology.

We do think that there's some people that we're talking to that would help the organization, but we're also looking at people's networks to hire proven sales professionals.

We'd love to see our sales force continue to build out as we're getting success.

By the same token, we don't want to get ahead of ourselves.

So that combination of internal growth as well as acquisitions, I think we've laid it out, how we're thinking about it internally, and we'll continue to look to top-grade talent and increase salespeople as we go forward.

And one of the things is it's a little bit about this call.

I could go to an analyst meeting or go to a conference, and I'd offer free beer, and I couldn't get 5 people to show up 3 years ago.

And now I have a lot of people interested in Asure.

It's the same way with potential salespeople.

When you have a little success, people want to join you or be part of the organization.

So we will look to hire opportunistically through the back half of the year.

Our next question comes from David Hynes from Canaccord.

Pat, I wanted ask about the M&A pipeline.

So when you did Mangrove and iSystems, I'm sure you pretty quickly identified those folks who were likely to be the first movers in terms of the SBOs ready to cut over to Asure.

My question, I'm curious what you can do today and how you're thinking about cultivating that next level down of M&A opportunities and those that might impact the business in '19 and beyond.

Yes, and I think that's a great question, DJ.

And again, thank you for the recent conference I was at.

It was an excellent conference.

Well, what we're doing right now is we're talking to everybody.

And the nice thing about it is we want to grow our partners in general.

So whatever they need, cross-selling opportunity, benefit capability, HR capability, we're trying to furnish them to help them grow.

And clearly, we have a pipeline that we feel really good about for early '18.

And we -- one of the objectives was to not to grow too quickly this year, because we want the organization to settle down with the 2 acquisitions.

But I think you'll see some movement in January, if not before.

And then around back half of '18 and '19, we already have identified -- it's almost like an airplane runway, if you will.

We've identified some of those folks as well.

And they're just logical extensions of growth conversations that we're having.

And what I would say is, if you do the right things, good things will happen.

And I believe our organization is doing the right things right now.

We're building really good relationships.

We're starting to understand them.

And by the way, if we help them grow, we're going to grow, which is a win-win.

And if they decide, in some cases, they want to exit based on a life event or based on where they're at in life, that will help us, too.

So either way, we feel blessed that we're developing really good relationships with a good pipeline, both organically and with acquisitions.

Yes, makes sense.

And then a couple of nice space wins in the quarter.

Just remind us kind of the implementation cycles there.

How long those deals typically take before they start contributing to the numbers?

Yes, I think on Fannie Mae, you'll see, for sure, see some implementation dollars and some SaaS-related dollars in '18 -- or excuse me, in '17, and then you'll see them in '18.

I think some of the hardware you'll see in '17, as well as the beginnings in cloud revenue, certainly, by '18, I'll call it certainly, by July of '18, I think all of it will be installed.

I do think the first phases will get done by October, and then the second phase will be done by January, with the remaining cleanup, let's say, the first half of '18.

Yes, okay.

And then one last one, maybe.

I assume maybe it's tied to those deals, but the uptick in receivables in the quarter, was it just the timing of when those deals closed and the cash collections are still coming?

Or how should we think about kind of the cash flow impact?

Yes -- no, I think that's a good point.

I think the evergreen -- one of the things that we have done as a SaaS company is our contracting process.

We have adopted a more evergreen approach, and that evergreen is allowing receivables to really hit the books almost 60 days earlier than in previous.

I think from a cash flow perspective, the second half of the year will give us more cash flow.

I think you'll see that as a result of this process, cash flow -- or receivables will come down after this onetime kind of spike in receivables, some of it due to acquisitions, some of it due to the evergreen renewal, where we're booking receivables earlier.

So I think you'll see some noise about that right now, but over time, that cash flow will increase and the receivables will normalize.

Our next question comes from Eric Martinuzzi from Lake Street Capital.

Curious to know on the organic growth rate.

I'd really love to know on the cloud revenue side, what the organic growth rate was, kind of Q2 versus Q2 a year ago.

And if you don't have it at that level of detail, maybe just the total revenue, kind of a pro forma analysis of the organic growth rate.

Yes, Eric, thank you for the question.

I should have mentioned it in my remarks.

I would say there's a fair amount of noise in the number with the Mangrove acquisition and then the 5 acquisitions this year.

What I would say, our legacy business is probably down in the area of 20%.

I would say a rough number is -- our organic second quarter growth was around 10% or so.

We hope to normalize that and get a better breakout of that, but it's about 10%.

And with legacy, we're decelerating in the area of on-prem, some PS and as well as maintenance and support.

And we're increasing cloud.

So I would say, roughly, it's about 10% organic growth.

And we're getting further refinement of that number, but there's some noise in that number.

Okay, it makes sense.

Just on the -- you talked about the success of Compass versus PSNW and CPI.

When you talked about PSNW and CPI last quarter, you were saying that top line increased over 10%, and the EBITDA margin's in excess of 50%.

You're saying you're getting that exact same flow-through on Compass?

No, I wouldn't say that.

What I would say is Compass does have one large client with us.

So I would say we're getting that same flow-through with the exception of that large client.

And I do anticipate that, that flow-through and same profile will happen by January.

But for the initial phase of this, we're right on track.

Okay.

And then just a housekeeping item.

Do you have the share count?

I'm just wondering where we are right now for -- or what weighted average share count you're using for the $0.50 to $0.56 for the full year?

I believe that's roughly 10 million shares.

(inaudible)

I can further pick that up, but I'm sure it's almost 10 million shares.

(Operator Instructions) And our next question comes from Vincent Colicchio from Barrington Research.

Pat, just a couple for me here.

So have you retained all key personnel from your recent acquisitions?

Yes, the one -- well, I think we have done some planned cuts, but the people that we wanted to retain and thought was very important to retain, we have good relationships and have retained those.

So I'm not aware -- in fact, our turnover rate is probably lower than it has been.

And that, I think, is a tribute to our stock ownership plan, but we've been able to retain all the right people.

And the service bureau market, has there been any change in multiples at all?

Or is it just as easy to find your targeted type of valuation as it was a few months ago?

No, I mean, first of all, it's never easy, but I do believe we have a captive proposition for people.

And we do have the right area of communication, et cetera.

So I don't think there's any change at all in multiples.

And I've seen a couple of new competitors come -- in the -- VC-backed competitors in the space management market.

Have you seen any of them become meaningful competitors or not?

Yes, I mean, I think there are some VC-backed competitors, and I think that's adding to the marketplace.

I don't think we're incredibly worried about them.

But in the -- there's -- it's certainly a very competitive space, and we got to do a great job every day.

Thank you, Vincent.

And Eric, for those of you -- Eric, the share count was 9,980,000.

So I said 10 million, 20,000 shares short of that, but that was the share count.

Our next question comes from Mike Latimore from Northland Capital.

Just on the sales cycle.

Any general comments on how that's been trending now that you're selling through the full suite?

Yes, Mike, I think we're right along at where we want to be.

I think sales -- deal size is up, and it continues to go up.

In the quarter, it was up again another 10% or so.

What I would say is the velocity of deals is about the same.

So I think we're selling bigger deals, but we're selling them at a higher level in the organization, and that's helping us move through the process, even though they're bigger deals.

So I would say we're right on pace.

I think that figure will become very important in the second half of the year.

As you know, January installs are really important in the HCM business, and we have a couple of product innovations that are due here in the August to -- end of August to October time frame.

And I want to see that number continue to have success, but I'm very cautiously optimistic that we'll be about the same, with average deal sizing going up.

Great.

And then the gross margin was very strong again.

Is that kind of a sustainable level, do you think?

Or does that move around a little bit, or...?

It certainly moves around a little bit depending on some of the hardware numbers, et cetera, but I would say we're increasingly getting confident in our gross margin number.

I would anticipate we should be fairly close, maybe there'd be 1% compression due to hardware, but we should be in that number.

Yes, okay.

And then just in terms of the service bureau acquisition opportunities around iSystems.

Should we think of -- should we think about that as the multiple being similar, the accretion opportunity being similar and the competitors being similar to what you've seen in the Mangrove world?

I think so.

I would say we're right in the middle of some conversations now.

I think that Mangrove is certainly a good benchmark.

And I would say that's exactly where we want to be and feel like we can do a great job for people in that area.

And I think that's where it'll end up.

As far as competitors, et cetera, I think it's the usual suspects, and I don't think it's changed much at all.

Great.

And then just lastly, the HSBC deal.

Can you mention what product that was again?

And then is there kind of a land-and-expand opportunity there as well?

Yes, absolutely, land-and-expand opportunity and resource scheduler with some of our panel solutions.

And so we're excited about rolling that out, not only in the countries I mentioned, but worldwide.

And I am showing no further questions from our phone lines.

I would now like to turn the conference back over to Mr. Goepel for any closing remarks.

Yes -- no, I just want to thank everybody for the conference call and everybody that's been on it.

We take this business very seriously.

In the second quarter, if you think about what we've been, really the first half of the year, we've had 5 acquisitions.

We've had a capital raise.

We had a new banking agreement, and we're partnering with Wells Fargo and Goldman Sachs, who are fantastic partners.

We have an organic strategy that's going to grow.

We have an acquisition pipeline that we feel really good about.

I'd really like to thank our people.

They've done a great job the first half, and they're all-in to our mission.

And I think it's showing.

We were a little disappointed with the EPS.

But when you consider that some of those charges were transaction-based and not cash, clearly, we have some momentum here going into the second half of the year.

And we feel blessed that we have the right kind of partners and activity to grow this business for quite some time.

And we'd love to thank you for your interest and your personal investment into Asure Software.

With that, we'll see you in the third quarter, and have a great day.

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

I would like to remind everyone that a recording of today's call will be available for replay via a link available in the Investors section of the company's website.

This concludes Asure's Second Quarter 2017 Earnings Call.

Thank you, and have a great day.