Aspen Technology Inc (AZPN) 2007 Q2 法說會逐字稿

Good afternoon. My name is Kashina, and I'll be your conference operator today. At this time, I would like to welcome everyone to the Aspen Technology Second Quarter Fiscal 2007 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. [OPERATOR INSTRUCTIONS] Thank you. Mr. Brad Miller, Chief Fiscal Officer of Aspen Technology, you may begin your conference.

Thank you. Good afternoon, everyone. I'm Brad Miller, CFO of AspenTech, and with me today is Mark Fusco, President and CEO. I'd like to welcome you to our second quarter fiscal 2007 financial results conference call. Before we begin, I will make the usual Safe Harbor statement, that during the course of this call we may make projections or other forward-looking statements where the financial performance of the Company that involve risks and uncertainties. The Company's actual results may differ materially from the projections described in such statements. Factors that might cause such differences include but are not limited to those discussed in today's earnings release and in our most recent Form 10-K filed with the SEC. Also, please note that the following information is related to current business conditions and our outlook as of today, February 6, 2007. Consistent with our prior practice, we expressly disclaim any current intention to up date this information prior to release of our third quarter fiscal 2007 financial results, which is scheduled for some time in May.

The structure of today's call will be as follows: I will begin the -- with the financial details of the quarter. Mark will then provide additional color to our second quarter performance and highlights. Finally, I'll finish by providing up dated guidance.

Before we begin, however, I will point out that as we discussed in our earnings press release, we will only be covering our P&L results down to the operating income line, in addition to selected balance sheet items. The Company expects to restate its previously issued financial statements for fiscal years 2004 through 2006 and the first quarter of fiscal 2007, relating primarily to non-cash adjustments in the company's previously reported other income, which is a non-operating item in our P&L. These adjustments relate taught non-cash translation of our non-dollar denominated foreign subsidiaries in our consolidated financial statements.

In the fiscal year 2004, 2005, '06, and the first quarter of fiscal '07, non-operating income is expected to increase by approximately $4 million, decrease by approximately $3 million, decrease by approximately 5 million, and increase by approximately $500,000 respectively. In addition, nonoperating income in the second quarter of fiscal 2007 is expected to reflect a non-cash benefit of approximately 3 to $4 million as a result of the accounting treatment being applied in the restated results.

The Company also expects that the restated financial statements will also reflect the correction of errors identified in the current period close, which is expected to reduce net income by approximately $400,000 in the second half of fiscal 2006, with a corresponding increase in net income in the first quarter of fiscal 2007. Accordingly, previously issued financial statements and the related reports of our independent registered public accounting firm should not be relied upon. We are focused on completing this process as expeditiously as possible.

Turning to our business, we are very pleased with the Company's operating performance in the quarter, which was highlighted by revenue and profitability that were ahead at the top end of our guidance.

Taking a look at the results for the quarter. Total revenues for the second quarter were a record $96.4 million, representing growth of approximately 26% on a year year-over-year basis. Within total revenue, software licenses came in at a record $60.9 million, while services revenue came in at 35.5 million. Software license revenues increases 45% year over year, due to continued strength in sales of AspenONE Solutions across each major product category, coupled with the benefit from the closure of several deals that were the multi-million dollar range. To put the large deals in context, our average deal size for seven-figure transactions was approximately $4 million in the second quarter, compared to approximately $1 million in the previous quarter. This is not a statistic that we plan on sharing in the future, but we believed it was important to provide further detail given the significant level of up side to our top and bottom line results.

License revenue drove the majority of our overall revenue growth and remains our primary focus, as it is the source of our highest margin revenue. During the quarter, services revenue increased slightly on a year -over-year basis. We view consulting services as a strategic business. However, its primary focus is on enabling the success of our customers and driving our license revenue. Our consulting revenue was flat on a year -over-year basis, while growth in our maintenance business led to slight growth in the total services line.

In terms of details, we closed eight transactions in excess of $1 million during the second quarter of fiscal 2007, compared to six in the same quarter of fiscal 2006. In addition, we closed 19 transactions between $250,000 and $1 million during the quarter, as compared to 17 in the prior year's second quarter. Our average sales price this quarter, based on transactions above $100,000 was approximately 650,000, compared to 570,000 in the prior year's second quarter.

Turning to profitability. This quarter demonstrated the operating leverage of our financial model, where increases in license revenue off of a largely fixed cost base drive improved profitability metrics across all key lines. In the quarter, gross margins on licenses were 94%, an increase from 90% in the prior year's second quarter, due to the up side in license revenue, while services gross margins were 48%. GAAP total costs and expenses were $70.6 million for the fiscal second quarter, an increase from $68.0 million in the second quarter of last year.

Taking a look at the individual operating expense lines, sales and marketing came in at 22.1 million or 23% of revenue. On an absolute dollars basis, sales and marketing was up compared to the previous quarter, due to variable costs associated with the strong increase in license revenue.

R&D came in at $10.7 million or 11% of revenue. The over $2 million increase in R&D expense from the previous quarter was due to continued investments in our AspenONE Solutions, in addition to a lower revel of capitalized software development costs in the quarter.

G&A came in $13.8 million or 14% of revenue. On an absolute dollars basis, the increase of over $3 million from the previous quarter was related to up grading our IT systems, employee incentive plans, and stock-based compensation. Our operating expenses in the second quarter of fiscal 2007 included $3 million of non-cash stock-based compensation, $1.3 million of non-cash amortization of intangibles, associated with previous acquisitions, $589,000 in restructuring charges, and $194,000 gain on sales and assets.

Including these expenses, AspenTech delivered a record GAAP operating profit of $25.8 million, represent an operating margin of 27%. Of note, our operating margin performance was reduced by 5 percentage points, due to the previously mentioned nonrecurring and non-cash items in the quarter. We will provide nonoperating income and earnings per share results for the quarter as soon as we complete the previously discussed restatement process.

Turning to the balance sheet. We ended Q2 with $93 million in cash, up from $89 million at the end of the prior quarter. The increase in cash was driven by very strong cash flow from operations, which was the result of our strong operating profitability and strong cash collections on our accounts receivable during the quarter. Our cash from operations was $30.6 million during the quarter, which was offset by a $27.4 million cash dividend payment related to the conversion of our Series D1 preferred shares in December. DSO for billed receivables was 48 days versus 52 in the same period last year. Including the unbilled receivables, our DSO was 57 days, as compared to 63 in the prior year period. On the liability side of the balance sheet, we remain virtually debt free. In addition, total deferred revenue ended the quarter at $59 million, a slight increase on a year year-over-year basis.

With that, let me turn it over to Mark so he provide a more qualitative prospective on our December quarter performance.

Thanks, Brad. We were pleased with the Company's operating results in the quarter, and I would like to thank all of our employees for their hard work and focus that helped to drive such strong financial performance.

Over the past two years, we have worked very hard to improve the operating execution of the company. The strong growth and profitability that the company has delivered at the halfway point of this fiscal year is a reflection of the success we are having in these efforts. Our second quarter license revenue growth drove record total revenue that was 15% above the high end of our guidance. While we are pleased with this performance, given the quarter to quarter seasonality of our business and the impact that large transactions can have on our quarterly results, we believe it can be more relevant to evaluate our performance on a half year basis.

Last quarter you will recall that while we delivered better than expected profitability, we discussed the timing on certain large deals led to a slight shortfall on the top line, though we remained confident, due to our strong sales pipeline. During the second quarter, we not only closed some of the business that moved out of the first quarter, but we also had very strong overall close rates in the second quarter. Looking at our business on a semi-annual basis helps to normalize revenue timing differences, and on that basis, AspenTech has delivered license revenue growth of 35% and total revenue growth of 18% in the first six months of fiscal 2007, both of which are ahead of our long term targeted growth in the low double digit range. In addition, our focus on license revenue gross, while closely managing our expenses has led to significant cash flow from operations and a six-month operating margin that is above our long-term operating target of 20%, after adjusting for the impact of nonrecurring and/or non-cash expenses, such as stock-based compensation and amortization of intangibles. This is both the first quarter and the first time the Company has met this operating target goal at the halfway point of the fiscal year.

The strength of our business momentum is being driven by multiple sources. First, the process manufacturing industries that we serve are strong, including energy, chemicals, engineering and construction, among others.

Second, our solutions help our customers earn greater returns with with their operating assets and pay back on AspenTech investments can generate return in months. With margins that can be razor thin in commodities markets, optimizing efficiency becomes increasingly important during difficult times. On the flip side, our solutions can help to optimize our customer's plant operations to meet strong and increasing surges in demand.

Third, the fact that feed stock prices currently are and will likely continue to be volatile is what presents a major challenge to process manufacturers. When manufacturers don't know if the feed stock prices are going to go up or down by 20% in the up coming months, it makes it all the more important that they invest in technology to ensure that they are able to maximize their efficiency in both environments. We routinely receive questions from investors as to the impact on our business depending on whether the price of oil is going up or whether it is dropping. We believe our business should be strong in both situations, and the increasing momentum of our business over the past 12 months, when oil has increased sharply and decreased sharply is evidence of that.

Looking at the vertical details in the quarter, our top ten deals included contributions from each of our major verticals. Five in energy, three in chemicals, and two in engineering and construction. This was the fourth quarter in a row that we delivered strong results from the energy sector. It was once again the largest contributors to our overall results, with purchases across engineering, plant operations, and supply chain. These deals included further investments in existing deployments, as well as the purchase of new solutions. Chemicals also had a particularly strong performance, including the second largest deal in the quarter. In addition, we closed our second customer for the ethylene scheduling module and our aspenONE for chemical solution. We believe there is significant opportunity to sell this solution to many other ethylene manufacturers, and AspenTech is the only vendor with this unique set of capabilities. We believe that demand remains solid in the chemical sector as well.

Finally, engineering and construction made another strong contribution to our revenue, and the combination of energy, chemicals, and the E&Cs made up about 90% of our revenue during the quarter.

In addition to strong macro trends, AspenTech is benefiting from several additional factors. First, we have industry leading domain expertise and a very strong market share position across each individual solution category in which we compete: Engineering, plant operations, and supply chain. AspenTech is also the first and only vendor delivering an integrated end to end suite.

Second, over half of our license revenue comes from our term-based engineering business. Because of the mission critical nature of our software and the fact that we have very high levels of customer satisfaction and loyalty, our renewal rates are best in class. We continue to see a rich pipeline of engineering opportunities in the second half of fiscal 2007 and beyond.

A third factor is that the launch of aspenONE has been highly successful. During the second quarter, aspenONE related solutions accounted for a record 50% of our license revenue, due in part to the mix of transactions closed during the quarter. We would not change our expectation that aspenONE-related sales may represent somewhere between 20 to 30% of our sales on a longer-term basis. That said, we continue to expand the breadth and depth of our aspenONE suite where we have vertical specific modules for each of our core vertical markets, including pharmaceuticals.

We recently shipped the latest version of aspenONE, which provide increased functionality across the suite, further improvement and integration between modules that support related business processes, greater support for industry standards, and additional vertical-specific data models. As it relates to data models, we also recently announced an industry first by combining Aspen's property data from that from the National Institute of Standards and Technology. This will more than double the number of components in our library, by adding over 12,000 new compounds. The new components will allow users to more accurately and efficiently model a much wider range of processes. This is just another example of AspenTech leading the market from a technology and domain expertise perspective.

In summary, the Company's operating performance at the halfway point of the year has been very strong across all of the key metrics by which we manage our business. Our six-month revenue growth and operating profitability were both above our long-term targets and cash flow generation was very strong.

In addition to the improvement in our operational performance, the conversion of our preferred stock was another step to its simplifying our ownership structure and eliminating over 15 million per year in future preferred dividends. We were able to use our strong cash flow in order to meet our preferred obligations, paying the accumulated dividends in cash, rather than stock. We believe this was a significant benefit to our common shareholders.

We are very pleased with the overall progress we have made to better position AspenTech for approved shareholder value as we head into the second half of fiscal 2007, and we are optimistic about our outlook.

With that I'll turn it over to Brad for up dated guidance.

Thanks, Mark. Let me finish by providing fiscal 2007 third quarter guidance. As we began on our Q1 earnings call, our guidance will be on a GAAP basis, and we'll identified expected non-cash or nonrecurring expense items. We expect to see total revenue in the range of 77 to $81 million in the third quarter. Within our total revenue, due to typical seasonality and in the counseling services business we would expect our services revenue to increase slightly on a sequential basis.

As it relates to license revenue, the December and June quarters are typically the seasonally strongest license revenue quarters for AspenTech, while the March and September quarters are seasonally weaker. In fiscal 2006, we had an unusually strong March quarter due to the positive impact of large deals. As we discussed at the time we announced the quarter and on last quarter's conference call. We currently anticipate total GAAP operating expenses of between 69 and $71 million in the fiscal third quarter, flat to down slightly compared taught second quarter. In the third quarter of a year ago period, total GAAP expenses were approximately $68.9 million.

We appreciate that many analysts still wish to back out non-cash charges and other expenses that are nonrecurring in nature in order to evaluate the ongoing performance of AspenTech. In the third quarter of this fiscal year, we expect to incur non-cash stock-based compensation expense of approximately $3.3 million, non-cash amortization of intangibles associated with previous acquisitions of $1.2 million, and restructuring charges and losses on sales of assets of 1.2 million. At the interest income line, we currently expect to receive the benefit of approximately $1.1 million associated with the accretion of retained interest in sold receivables. We currently anticipate fiscal third quarter diluted GAAP EPS of $0.08 to $.0.10 per share. The previously mentioned items are expected to have a net negative impact of $0.05 per share.

So in summary, our first half performance was better than we expected, and we believe we are on track with respect to our operating targets for the second half of the fiscal year. We believe the company is well positioned to deliver strong profitability and cash flow for the full fiscal year. With that, I'll turn it back to the operator to begin the Q&A session.

[OPERATOR INSTRUCTIONS] We'll pause for just a moment to compile the Q&A roster. The first question comes from the line much Richard Davis of Needham and Company.

Richard?

Hold on. Can you hear me? .

Richard?

Hold on. Can you hear me? .

We can now.

Can you hear me now? Okay. Is that better? .

That's better, yep.

All right.

We can't hear you again.

How about now? Can you hear me now?

We can.

Sorry about that. In any case, how far do you feel that you're in the roll out for aspenONE, with regard to, you know, chemicals, energy, and E&C? Is it 10%? Is it 15? I mean, you must have some rough estimate of that

Richard, we don't break it out that way. We're still 18 months really into this from the beginning of when we started to sell and market this in earnest, and the way we look at it is it's not worth calculating yet, where we are from a market share perspective in our customer base because it's so small. While we're doing well and pleased with the performance of it so far, from our perspective, it's still a virtual green field for us, and it's our intention to continue to execute on our sales line and to go out and talk to our customers, and as I mentioned, we are pleased with the performance of AspenONE so far. It did come in this quarter above what we expected for the long term trend, and I think it's fair to say that the traction on the solutions set is running a little bit ahead of our expectations. But, you know, we stick with our overall plan of 20 to 30% of our license revenue in any given quarter. But we are pleased with where we are so far, and we have lots of opportunity and a strong pipeline going forward.

With regard to the services side of our business, how do you feel you are relative to where you'd like to be in terms of -- I know you had put a lot of effort behind kind of moving up the value chain on that side of he equation, how does it feel for you there?

In services in general, I think it's meeting our expectations. When I first came to the Company, we said we were going to run our services business and improve our margins and run them in the high 40s, low 50s, which we've been doing on a consistent basis over the past 18 months or so. You know, the overall year-over-year revenue growth on the services line is something that, you know, while we say that it is a strategic business and it's not the primary driver of growth, we'd like all the parts of our business to grow. So clearly, and as we modeled it out for you last quarter, that we expected low to mid single digit growth on the services line. So I think as we see aspenONE licenses get -- start to become installed, as we get more traction with that, and as we start to turn our focus, you know, to all the different parts of our revenue lines, certainly we would like to see our services business, you know, start to grow and accelerate a little bit. That said, we do have a stated strategy of using partners to help us with the roll out of these applications and some of our partners are doing quite well in related services as it relates to aspenONE sales. So I think overall we're pleased with our services business. It's an important strategic part of our ability to roll out our licenses to our customers around the world, and while we'd like it to grow a little bit faster, I think in the longer term, in general we're pleased with it and we're glad we're operating it as efficiency and at the margin levels we are.

Great. Thanks very much. I'll let other people ask questions.

Thanks, Richard.

The next question comes from the line of Robert Schwartz with Jeffries.

Yes, gentlemen, it's flabbergasting both for the success of the products, as well as another restatement, so I'd like to address both of those. Were there any $10 million plus deals in the quarter, and how many, if so?

Yes, Rob, we never break out, you know, the size of the individual deals. You know, that's why we tried to give you a little bit of a metric in the prepared remarks. You know, this quarter was a strong quarter and clearly from the prepared remarks, you can see we had a number of deals that were larger than they were a year ago from overall size. So, you know, while we don't break them out on an individual basis, it was a strong quarter, I think it reflects the overall health of Aspen's business our customer's interest, and our point solutions, and our aspenONE solutions, and in general, I think the strengths of what we said in the past about our product line.

And how many of the top ten deals had aspenONE in them?

I would -- I believe it was of the top ten, it was about six of ten.

Good. I'm surprised that, given the huge, you know, license revenue, which is really remarkable, that selling and marketing expense is only up $1 million sequentially, and below, say, Q4, where you had $44 million of licenses. How do I reconcile that? Why wasn't selling and marketing expense up more this quarter?

Rob, there are a number of things that go into that, as you know. Not only the things that are probably obvious on the surface in way of the compensation that goes to our sales folks, but also the timing of various marketing initiatives, conferences, and the like. So it's really timing driven relative to some specific items, as well as I think you're surmising in your question, tied to revenue volume.

Okay. The restatements, we've had, I guess, '05 restated several times in '04. Help us understand how this relates to the material weaknesses you guys reported, and when do we see an end to this, and it seems to me that we've touched now on restatements on several different points, which must be frustrating for you as well. How do we come to some sort of conclusion on when we'll start getting consistent reports on a regular basis?

Well, I understand the question, Rob. I think a couple of things, and, you know, I understand the subtext as well. The -- if you look at the overall performance of the Company and the numbers that we're talking about, you know, the story is of a very strong healthy company. We had a very good quarter. Margins were good, cash flow were good, all of these things were well ahead of where we had guided and where we had planned. So I think that's point one is that that is the material story here. As you think about and as we think about some of the things that are giving rise to the restatements, we're talking about in this case, what I would describe as a computational error in the way that the foreign subsidiaries are brought in and consolidated into our total books. It's a non-cash item. If you think about, again, the last restatement, which itself was also computational in nature relative to the way forfeiture rates were calculated and that sort of thing, these are -- though they're unfortunate, they are a reality of the way that we are now tightening things down, we're in the process of making significant investments and upgrades in our IT infrastructure, and the people in our process, all of which are designed to create a scalable platform for growth as we go forward.

Okay. Any sense on the timing of when this might be done, in terms of having the -- the restatements?

As you probably saw, Rob, what we're talking about restating here is first fiscal quarter and the three annual years, of '04, '05, and '06, those being our fiscal years. We're working closely with our outside audit firm and with our audit committee to get that done just as quickly as we can. And when we have a date to announce, we'll be sure to do that.

Thanks so much, and congratulations on the revenue. That's quite remarkable.

Thanks. Next question?

The next question comes from the line of Phillip Alling of Bear Stearns.

My first question, were there any 10% customers in the quarter that you'd expect to identify in your Q for the quarter?

We typically break that out only on an annual basis, Phillip.

Is it your expectation that when you file the K, there would be any 10% customers in this quarter?

We typically don't talk about it in the quarter, just the 10% customers on an annual basis.

Okay. With respect to the increase that you had in the G&A line, you talked about an upgrade in IT infrastructure, and you just made comments with respect to the controls there. How should we be thinking about that expense line item going forward, and, you know, are there additional investments in IT infrastructure that we should be modeling going forward or were those one-time in nature, in terms of those investments?

Let me take that a couple of ways, if I could, Phillip. One is, from a specific guidance perspective, we tend to think of the Company in terms of our overall expense base, and as you heard in the prepared remarks, where we think we're going to be landing with that. We will be making investments over time in our IT systems, as well as other areas where we've been a little bit more descriptive in our 404 report. So we do expect to continue making investments there. Some of the other reasons that G&A is a little bit higher this quarter than you might have seen sequentially or relative to prior periods, you'll see not only the investments there, but also in the way of our incentive comp. So there is variability in the cost line relative to the top line, as well as, then, the ongoing legal and professional fees that we have relative to completing some of the things that have been overhanged with the Company.

The incentive comps down we might see in the G&A line as opposed to, say, sales and marketing?

It's in all lines, so, you know, you see it in the lines where the people that -- you know, their underlying salary hits that line so their incentive comp Would hit that line. So, for example, in this quarter, when we have to expense the stock options and the restricted stock, that goes to the line with the people who are in that compensation are.

Just -- and then to finish up on this -- the G&A line, was there any impact from an increase in legal expense for defense of prior management in this quarter and what provisions should we be thinking about as far as that on a going-forward basis?

Well, the -- you know, the legal fees that we're talking about here, we don't break those out specifically. There was nothing unusual as it relates to your specific question.

Okay.

Yes, Phil, on a go-forward basis, we'll break whatever we expect for legal fees for the company in general into the guidance that we give on an overall basis.

Is it your expectation that the Company is going to be incurring legal expense for defense of prior management, or is that something -- could you comment on that now?

Yes, we really can't comment specifically about what is going on as it relates to any of the prior management. You know, as you know from the Company chart, the Company does provide for indemnification of employees, but, you know, we have no further comment to make about it at this time.

Okay. Did want to just, with respect to comments that you made, as far as the long-term targeted growth, obviously, numbers that you've posted in the past two quarters have -- on a -- if you look it over, the six-month basis, have exceeded, you know, those targets. But have you made any change to what your long-term targeted growth expectations are from the sort of low double digit level, or is that really what you think investors should be thinking about longer term as an organic growth that you could achieve going forward?

Yes, as I said in the comments, we're very pleased with the performance at the half year of the Company, and, you know, the growth rates that we've seen in the top line and in the license line. We think it reflects well on the things that we're trying to do, you know, in operating and executing our plan for the fiscal year. As we think about the business, and as you know, we only give guidance on a one-quarter basis. And, you know, that's been the Company's policy since I've been here. You know, we have said in the past, you know, that we believe our organic growth and what we're trying to hit is in the lower double digit range, and at this time we're not really looking to update that or change, you know, our opinion. We have our operating plan. We operate the business on a quarterly basis for sure, but over a six-month and over a 12-month basis, and, you know, if we have an updated top-level guidance or any of the other operating metrics that we've talked about in the past, we'll certainly share with you.

Brad, Mark, thanks very much. That's what I have for now.

All right. Thanks, Phil.

Your next question comes from the line of Phil Rueppel with Wachovia.

Thanks, this is actually [Priya Gerstram] in for Phil. I have a couple of quick ones. I was wondering if you could talk about how the new software suite was perceived by customers, and also what are some of the new modules for new media that you're looking at expanding into, and also the [INAUDIBLE] and how they work.

We're having trouble hearing the question. I apologize for that. I think the question was about aspenONE and how the customers are receiving aspenONE. The second part of the question was again, please?

I'm sorry. Can you hear me better now?

Yes.

Okay. So, yes, the second one was [INAUDIBLE], if you've seen any changes, and then the first one was just how the new software suite was received by customers and what are some of the new modules you're looking into expanding this year.

In general, I think I'll take them in order here. In general, we're very pleased with how aspenONE has started to become a material part of our business. As I stated earlier, it is a little ahead of where we expected. We gave a long term target of somewhere between 20 and 30% of our overall license revenue on a quarterly basis, and we're clearly over the last couple of quarters, we've been running over that. So I think our customers are very pleased with the things that we're doing, the integration, and the new functionality they're getting in the modules that we're providing to them. And I would expect, given what we have for a look forward into the pipeline, that we'll continue to be successful.

As far as competitive environment, it continues to be in various cases, you know, competitive, certainly. We have large, well funded competitors in most of the major spaces that we compete. But as you know, Aspen does have the Number 1 market position in the process industries, and we have, you know, a very nice market position in engineering in the Number 1 position worldwide, and the supply chain is Number 1, and in the plant, we're a close -- close third or so. So we have a very strong market position, and as we bring these aspenONE integrated solutions to the market, we certainly have a common way that we look at the business now and a common way that we think about it, and that helps us with our sales across all of the suite. As far as the new modules go, we've very focused, as we've announced in the past on our inventory packet module in energy and on our ethylene scheduling module. You know, those are starting to get some nice uptick in interest from the major customers that we're targeting in that area. We're also looking, and we announced about six months ago, I guess, that we increased our sale support, technical sales support function for aspenONE modules by about 15 or so folks in the June, July time frame or so. We'll expect that we'll continue to invest in that area and build out our sales support team in this area, and maybe include some other areas going forward and related topics around all of it. So we're very pleased of where we're at with aspenONE. It is a competitive environment, but we think we're doing many of the right things to compete effectively in each one of the spaces. You know, we're bringing new solutions, new integration, new features and functions to the market, and we think it's being successfully sold and executed, and we believe we'll continue to be successful.

Great. Thank you.

[OPERATOR INSTRUCTIONS]

Okay. Thank you, operator. Thank you, everybody, for joining us on this afternoon's conference call, and we look forward to keeping in touch.

Thank you.

This concludes today's conference call. You may now disconnect.