CareCloud Inc (CCLD) 2018 Q3 法說會逐字稿

Good morning, and welcome to the MTBC Third Quarter 2018 Earnings Conference Call.

(Operator Instructions)

Please note this event is being recorded.

I would now like to turn the conference over to Kim Grant, Associate General Counsel.

Please go ahead.

Good morning, everyone.

Welcome to the MTBC 2018 Third Quarter Conference Call.

On today's call are Mahmud Haq, our Founder and Executive Chairman; Stephen Snyder, our Chief Executive Officer and a Director; A. Hadi Chaudhry, our President; and Bill Korn, our Chief Financial Officer.

Before we begin, I would like to remind you that certain statements made during this conference call are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.

All statements other than statements of historical fact made during this conference call are forward-looking statements, including, without limitation, statements regarding our expectations and guidance for future financial and operational performance, expected growth, business outlook, and potential organic growth and acquisition, including any discussions regarding the details and closing of Orion and other acquisition opportunities.

Forward-looking statements may sometimes be identified with words such as will, may, expect, plan, anticipate, upcoming, believe, estimates, or similar terminology and the negative of these terms.

Forward-looking statements are not promises or guarantees of future performance and are subject to a variety of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those contemplated in these forward-looking statements.

These statements reflect our opinions only as of the date of this presentation, and we undertake no obligation to revise these forward-looking statements in light of new information or future events.

Please refer to our press release and our reports filed with the Securities and Exchange Commission, where you will find a more comprehensive discussion of our performance and factors that could cause actual results to differ materially from these forward-looking statements.

Finally, on today's call we may refer to certain non-GAAP financial measures.

Please refer to today's press release announcing our third quarter 2018 results for a reconciliation of these non-GAAP performance measures to our GAAP financial results.

With that said, I'll now turn the call over to our Chief Executive Officer of MTBC.

Steve?

Thank you, Kim, and thank you, everyone, for joining us on our third quarter 2018 earnings call.

We are pleased to report a strong quarter of record revenue and cash from operations.

Our revenue for the third quarter was $17 million, which represents nearly a doubling of our revenue as compared to the prior quarter.

Likewise, during the third quarter, we generated $2.8 million in cash from operations, a record for us, while positioning us to approximately double our adjusted EBITDA for full year 2018.

In addition to reporting the strongest quarter in our history, we are pleased to now have more than $20 million in cash and available credit to support our growth initiatives.

With regard to our focus on growing through acquisitions, let's discuss our most recent transaction in order to explore the broader strategy.

In July, we acquired substantially all of the assets of multiple affiliated companies, which we collectively refer to as Orion.

Orion was an aggregator in our space, and we purchased its assets through a bankruptcy proceeding.

Orion was an attractive opportunity for a value buyer like MTBC.

We paid $12.6 million in cash to acquire Orion's customer contracts, which we expect to generate approximately $30 million on an annualized basis.

We also acquired their accounts receivable, furniture, equipment and certain other assets.

In addition to helping us scale, this acquisition further rounded out our service offering and allowed us to onboard additional talented team members who will help us grow during 2019 and beyond.

Since companies with Orion's revenue mix and size often sell for 1 to 2x annual revenues, we were pleased to have paid less than 0.5x revenues.

The seller indicates that 28 other potential acquirers signed nondisclosure agreements and performed due diligence on Orion.

This list of 28 is a veritable who's who list of the most active and well-financed acquirers in our space, representing a cross-section of financial buyers with industry experience and experienced strategic buyers, some with proprietary technology and large global workforces.

Even though Orion was a great opportunity, ultimately, there were very few companies like MTBC that had the capacity to unlock Orion's value.

In fact, at the end of the day, 27 of the 28 suitors passed on Orion, and the one other suitor who had a preexisting relationship with Orion faded quickly during the auction process.

So it's natural to ask why the other 27 did not ultimately compete for Orion.

We believe the answer lies in the challenges inherent in a deal like Orion, and we believe that our differentiated approach will continue to open opportunities like Orion for us in the future.

First, succeeding in such a transaction requires a disciplined yet quick pace and cost-efficient approach to operational, financial and legal due diligence and integration planning.

We believe that our in-house team of accountants, lawyers, and operational leaders, strategically supported by outside experts as needed, is unmatched in their experience with regard to the type of transactions we pursue.

Second, in these acquisition scenarios, an acquirer needs both the operational experience and the scale to successfully integrate the acquired operations in a way that adds value and expands margins.

We have the scale, with more than 2,000 team members worldwide, and the expertise, having, to our knowledge, acquired more companies in our space over the last 5 years than anyone else.

This experience has allowed us to hone and refine our processes in a way that gives us a unique ability to succeed in spite of the inherent challenges.

Moreover, our approach allows us to segment the workflow in a way designed to ensure that each part of the process is handled by the team, technological component or process that adds the most value at the lowest price point.

Third, to be successful, a buyer needs a technological expertise to address the unmet needs of the client base and streamline operational workflows while at the same time reducing operating costs.

We've developed one of the most comprehensive proprietary platforms in the industry.

We have extensive experience working with other platforms, and we have a team of more than 300 IT and R&D professionals.

This technological expertise is a critical differentiator and a key to our success.

We believe that we are uniquely situated to succeed in these types of transactions.

And let me share with you, if I may, the latest regarding the actual integration of Orion to date.

With regard to expense reductions, we have reduced service costs associated with third-party vendors by more than 65%.

We've also renegotiated facility leases, consolidated locations and otherwise taken steps to reduce our facility expenses by more than 35%.

Moreover, we've rationalized other operating costs while leveraging our core team members who bring additional expertise.

When we view these initial reductions in operating costs in the context of our strong client retention, we expect to materially expand our margins during the quarters to come.

In addition, we've added talented team members through the acquisition who will play key roles as we continue to grow during 2019 and beyond.

With that said, I'll turn the floor over to our President.

Hadi?

Thank you, Steve, and thank you, everyone, for joining us on our third quarter 2018 call.

With our most recent acquisition, we have also broadened our service offering.

We believe that as the health care market continues to become more complex, physicians increasingly need a comprehensive turnkey solution, and ours is among the most comprehensive in the industry.

For an ambulatory practice that leverages our entire scope of services, we provide the following technology-enabled services: cloud-based practice management with real-time insurance eligibility; online scheduling; secure patient communication; and business analytics; technology-based and LifeStation support; cloud-based electronic health records that digitize and enhance physicians' charting while connecting the practice to the broader health care community; mobile health apps; insurance credentialing designed to ensure that each provider is properly contracted with insurance payers; coding, which enables providers to receive optimized reimbursement (inaudible) compliance with; insurance name scrubbing, utilizing our proprietary rules; claim submission and follow-up oriented towards effectuating proper payment, all of which is commonly called revenue cycle management; and group purchasing discounts on leading vaccines and other supplies from top pharmaceutical manufacturers.

Most of the industry is comprised of vendors that either provide technology solutions such as electronic health record applications or provide standalone revenue cycle management.

We provide both in a fully integrated solution.

We also interface with third-party applications.

We believe that this is an important differentiator and will support our continued growth.

Separately as a result of our Orion acquisition, we now provide additional niche hospital solutions such as Medicaid and charity care eligibility services.

Additionally, we now manage multiple physician offices under long-term physician practice management agreements.

In summary, we now have an even stronger and broader service offering.

We intend to leverage this trend, and we focus on continuing our high revenue and adjusted EBITDA growth into 2019 and beyond.

In addition to further enhancing voice recognition and AI functionality in our talkEHR, we have started to develop and incorporate telehealth capability in our talkEHR and mobile app.

By using our mobile app or a PC, patients will be able to book and have a telehealth session with a doctor using our talkEHR.

We have also completed development of our first blockchain-based interoperability solution with First EHR vendor.

It is currently being tested, and we anticipate this to be in production this quarter.

We are also actively working on exploring other opportunities in the industry where we can connect with other blockchain-based solution providers in the health care industry, including clearinghouses.

I'll now turn the floor over to our Chief Financial Officer.

Bill?

Thank you, Hadi.

Revenues for the third quarter 2018 were $17 million, an increase of 127% or $9.5 million compared to $7.5 million in the same period last year and an increase of 96% compared to the second quarter.

Not only was this a new record, but it was the largest percent increase of any quarter in MTBC's history, fueled by the Orion acquisition.

In addition to doubling the company size, the Orion acquisition added several additional service offerings to MTBC's portfolio.

During the third quarter, we generated $3.3 million of revenue from practice management services.

We now manage pediatric practices in Ohio and Illinois through multi-decade management service agreements.

We employ nurses, medical assistants, receptionists, practice managers and other practice personnel in 5 locations.

We share patient revenue with physicians in these practices and exclude the physician portion from the revenue we report.

We also now manage a group purchasing organization, enabling 4,000 physicians across the country to purchase vaccines from leading pharmaceutical companies at discounted rates.

During the quarter, we generated $477,000 of revenue from this GPO.

Physicians purchase vaccines directly from Merck and Sanofi-Pasteur and we receive rebate checks from the pharmaceutical manufacturers.

Physicians can learn more about our GPO and enroll for free to start saving up to 20% on vaccine purchases at www.mtbc.com/GPO.

Third quarter 2018's GAAP net loss was $1.8 million compared to a net loss of $980,000 in the same period last year.

Similar to our previous acquisitions, from an accounting perspective, a large portion of the purchase price will be attributed to intangible assets, most of which we will amortize over the next few years.

This means that our noncash amortization expense has increased, which always happens with an acquisition.

Amortization is excluded from non-GAAP financial measures, but because of it, we expect to report a GAAP net loss for the next few quarters before returning positive as we were during the first and second quarter of this year.

The GAAP net loss for the third quarter is $0.25 per share, a smaller loss than expected, calculating the net loss attributable to common shareholders divided by the weighted average number of common shares outstanding.

Net loss attributable to common shareholders takes into account the value of the preferred stock dividend declared during the quarter.

Our non-GAAP adjusted net income for the quarter was $507,000, an increase of $826,000 compared to third quarter last year, and was the company's fourth consecutive quarter of positive adjusted net income.

Non-GAAP adjusted net income was $0.04 per share, calculated using the end-of-period common shares outstanding.

The Orion transaction has helped us to significantly scale our business, enabling us to grow revenues without a corresponding increase in overhead.

Adjusted EBITDA for the third quarter 2018 was $865,000 or 5.1% of revenue compared to adjusted EBITDA of $609,000 in the same period last year.

This represents an important achievement for MTBC, since we were able to grow quarterly adjusted EBITDA year-over-year, notwithstanding the investments we made in integrating Orion.

Those are temporary operational redundancies to support a smooth transition.

Three factors made this possible.

First, our core business remained profitable.

Second, Orion's practice management business and group purchasing organization were both contributing to profitability.

Third, our team moved quickly and effectively with Orion's revenue cycle management business, replacing subcontractors and reducing costs.

Our overall adjusted EBITDA was a remarkable $865,000 for the quarter.

Cash flow from operations for the quarter was $2.8 million, in part reflecting the advantageous turns of the Orion acquisition, where we were able to retain accounts receivable but did not assume most accounts payable.

Since MTBC had sufficient cash to complete the Orion acquisition, doubling our company's size, without issuing any additional common stock or incurring any debt.

And we immediately generated positive cash from operations, this transaction was accretive for our shareholders from day one.

This was an exceptional transaction.

Turning to the year-to-date results, revenues for the first 9 months of 2018 were $34 million, an increase of 45%, or $10.5 million, compared to $23.5 million in the same period last year.

Revenue for this 9-month period was larger than for any full year in the company's history.

For the first 9 months of 2018 the GAAP net loss was $1.6 million, an improvement of $3.8 million from the first 9 months of 2017.

We were effective at improving profitability from the business we acquired from MediGain in October of 2016.

MTBC reported positive GAAP net income and positive GAAP operating income during the first 2 quarters of 2018, and we've started a similar effort to reduce the operating expenses associated with the Orion acquisition.

Non-GAAP adjusted net income for the first 9 months was $2.5 million, an increase of $3.7 million compared to the same period last year.

Non-GAAP adjusted net income was $0.21 per share.

Adjusted EBITDA for the first 9 months of 2018 was $3.4 million for 10% of revenue, compared to adjusted EBITDA of $763,000, or 3.2% of revenue, in the same period of last year.

As of September 30, 2018, the company had $1.3 million in cash and positive working capital of approximately $5.6 million.

We have an untapped revolving credit facility with Silicon Valley Bank, where borrowings are based on 200% of repeatable revenue adjusted by an annualized attrition rate.

During September this line of credit was doubled in size, to $10 million.

The SVB line could be used for future growth initiatives, including acquisitions, with SVB's approval.

We also raised net proceeds of $13.4 million from the sale of 600,000 additional shares of our nonconvertible Series A preferred stock via a public offering during the first 2 weeks of October.

The preferred shares trade on the Nasdaq Capital Market under the ticker MTBCP and pay monthly cash dividends at the rate of 11% per year.

From a CFO or an investor's viewpoint, our preferred stock gives us a tremendous advantage.

It does not dilute common stockholders, has no restrictive covenants like those which have gotten lots of industry participants into trouble, and is perpetual, with no mandatory redemption, although we have the right to redeem shares at $25 per share starting in November 2020 if we choose to.

How many other forms of financing do you know of where you have the flexibility to redeem it whenever you want, or easily tap into it further, as we have over the last 2 years, without any convertibility or dilution?

October was our largest offering of Series A preferred stock, and, as with previous offerings in 2017 and 2018, demand was so large that it was oversubscribed.

MTBC already had $5.6 million of working capital and a $10 million untapped line of credit and positive cash flows, the additional capital was solely to position us to be ready to take advantage of the opportunities we see for consolidation in the market.

With revenues of $34 million for the first 9 months of 2018, we are happy to reaffirm our guidance for full year 2018 revenue of $49 million to $50 million, which represents growth of approximately 50% over 2017 revenue.

We are also reaffirming that our adjusted EBITDA will be $4 million to $5 million for the full year, after achieving $3.4 million of adjusted EBITDA during the first 9 months.

Now that we're confident we can achieve 50% growth in revenue and 100% growth in adjusted EBITDA in 2018, in part due to a great acquisition, we've set our sights on doing something similar in 2019.

At the start of this year we never could have predicted that we would be able to double our revenues without selling a single additional share of common stock or taking on one dollar of debt.

We can't predict what the next 14 months will bring, but rest assured since the management team owns 50% of our shares we are just as focused on growth and profitability as we were when we found MediGain and Orion.

I'll now turn the floor over to Mahmud for his concluding comments.

Thank you, Bill.

We had a remarkable year so far, and we are ready for a year of record-breaking growth and continued profitability.

We thank our investors, customers, and employees for their support.

We will now open the call to questions.

Operator?

(Operator Instructions)

The first question will come from Kevin Dede, with H.C. Wainwright.

You guys issued press late October regarding an addition to the GPO, and I'm wondering 2 things on that, one, if you can offer more detail, and two, can you talk about how well your entrenched positions, the ones already on MTBC's revenue cycle management program, have adopted the GPO platform.

Thanks for an excellent question, Kevin.

With regard to the GPO, as a quick recap, we have about 4,000 providers practicing in primary care who are part of that GPO.

And through the GPO we've negotiated discounts with 3 of the top pharmaceutical companies that provide then in turn discounts to our members.

We added another pharmaceutical manufacturer, as you reference, Kevin, in October to that list, and we have some of the details.

If you go to MTBC.com/GPO you'll see the member that was most recently added.

When we look at it from a revenue perspective, the GPO generates about $1.2 million, roughly, in annualized revenue.

But where we really see the opportunity is exactly where you alluded to, which is being able to cross-sell between the GPO and the RCM base.

We've started the first phase of that, and what we've done is we've now created a web-based online automated process for signing up members of our RCM group, which we just launched and it's been well received within our client base over the last week, so moving from a kind of a human-based, more labor-intensive process of enrolling new members to one that's automated.

So that's a huge step, and we just launched that over the last week, and it's been very well received.

And the second phase of this will be going to our GPO customer base, those 4,000 physicians, and cross-selling our RCM and other solutions into that base.

And just to kind of illustrate the reason why we're so excited about that is for every one provider who moves from being simply a GPO customer to a GPO plus RCM customer, we believe we'll be able to increase the revenue for that provider by roughly 40 times.

So there's a significant upside associated with that.

Wow.

Okay, Steve.

So what you're saying is that by -- you're talking about your revenue, right, the revenue that you're able to recognize from that -- from one of the 4,000 preexisting GPO customers in that group?

Correct.

That's what you're alluding to?

That's what we're alluding to, yes.

Absolutely.

Yes, no, next question real quickly you took pains to make it clear how MTBC's scale was able to accept all the additional Orion business without incurring huge costs.

And given some of the comments also made on the call with targets on trying to continue to grow the business, I'm wondering if you can talk to how stretched your internal, I guess, your internal foundation is, your internal workings.

Can you speak to the amount of pressure that you're feeling internally in order to make these huge operational changes that you've made on the incoming business versus straining the relationships that you have, that you already had?

Certainly.

Yes, and then talk a little bit to how you see that integration driving margin improvement more specifically.

I mean, you sort of left it open-ended, and I appreciate that, but if you look at -- if you look at past quarters, your gross margin was running in the high 40s to over 50% even in June.

And I'm just curious on how far or how long it might take you to navigate back to that area.

Absolutely.

So, I'll address the first part of that question, and then Bill can jump in in terms of the margin expansion.

With regard to the first question, in terms of the internal stress, we really have the benefit of having done this many times over the last 5 years.

In fact, I think it's accurate to say that we've closed more of these types of transactions in this space than any other player in the market during the last 5 years.

So that has given us the ability, candidly, to build a team that has really been able in a very disciplined, methodical way to be able to integrate companies like this, even companies of this size.

So we feel great about where we're at in terms of that integration.

Candidly, it's exceeding our internal expectations.

And our excitement now is really about the next acquisition.

That's where our energies are really largely focused, on identifying the best next fit to acquire.

So from the perspective of the internal kind of components of this, we feel great about where we're at, on track, both with regard to cost cutting and retention.

And I'll let Bill jump in with regard to the margin expansion.

Thanks, Steve.

And, Kevin, good question on margin expansion.

I think if you look at our acquisition of MediGain, we went through 6 months of integrating the business before we turned and deposited EBITDA.

And then it really took us another 3 to 6 months before we were able to get to good, solid, positive EBITDA margins.

In this case, obviously, we stayed positive immediately, and in some respects the practice management business and the group purchasing organization really helped us, because those pieces were already positive.

Having said that, those pieces won't show as big an improvement.

So, while I do think we'll get ourselves back to a 50% EBITDA margin, that'll probably take us a year to do.

I do expect to see significant margin improvement over the next 1 or 2 quarters, however, again, as we continue to pursue this very quickly and aggressively.

Again, with the experience every time you do this it gets a little bit easier.

The next question will come from Brian Marckx of Zacks Investment Research.

Can you disclose how much of the RCM revenue in Q3 was directly related to the Orion addition?

So, thanks, Brian.

We typically don't disclose how much has come from each piece.

But, again, you could think about the fact that in the first half of the year we had $17 million of revenue.

So if you think about $17 million in the first half, round numbers, $8.5 million a quarter, and then you say I got $17 million of revenue this quarter, roughly half the total revenue came from Orion.

And, again, I think we mentioned the $3.3 million of practice management and the $470,000 of GPO.

The rest of the Orion business -- the rest of the revenue during the quarter was all RCM.

Okay.

And then in terms of integration and acquisition costs that would be somewhat one-time characterized and would be potentially just captured in Q3, is there a number that you can give us of the acquisition and integration costs that would not repeat after Q3?

When you look at the table that shows the adjusted EBITDA you'll see a number for integration and transaction costs in that table.

And most of that is one-time for us.

Some of that relates to the actual acquisition transaction.

Some of it relates to the integration of the business.

There'll probably be a small amount in there during Q4 and even into the beginning of next year, for example, if we need to pay to get out of a lease early or if we need to do some other one-time severance or other costs.

But some of what's in there even is as we worked on migrating off of subcontractors, when you're using the subcontractor and you're also paying your employees, that's regular cost.

That doesn't get excluded.

So you'll see some of that.

You'll see a few hundred thousand dollars of that that will go away because we no longer use those subcontractors.

But in addition we structured an arrangement with a large-scale contractor where we put some money in escrow so that at the end of a successful integration they would get a pot of gold at the end of the rainbow.

That kind of money goes into the integration and transaction costs and would not repeat.

Okay.

And then in terms of potential additional acquisitions, is there anything specifically on your radar?

I don't expect that you'll be able to necessarily talk about specifics, but is there anything that's on your radar that you think is at least of reasonable probability that you would pull the trigger on here in the next, say, 6 to 9 months?

A great question, and I think you probably alluded to our answer in the question itself.

So certainly we're focused on identifying the right next acquisition.

And you're right, we'll disclose that when we've identified that and there's reasonable certainty around that.

But I think if we step back for a minute and we think about where we are at right now, we've never been better positioned to move forward on the right acquisition opportunity.

And we're committed to continuing to employ our very disciplined approach, which has served us very well in terms of identifying the right target and negotiating optimal terms.

Over the last couple months we've been in ongoing conversations with key investment bankers and intermediaries, industry players, executives.

And it's from this group that we will most likely be able to source the very best opportunities.

So we're excited about where we are at.

Again, more capital than we've ever had in the past to be able to invest in our growth initiatives.

And clearly as soon as we're at that stage where we have a target at that point we'll announce that.

The next question will come [Pranab Kumar of Exalta].

I would like for the management to elaborate a little bit on the Salus partnership and explain to us how it will be beneficial in the long run.

Thanks for your question.

So, Salus is an example of many of the similar types of relationships we have with other industry players.

Other companies work with our target market.

Salus provides a specific type of telemedicine that's primarily focused on larger groups in hospital settings.

And it's across referral relationship.

So the way in which we'll benefit from our relationship with Salus or from many of the other partners we work with is by being able to share leads with each other and then being able to support each other in closing those leads.

And when those leads are then closed there's oftentimes in these relationships there's a referral fee that's paid.

So there's an incentive that's baked into these relationships to be able to help each other grow.

And that's the gist of the Salus relationship.

(Operator Instructions)

The next question is a follow-up from Kevin Dede, of H.C. Wainwright.

Hadi, you went back to talk about the blockchain development, and I'm wondering I you can offer a little more color on that one group of physicians that you have working with you and some of the, I guess maybe just some anecdotes to give us some flavor for how that's developing and whether or not you think you've shown up on other players' radar.

Thank you.

Thank you, Kevin.

We have completed the development for the integration of that one, the first vendor with our blockchain network, and we have given the press, in the press release the details of that first relationship.

And it is currently being thoroughly tested, and tweaks are being made as we are working through communicating between the 2 EHR systems.

And we anticipate this to be in production within this quarter.

And at the same time we are in discussions with at least one other vendor and exploring other possible opportunities with vendors providing blockchain solutions, even including the clearinghouses.

Do you have -- I mean, do you enough visibility, Hadi, to give us an indication of when you think you might be able to talk about how, I mean, how it's growing?

I know it's very, very early days.

I'm just wondering, I mean, your crystal ball is much clearer than ours, and I was just hoping you'd give us a little insight on how you see it growing and maybe what the perception is from outside.

And given that other people have tried to do this unsuccessfully, I'm just kind of curious to see if you think your initial steps are more successful.

Even in, as you mentioned even in your question, it's an initiative, and we believe this could become one of the solutions for the industry for interoperability and transmitting the healthcare information between the different systems in much secure way.

We are -- we just actually even recently attended one of our member they did blockchain in healthcare conference in Tennessee over the last 2 days, as well, and there have been many vendors talking about it and trying to find the different opportunities or the possible things that can be done in the industry that you can drive toward one final solution or some possible solutions in this industry.

So it will be, I think, premature to say what the final shape would look like.

But for sure many vendors have started to talk about it.

The industry has started to look at it as one of the possible solutions in this space.

It will get -- it will be concluded towards one more meaningful solution for the interoperability.

Okay, Hadi.

Fair enough.

Bill, could you give us the figure for the preferred share count I guess at the end of the quarter and post deal?

Sure.

So we've -- at this point we've got about $53 million worth of preferred outstanding.

That's as of today.

And I think we mentioned that in October we had sold $15 million worth, $15 million gross, which was 600,000 shares.

So therefore we had $38 million worth of preferred outstanding at the end of September.

And so the question that you didn't ask, the $53 million in preferred, our dividends are $490,000 a month.

When you think about our Q3 cash flow, our cash flow in the quarter was $2.8 million, which was $1 million more than our Q4 level of dividends.

So we're already generating enough cash flow to easily pay those dividends and have money left for reinvestment.

Okay.

See, you sold 600 shares, so what was the -- what's the total now, the total count?

So, the total count is 2,136,000.

Okay.

And all told on that 2,136,000, the monthly dividend is almost $500,000?

That's correct, $490,000 a month.

We've paid our monthly dividends now every month for over 3 years, and we're really excited about the tremendous advantage that we get being able to do the financing that way, without needing to dilute our shareholders.

Right.

Okay, so you doubled the SVB line, and that's at $10 million.

That stands now.

How long would it take them to get that cash to you?

Just give us a scenario where you identify, you and Steve and the team identify a target.

How long can you, or how long would it take you to pull the trigger on it?

It's a revolver, so a few seconds, maybe half a minute if the internet's running really slow between New Jersey and California.

And this concludes our question-and-answer session.

I would now like to turn the conference back over to Kim Grant for any closing remarks.

We'd just like to thank everybody who's joined us for this call.

We thank you all for your questions.

And we wish you all a great day.

The conference has now concluded.

Thank you for attending today's presentation.

You may now disconnect your lines.

Have a great day.