Climb Global Solutions Inc (CLMB) 2024 Q1 法說會逐字稿

Good morning, everyone, and thank you for participating in today's conference call to discuss Climb Global Solutions' financial results for the first quarter ended March 31, 2024. Joining us today are Climb's CEO., Mr. Dale Foster; the Company's CFO, Mr. Andrew Clark; and the Company's Investor Relations Advisor, Mr. Sean Mansouri with elevate IR. By now everyone should have access to the first quarter 2024 earnings press release, which was issued yesterday afternoon at approximately 4:05 PM Eastern time.

大家早安，感謝大家參加今天的電話會議，討論 Climb Global Solutions 截至 2024 年 3 月 31 日的第一季度財務業績。公司首席財務官安德魯克拉克先生；以及公司投資者關係顧問 Sean Mansouri 先生與 elevate IR。現在，每個人都應該可以訪問 2024 年第一季收益新聞稿，該新聞稿於東部時間昨天下午 4 點左右發布。

The release is available in the Investor Relations section of climate Global Solutions' website at www.climbglobalsolutions.com. We'll will also be available for webcast replay on the company's website. Following management remarks, we will open the call for your questions.

新聞稿可在氣候全球解決方案網站 www.climbglobalsolutions.com 的投資者關係部分取得。我們也將在公司網站上提供網路廣播重播。在管理層發表講話後，我們將開始電話詢問您的問題。

I'd now like to turn the call over to Mr. Mansouri for introductory comments.

我現在想將電話轉給曼蘇裡先生，請其介紹性評論。

Thank you. Before I introduce Dayle, I'd like to remind listeners that certain comments made on this conference call and webcast are considered forward-looking statements under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to certain known and unknown risks and uncertainties as well as assumptions that could cause actual results to differ materially from those reflected in these forward-looking statements.

謝謝。在介紹Dayle 之前，我想提醒聽眾，根據1995 年《私人證券訴訟改革法案》，本次電話會議和網路廣播中的某些評論被視為前瞻性陳述。未知的因素的影響。

These forward-looking statements are also subject to other risks and uncertainties that are described from time to time in the Company's filings with the SEC do not place undue reliance on any forward looking statements which are being made only as of the date of this call. Except as required by law, the Company undertakes no obligation to revise or publicly release the results of any revision to any forward-looking statements.

這些前瞻性陳述也受到本公司不時向美國證券交易委員會提交的文件中所述的其他風險和不確定性的影響，請勿過度依賴僅截至本次電話會議之日做出的任何前瞻性陳述。除法律要求外，本公司不承擔修改或公開發布任何前瞻性陳述的任何修改結果的義務。

In our presentation also includes certain non-GAAP financial measures, including adjusted gross billings, adjusted EBITDA, adjusted net income and EPS and effective margin as supplemental measures of performance of our business, All non-GAAP measures have been reconciled to the most directly comparable GAAP measures in accordance with SEC rules. You'll find reconciliation charts and other important information in the earnings press release and Form eight K we furnished to the SEC yesterday.

我們的簡報中還包括某些非GAAP 財務指標，包括調整後的總帳單、調整後的EBITDA、調整後的淨利潤和每股盈餘以及有效利潤率，作為我們業務業績的補充指標。 GAAP 指標均已與最直接可比較的指標進行了調整GAAP 措施按照 SEC 規則進行。您可以在我們昨天向 SEC 提供的收益新聞稿和 8 K 表格中找到調節表和其他重要資訊。

With that, I'll turn the call over to climb CEO. Dale Foster.

就這樣，我將轉交晉升執行長的電話。戴爾·福斯特.

Thanks, Sean, and good morning, everyone. We continue to make progress in growing climate, strengthening our customer and vendor relationships in the first quarter as we produced double digit organic growth in North America, and we benefited from our recent acquisition of Data Solutions in Europe. Although we generated top solid top line growth, we experienced softer volumes across the key few vendors, primarily related to our timing with the timing with respect to their sales cycles does include the key vendor from our acquisition of Data Solutions in October 2023. While this adversely affected our bottom line in Q1, we expect to return to growth with these vendors over the back half of the year.

謝謝肖恩，大家早安。我們在不斷增長的氣候中繼續取得進展，在第一季度加強了我們的客戶和供應商關係，因為我們在北美實現了兩位數的有機成長，並且我們從最近在歐洲收購 Data Solutions 中受益。儘管我們實現了最穩健的營收成長，但我們在少數幾個關鍵供應商中經歷了銷售疲軟，這主要與我們與銷售週期相關的時間表有關，確實包括我們在2023 年10 月收購Data Solutions 時的主要供應商。

As many of you are aware, our acquisition of Data Solutions, broad deep network of relationships decline as well as a robust recurring revenue base with more than 90% of its fiscal 2022 revenue coming from existing reseller partners. We've already begun to take advantage of cross-selling opportunities between Climb US and Climb AMEA teams. For example, we signed global agreements with Gilenya solar winds and Suzette to name a few. Although these synergies are still in the early stages, we expect to uncover additional cross-selling opportunities as well as drive further operating efficiencies as we continue to integrate data solutions into our global operations.

正如你們許多人所知，我們對 Data Solutions 的收購、廣泛而深入的關係網絡以及強勁的經常性收入基礎都在下降，2022 財年 90% 以上的收入來自現有的經銷商合作夥伴。我們已經開始利用 Climb US 和 Climb AMEA 團隊之間的交叉銷售機會。例如，我們與 Gilenya Solar Winds 和 Suzette 等公司簽署了全球協議。儘管這些協同效應仍處於早期階段，但隨著我們繼續將數據解決方案整合到我們的全球營運中，我們預計會發現更多交叉銷售機會並進一步提高營運效率。

During the quarter, we deepen current partnerships with both signing new marquee vendors to our line card. We evaluated 32 vendors and signed agreements with only four of them demonstrating our commitment to participating and partnering with the most innovative cutting-edge technologies in the market.

在本季度，我們深化了與兩家新的大型供應商的現有合作夥伴關係。我們評估了 32 家供應商，僅與其中四家簽署了協議，這表明我們致力於參與市場上最具創新性的尖端技術並與之合作。

For example, in Q1, we expanded our partnership with Jamf. They are a leading provider of Apple device management and security software that enables businesses to efficiently manage and secure their Apple devices, insurance, seamless integration, enhance productivity and streamline workflows. Initially, we partnered with Janssen to launch their products in Canada, but based off the solid initial results, we reevaluated the scope to expand distribution in the United States, demonstrating our ability to successfully launch products and offer additional geographic exposure through our network of resellers. As we've often said in the past, we strive to build long-standing meaningful relationships with our partners.

例如，在第一季度，我們擴大了與 Jamf 的合作關係。他們是 Apple 裝置管理和安全軟體的領先供應商，使企業能夠高效管理和保護其 Apple 裝置、保險、無縫整合、提高生產力並簡化工作流程。最初，我們與楊森合作在加拿大推出他們的產品，但基於堅實的初步結果，我們重新評估了在美國擴大分銷的範圍，展示了我們成功推出產品並透過我們的經銷商網路提供額外地理曝光的能力。正如我們過去常說的那樣，我們努力與合作夥伴建立長期有意義的關係。

As a result, we are seeing increased exposure from targeted media coverage and industry interviews with our global teams. In addition to receiving several notable recognitions from key vendor partners in the first quarter, client was awarded distributor or Partner of the Year by numerous vendors, including Gilenya without a Trend Micro logic gate to make it to name a few. These awards are an affirmation of our strategic direction and speak to our approach to a limited line card. So that we can focus in going deeper with our vendor partners and truly add value to their sales efforts.

因此，我們看到有針對性的媒體報告和對我們全球團隊的行業採訪的曝光度有所增加。除了在第一季獲得主要供應商合作夥伴的多項顯著認可外，客戶還被眾多供應商授予年度分銷商或合作夥伴獎，其中包括沒有趨勢科技邏輯門的 Gilenya 等。這些獎項是對我們策略方向的肯定，也反映了我們對有限線路卡的態度。這樣我們就可以專注於與供應商合作夥伴進行更深入的合作，並真正為他們的銷售工作增加價值。

We are excited to build upon the strong growth we have achieved together looking to the remainder of 2024, we have a solid foundation to place in place to continue driving organic growth with existing vendors while signing new market-leading technologies to our line card. We expect to uncover additional synergies and cross-selling opportunities as we further integrate data solutions onto our operating platforms. Our ERP implementation is also on track to go live.

我們很高興能夠在我們共同實現的強勁增長的基礎上繼續發展，展望2024 年剩餘時間，我們擁有堅實的基礎，可以繼續推動現有供應商的有機增長，同時為我們的產品線簽署新的市場領先技術。隨著我們進一步將數據解決方案整合到我們的營運平台上，我們預計會發現更多的協同效應和交叉銷售機會。我們的 ERP 實施也有望上線。

This summer, and this will enable us to drive further operating efficiencies through our global operations. We will continue to leverage our strong liquidity position to explore new acquisitions that will enhance our offerings and expand our presence in both domestic and international markets. We believe the combination of these initiatives will lead to another yet another year of record growth and profitability.

今年夏天，這將使我們能夠透過全球營運進一步提高營運效率。我們將繼續利用我們強大的流動性狀況探索新的收購，以增強我們的產品並擴大我們在國內和國際市場的影響力。我們相信，這些舉措的結合將帶來另一個創紀錄的成長和獲利能力的一年。

With that I will turn the call over to our CFO, Drew Clark. I hope he will take you through the financial results. Thank you, Drew.

接下來，我會將電話轉給我們的財務長德魯·克拉克 (Drew Clark)。我希望他能帶您了解財務表現。謝謝你，德魯。

Thank you, Dale. Good morning, everyone. Quick reminder as we review the financial results for our first quarter, all comparisons and the variance commentary refer to the prior year quarter unless otherwise specified.

謝謝你，戴爾。大家早安。快速提醒，當我們回顧第一季的財務表現時，除非另有說明，否則所有比較和差異評論均指去年同期。

Before we jump into the results, let me reiterate Dave's comments that our positive outlook for the balance of 2024 and beyond. Despite the low expectation operating results for the first quarter as reported in our earnings press release, adjusted gross billings, or AGB, which is a non-GAAP measure, increased to 16%, which is $355.3 million for the quarter compared to $306.7 million in the year ago quarter.

在我們討論結果之前，讓我重申戴夫的評論，即我們對 2024 年及以後的前景持樂觀態度。儘管我們的收益新聞稿中報告了第一季的營運表現預期較低，但調整後的總營業額(AGB)（一種非GAAP 衡量標準）仍增加至16%，即本季的3.553 億美元，而上一季的調整後總營收為3.067 億美元。

Net sales in the first quarter of 2024 increased 9% to $92.4 million compared to $85 million, which primarily reflects organic growth from new and existing vendors, as well as the contribution for our acquisition of Data Solutions in October of last year. Again, as we've previously stated, we focus on AGB has the true metric of our top line growth as the calculation of net sales is influenced by product mix and the respective adjustments to convert AGB to net sales for financial reporting purposes.

2024 年第一季的淨銷售額成長 9%，從 8,500 萬美元增至 9,240 萬美元，這主要反映了新供應商和現有供應商的有機成長，以及我們去年 10 月收購 Data Solutions 的貢獻。同樣，正如我們之前所說，我們關注的 AGB 是我們營收成長的真實指標，因為淨銷售額的計算受到產品組合以及出於財務報告目的將 AGB 轉換為淨銷售額的相應調整的影響。

Under GAAP, in the first quarter, we had an increase in the sale of security maintenance and cloud products, which are recorded net of related cost of sales and therefore leads to a larger adjustment from AGB. to net sales. Data Solutions also has a higher adjustment of AGB to net sales and their net sales were 31% for the quarter compared to our consolidated 26%.

根據美國通用會計準則，第一季度，我們安全維護和雲端產品的銷售增加，這些產品已扣除相關銷售成本，因此導致 AGB 進行較大調整。至淨銷售額。 Data Solutions 也對 AGB 對淨銷售額進行了更高的調整，他們本季的淨銷售額為 31%，而我們的綜合淨銷售額為 26%。

Gross profit in the first quarter increased 12% to $17 million compared to $15.2 million. Again, the increase was primarily driven by organic growth from new and existing vendors in both North America and Europe as well as contributions from data solutions. Gross profit as a percentage of adjusted gross billings was 4.8% compared to 5.0%, driven by decline in our solutions business, GP. and related margin percentage and early pay in North America.

第一季毛利成長 12%，從 1,520 萬美元增至 1,700 萬美元。同樣，這一成長主要是由北美和歐洲新舊供應商的有機成長以及數據解決方案的貢獻所推動的。毛利佔調整後總帳單的百分比為 4.8%，而去年同期為 5.0%，這是由於我們的解決方案業務 GP 下降所致。以及北美的相關保證金百分比和提前付款。

SG&A expenses in the first quarter were $12.5 million compared to $10.2 million for the same period in 2023. SG&A was in line with our internal budget and sequentially from the fourth quarter, SG&A as a percentage of adjusted gross billings was 3.5% compared to 3.3% in the year ago period. The increase was primarily driven by expenses from data solutions, which we expect to reduce as we further integrate their business into our financial operating systems and their suite sales rebound in the second half of the year.

第一季的SG&A 費用為1,250 萬美元，而2023 年同期為1,020 萬美元。為3.3%在一年前的時期。這一成長主要是由數據解決方案的費用推動的，隨著我們進一步將他們的業務整合到我們的金融作業系統中，以及他們的套件銷售在今年下半年反彈，我們預計該費用將會減少。

Net income in the first quarter of 2024 was $2.7 million, or $0.60 per diluted share compared to $3.3 million or $0.74 per diluted share for the comparable period in 2023. As mentioned in our earnings press release, earnings per diluted share in the first quarter of 2024 was negatively impacted by $0.01 in FX and $0.04 in acquisition fees, a portion of which related to carryover of the Data Solutions transaction as well as prospective opportunities.

2024 年第一季的淨利潤為270 萬美元，即稀釋後每股收益0.60 美元，而2023 年同期淨利潤為330 萬美元，即稀釋後每股收益0.74 美元。到的，第一季稀釋後每股收益為2024 年受到 0.01 美元外匯和 0.04 美元收購費用的負面影響，其中一部分與數據解決方案交易的結轉以及潛在機會有關。

Adjusted EBITDA in the first quarter was $5.5 million compared to $5.7 million. The decrease was primarily driven by increased SG&A expenses related to data solutions and lower gross profit generated in the quarter relative to expectations that we expect to return in the back half of the year. Adjusted EBITDA as a percentage of gross profit were affected. Margin was 32.5% compared to 37.4% in the year-ago period. Clearly an unacceptable achievement, we were confident to return to target levels in the future quarters.

第一季調整後 EBITDA 為 550 萬美元，去年同期為 570 萬美元。下降的主要原因是與數據解決方案相關的銷售、一般行政費用 (SG&A) 費用增加，以及本季產生的毛利相對於我們預計下半年回報的預期較低。調整後 EBITDA 佔毛利的百分比受到影響。利潤率為 32.5%，去年同期為 37.4%。顯然這是一個不可接受的成就，我們有信心在未來幾季恢復到目標水準。

Turning to our balance sheet, cash and cash equivalents, were $43.6 million as of March 31, 2024, compared to $36.3 million at December 31, 2023. While working capital remained flat during this period. The increase in cash was primarily attributed to the timing of receivable collections and vendor payments. As of March 31, 2024, we had $1.2 million outstanding debt with no borrowings outstanding outstanding under our $50 million revolving credit facility.

談到我們的資產負債表，截至 2024 年 3 月 31 日，現金和現金等價物為 4,360 萬美元，而 2023 年 12 月 31 日為 3,630 萬美元。現金增加主要歸因於應收帳款催收和供應商付款的時間表。截至 2024 年 3 月 31 日，我們有 120 萬美元的未償債務，在 5,000 萬美元的循環信貸額度下沒有未償還的借款。

On April 29, consistent with prior quarters, our Board of Directors declared a quarterly dividend of $0.17 per share of our common stock shareholders of record as of May 13, 2024, and payable on the 17 of May 2024.

4 月 29 日，與前幾季一致，我們的董事會宣布向截至 2024 年 5 月 13 日登記在冊的普通股股東派發每股 0.17 美元的季度股息，並於 2024 年 5 月 17 日支付。

To echo Dave's earlier comments. Our strong balance sheet provides us with great flexibility to evaluate M&A opportunities, both domestically and abroad to enhance our service and solution offerings across existing and future geographies. We will continue to maintain a limited and very focused line card to ensure we are partnering with most innovative vendors in the market while also taking advantage of some scale opportunity.

回應戴夫之前的評論。我們強大的資產負債表為我們提供了極大的靈活性來評估國內外的併購機會，以增強我們在現有和未來地區的服務和解決方案。我們將繼續維持有限且非常集中的產品線，以確保我們與市場上最具創新性的供應商合作，同時也利用一些規模機會。

Our ERP implementation implementation, coupled with further integration data solutions and our UK operations, will enable us to drive operating efficiencies throughout our global footprint. We believe these initiatives will enable us to grow adjusted EBITDA at a rate that exceeds our increase in adjusted gross billings. So we will keep on time.

我們的 ERP 實施，再加上進一步整合的數據解決方案和我們的英國業務，將使我們能夠在全球範圍內提高營運效率。我們相信，這些舉措將使我們調整後 EBITDA 的成長速度超過調整後總帳單的成長速度。所以我們會遵守時間。

This concludes our prepared remarks. We'll now open it up for questions from those participating in the call. Operator, back to you.

我們準備好的演講到此結束。我們現在將開放電話會議，供參與電話會議的人員提問。接線員，回到您身邊。

(Operator instructions)

（操作員說明）

Vincent Colicchio, Barrington Research. Please proceed.

文森特·科利奇奧，巴靈頓研究中心。請繼續。

Yeah, Dale, so to be clear, was the light volume was key with certain key vendors. Was that a timing issue or is it a lengthening of their sales cycles?

是的，戴爾，需要明確的是，對於某些主要供應商來說，小批量是關鍵。這是時間問題還是銷售週期延長？

A couple of things. The Internet is when we look at the quarter, we have vendors that finished up their fiscal years and different sections. We have some of the bigger ones that actually end of the March, sometimes a leak over in funding. We have two or three of them that are going through different ERP implementations as well. So they get the kind of stuff in there. But we had some vendor stuff that pulled into Q4, some that are pushing into Q2.

有幾件事。互聯網是當我們查看季度時，我們有完成其財政年度和不同部分的供應商。實際上，我們在三月底有一些規模較大的項目，有時會出現資金洩漏。我們有兩三個也正在實施不同的 ERP 實施。所以他們在那裡得到了那種東西。但我們有一些供應商的產品已進入第四季度，有些正在推入第二季度。

So if we look at it, and then we had a large deal with our Spinnaker acquisition a year ago that didn't reoccur in Q1. So if you look at the puts and takes on it was just back and forth, but nothing underlying. And we were talking about as a team, one of our top 20 vendors, 16 of them grew in Q2, one of our top 20 customers, 17 of them grew in Q1. So the underlying pieces still very strong. It's just the timing of some Q2.

因此，如果我們看一下，我們一年前收購 Spinnaker 時發生了一筆大交易，但這筆交易並沒有在第一季再次發生。因此，如果你看一下看跌期權和看跌期權，這只是來回的，但沒有任何潛在的東西。我們作為一個團隊正在談論我們的前 20 名供應商之一，其中 16 家在第二季度實現了增長，我們的前 20 名客戶之一，其中 17 家在第一季實現了增長。所以底層的部分仍然非常強大。這只是第二季的時間安排。

So the way you saw the volume softness do you expect for the year to be on budget with those clients?

那麼，您認為今年銷售疲軟的情況是否符合這些顧客的預算？

We do have, as Drew mentioned in his comments, I mean, we think we have a strong back half of the year. Some of that's already coming in O&R, Q2 stuff that we didn't see in Q1. And we don't anticipate opening and we don't push to bring things into a certain to make a exact number of vendors do and we do do some favors for them as far as hey, when they need to do as far as timing goes so the numbers are what they are and some of them drift into the next Q, Some of them get pulled forward on that side.

正如德魯在評論中提到的那樣，我們確實有，我的意思是，我們認為我們今年後半段表現強勁。其中一些已經出現在第二季的 O&R 中，我們在第一季沒有看到。我們並不預期開放，我們也不會推動將事情帶到一定程度，以使確切數量的供應商這樣做，我們確實為他們提供了一些幫助，只要他們需要做，就時間安排而言所以數字就是它們原本的樣子，其中一些漂入下一個Q，其中一些被拉到那一邊。

Okay. And then the outside of the aforementioned vendors where there was volume within your top 20. Are you growing in line with the rest of the business better? What does that look like here?

好的。然後是上述供應商以外的前 20 名供應商。這裡看起來像什麼？

We are of course, in the new regions and are in depending on their lifecycle, they are growing at a faster rate. That's only talk about, hey, we want to really trying to get double digit growth because growth because that's where the emerging vendors are. The vendor becomes more mature. There's been growth slows down is just almost every industry that we have some larger vendors that they're in the single digit growth and we make it up, make up for it with the emerging ones.

當然，我們在新地區，根據它們的生命週期，它們正在以更快的速度成長。這只是說說而已，嘿，我們真的想努力實現兩位數的成長，因為成長是因為新興供應商所在的地方。供應商變得更加成熟。幾乎每個行業都有成長放緩，我們有一些較大的供應商，他們的成長是個位數，我們用新興供應商來彌補。

So that combination is what we talked about as a management team to focus and get, you know, to that over 10% rate. But if you looked at the numbers, you know, our top line grew overall with revenues and it just depends on the vendor mix and then the margin profile per vendor. So there's a lot of little moving parts, but that's how we do it quarter-by-quarter.

因此，這種組合就是我們作為管理團隊所討論的重點，並獲得超過 10% 的比率。但如果你看一下這些數字，你就會知道，我們的總收入隨著收入的成長而整體成長，這只取決於供應商組合以及每個供應商的利潤狀況。所以有很多小的移動部分，但這就是我們每個季度都是這樣做的。

And has there been any change in areas of segment strength, technology and data center. Those continue to be the key drivers.

分部實力、技術和資料中心領域是否有任何變化？這些仍然是關鍵驅動因素。

Yes, our two our two main ones are pillars in our security and the data center space. So we mentioned in the previous call that we won the contract with CDW for the bath business. That's the first time we've had a real big vendor move to the west has started with Spinnaker in the UK or climate games. We'll see that pickup in the second half of the year. We're just getting going. We're just getting our first orders with them, but that's in the data center space.

是的，我們的兩個主要的兩個是我們安全和資料中心領域的支柱。所以我們在之前的電話中提到，我們贏得了CDW的衛浴業務合約。這是我們第一次有真正的大供應商向西方轉移，從英國的 Spinnaker 或氣候遊戲開始。我們將在今年下半年看到這種回升。我們才剛開始。我們剛剛收到他們的第一批訂單，但那是在資料中心領域。

And then we'll build just like we do in security when you have somebody like sofoles in the monitoring space. So SolarWinds will build a conduit, cottage industry of vendors around them that support them that across sellable.

然後，當監控領域有像 sofoles 這樣的人時，我們將像在安全領域所做的那樣進行建構。因此，SolarWinds 將在他們周圍建立一個管道，即供應商家庭手工業，以支援他們的跨銷售。

Okay, I'll go back in the queue. Thank you.

好的，我會回到隊列中。謝謝。

Thank you, Vincent.

謝謝你，文森。

Howard Root, [Client global solutions].

Howard Root，[客戶全球解決方案]。

I'm not from client Global Solutions, individual investor, but thanks for taking my question on i2's two small ones, and then a more general one for Dale. First, the adjusted gross billings, I think went up $48 million Q1 versus Q1 a year ago, 16%. Can you give us a breakdown of how much of that is organic and versus how much of that is from data solutions or any other acquisitions?

我不是來自客戶 Global Solutions 的個人投資者，但感謝您提出有關 i2 的兩個小問題以及 Dale 的更一般問題的問題。首先，調整後的總帳單，我認為第一季比一年前第一季增加了 4,800 萬美元，成長了 16%。您能否詳細說明其中有多少是有機的，有多少是來自數據解決方案或任何其他收購？

Yes, I'll get Drew I mean, you've got the exact numbers, but it's I think it's while it's open out there, it's probably split 50 50 as close to that.

是的，我會去找德魯，我的意思是，你已經得到了確切的數字，但我認為，當它在那裡開放時，它可能會分成 50 50 接近這個數字。

Yes, that's correct. Out a little a little more data solutions generated approximately $29 million in the quarter for us. Again, as Dale mentioned in his response to events that was lower than our expectation ahead of their prior year quarter and about half really with 2023, but it's one of our large vendors add some significant pull through in Q4, which obviously gave us a very strong fourth quarter our results and exceeded our expectations. But unfortunately, that were detracted from Q1. But data solutions is performing on par. So we're excited about that. And their contribution was very meaningful in Q4 and not as impactful in Q1.

是的，這是正確的。更多的數據解決方案在本季為我們帶來了約 2,900 萬美元的收入。再次，正如Dale 在他對事件的回應中提到的那樣，這些事件低於我們上一年季度之前的預期，並且到2023 年大約一半，但我們的大型供應商之一在第四季度增加了一些顯著的拉動，這顯然給我們帶來了非常大的影響。但不幸的是，這影響了第一季的表現。但數據解決方案的表現相當。所以我們對此感到興奮。他們的貢獻在第四季度非常有意義，但在第一季沒有那麼有影響力。

Okay. So then why do you say second half rebound rather than a Q2 rebound? And I assume that applies to the data solutions key vendor mainly?

好的。那為什麼說下半年反彈而不是第二季反彈呢？我認為這主要適用於數據解決方案主要供應商？

Data solution will tend to work in the quarter is due second quarters there, weakest quarter historically. And as you know, if you look at our historical trends, Q2 tends to be one of our lower quarters as well in terms of both top line as well as gross profit up. So Q2 will be solid, but we'll see a bigger rebound with some of those vendors especially that data solutions portfolio and then the Spinnaker vendors that we acquired in Q3 and Q4?

數據解決方案往往會在第二季度發揮作用，這是歷史上最弱的季度。如您所知，如果您查看我們的歷史趨勢，第二季度往往是我們收入和毛利成長均較低的季度之一。因此，第二季將是穩定的，但我們會看到其中一些供應商出現更大的反彈，尤其是數據解決方案組合，然後是我們在第三季和第四季收購的 Spinnaker 供應商？

Dale, do you have other thoughts?

戴爾，你還有其他想法嗎？

Yeah. Right on track with that with the data solutions team. And just to add to that, Howard, we we integrated the sales teams early January for the data solutions and some of their, as you know, managers are running now our climb UK. team. So that team is pretty integrated at step. One of the next part of the integration is upcoming. It will be in line with our ERP that's going to roll out in July, August timeframe. And we believe by the end of this year, we'll have every company we have a lot of money.

是的。與數據解決方案團隊的合作正順利進行。除此之外，霍華德，我們在一月初整合了數據解決方案的銷售團隊，正如你所知，他們的一些經理現在正在管理我們的攀登英國。團隊。所以這個團隊在步驟上已經非常整合了。整合的下一部分即將推出。它將與我們將於 7 月、8 月推出的 ERP 時間框架一致。我們相信，到今年年底，我們將擁有每家擁有大量資金的公司。

Our systems are now But everything we've acquired in the last two years will all be under one. Andrew is running the project, but the focus is that by the end of Q3, so that we have a true Q4 on one ERP for reporting and you can imagine from three different disparate systems trying to pull those all together. It's not like we're special every company goes through it, but something that we want to get through in Q3.

我們的系統現在是 但是我們在過去兩年中獲得的所有東西都將在一個之下。 Andrew 正在運行該項目，但重點是到第三季末，以便我們在一個 ERP 上擁有真正的第四季度報告，您可以想像三個不同的不同系統試圖將所有這些系統整合在一起。這並不是說我們很特別，每家公司都會經歷這個過程，但這是我們希望在第三季完成的事情。

Yes. Well, good luck with that. Once we all know how hard that is to pull off, but has to be done.

是的。好吧，祝你好運。一旦我們都知道這很難實現，但卻必須完成。

And second question kind of I've always model it kind of keeping it simple like 5% gross profit, 5% of adjusted gross billings, then SG&A below 3%. So net incomes above 2% this quarter. I think the somewhat because of the acquisition and costs there, you're at 4.8% on gross profit, 3.5% on just G&A. So net income is down at 0.8%. Are those realistic targets for the business, the 5%, 3%, 2%? Or how do you look at that or am I off on my assessment of what the number should be?

第二個問題，我總是對其進行建模，保持簡單，例如 5% 的毛利，5% 的調整後總帳單，然後 SG&A 低於 3%。因此本季淨利成長超過 2%。我認為這在一定程度上是由於收購和成本的原因，毛利為 4.8%，一般管理費用為 3.5%。因此淨利潤下降了 0.8%。 5%、3%、2% 等企業目標是否為現實？或者你如何看待這個問題，或者我對這個數字應該是多少的評估有偏差？

Yes, I think your first modelling, it is more accurate. You know, like we said, we had a little softer than in Q1 and some of the margin profile of some of our bigger vendors. But I don't we don't see that we don't see the trend and we know is these vendors get bigger. It's the larger the vendor. There's two parts that happen. They expect there's less work to be done in the channel.

是的，我認為你的第一個模型更準確。你知道，就像我們說的，我們的利潤率比第一季要軟一些，一些較大供應商的利潤率也有所下降。但我不認為我們沒有看到我們沒有看到趨勢，我們知道這些供應商正在變得更大。賣家規模越大。有兩個部分發生。他們預計該管道的工作量會減少。

So they tried to reduce the margin profile not only for us, but also for some ripples through our reseller partners. But on the other flip side of that as a distributor reseller partner as they grow and it gets wider of their business. We're more efficient and actually transacting at. So we save the dollars on that. So it kind of goes for one for one, but that's a pretty good way to look at it. And if you look over the last couple of years, we have enough emerging vendors coming in that have a higher margin profile in that to make up for these larger ones.

因此，他們不僅試圖降低我們的利潤率，還試圖透過我們的經銷商合作夥伴降低一些連鎖反應。但另一方面，隨著經銷商的成長，他們的業務範圍也越來越廣。我們的效率更高，實際交易也更有效率。所以我們省了這方面的錢。所以這有點一對一，但這是一種很好的看待它的方式。如果你回顧過去幾年，我們有足夠多的新興供應商進來，他們的利潤率更高，可以彌補這些較大的供應商。

And we I can just tell you, it's nonstop. We talked about, you know, evaluating 42. There's probably another 10 or 15 that we talk to that, we are just don't even get off to the next phase because they're just not ready even to have a channel target. So if it wasn't for that robust vendors just coming out of the startup phase, I would say, okay, it's going to slow down a little bit. We don't see that at all.

我可以告訴你，這是不間斷的。我們談到了，你知道，評估 42。因此，如果不是那些剛走出啟動階段的強大供應商，我會說，好吧，它會放慢一點。我們根本看不到這一點。

Okay, great. And then just more general and I always like to do this kind of pulling it up to 30,000 seat deal. How do you see the sales environment in trajectory? And in particular is the economy and interest rates. Does any of the macro effects going on worldwide affect you and your business in any way? And how would you see that going forward in the next year, 18 months?

好的，太好了。然後就更一般了，我總是喜歡做這種將其拉至 30,000 個座位的交易。您如何看待銷售環境的發展軌跡？尤其是經濟和利率。全球範圍內發生的宏觀影響是否會對您和您的業務產生任何影響？您如何看待明年 18 個月的發展？

Yeah, I am not that smart, Howard. So on the macro side, we look at and we like it has to have some kind of impact on us. But here's what I would say is we are so small in our market space with our peers, right? If you take a look at the big three distributors are all $40 billion plus they do a lot more hardware than we did. We are software.

是的，我沒那麼聰明，霍華德。因此，在宏觀方面，我們著眼於它必須對我們產生某種影響。但我想說的是，我們的市場空間與同業相比太小了，對嗎？如果你看三大經銷商的市值都是 400 億美元，而且他們生產的硬體比我們多得多。我們是軟體。

So we compete with divisions inside on each of those because what we're seeing, though, is the larger they get some of their vendors you have because if you look at their top 10 vendors are bringing in 90% of their revenues, you get down the line card, those vendors are not getting the care and targeted approach that we provide. So we're seeing share shift from our competitors to us in a pretty big way.

因此，我們在每個方面都與內部部門競爭，因為我們看到的是，他們的一些供應商規模越大，因為如果你看看他們的前10 名供應商帶來了他們收入的90%，你就會得到從長遠來看，這些供應商沒有得到我們提供的關懷和有針對性的方法。因此，我們看到份額從我們的競爭對手轉移到我們這裡。

If I look at just the it was we talked about that we won an award for if you take a look at those vendors, the share shift that they're pushing to us because they're just getting a much higher touch white glove service hotels to sell their products out to the market. So on the positive side, our teams are really taking advantage of that, but we don't see the effect it could have because we're looking at a much smaller target audience. You know, we're not selling to 30,000 resellers who are selling the 7,000 globally where our competitors are doing that. So it's we just don't see it as much.

如果我只看一下我們所說的我們贏得了獎項，如果你看看那些供應商，他們向我們推動的份額轉移，因為他們只是獲得了更高層次的白手套服務酒店將他們的產品出售到市場上。因此，從積極的方面來看，我們的團隊確實在利用這一點，但我們沒有看到它可能產生的效果，因為我們關注的目標受眾要小得多。您知道，我們不會向 30,000 家經銷商銷售產品，而我們的競爭對手卻在全球銷售 7,000 家經銷商。所以我們只是看不到它那麼多。

And we think we can we have a lot of levers we can pull. We have a great balance sheet so we will just go and say, hey, this is where we're going to target now we can move very quickly and put a sales team like we have on a specific vendor and capture a bunch of their business and then do the same thing. So it's much more of a tactical approach there.

我們認為我們可以有很多可以拉動的槓桿。我們有一個很好的資產負債表，所以我們會說，嘿，這就是我們現在要瞄準的目標，我們可以非常迅速地採取行動，將像我們這樣的銷售團隊放在特定的供應商上，並捕獲他們的大量業務然後做同樣的事情。所以這更多的是一種戰術方法。

Okay, great. So that's the good news is the economy doesn't really affect you. The bad news is it's all on you. So success and failure is on your execution.

好的，太好了。所以這是個好消息，經濟並沒有真正影響你。壞消息是這一切都取決於你。所以成功與失敗就在於你的執行力。

That should be right. That's the good news is someone asked me, we can make those choices. So you will take all the blame of that as well. But we feel that and we have enough feelers out there where we can actually know a little better than put your finger in the wind and say, hey, we're going to go after this market or the vendors are approaching us and saying, Hey, can you guys help us in this situation because we've had budget cuts cuts and we can actually fund you through the channel through the margin. And we'll again, we'll double down on that we've built a team with Gilenya, and they've just been a great partner for us, and you'll see those numbers continuing to grow with demand.

應該是這樣。好消息是有人問我，我們可以做出這些選擇。所以你也將承擔所有的責任。但我們覺得，我們有足夠的觸角，我們實際上可以比把手指放在風中說，嘿，我們要追逐這個市場，或者供應商正在接近我們說，嘿，你們能在這種情況下幫助我們嗎，因為我們已經削減了預算，我們實際上可以透過保證金管道為你們提供資金。我們將再次加倍努力，我們與 Gilenya 建立了一支團隊，他們一直是我們的出色合作夥伴，您將看到這些數字隨著需求而繼續增長。

Okay, great. But congrats on the quarter 16% revenue growth, great overall year over year and the challenges come up, but you guys are addressing it. Thanks again.

好的，太好了。但恭喜本季營收成長 16%，整體年成長良好，挑戰也隨之而來，但你們正在解決這些問題。再次感謝。

Thanks Howard.

謝謝霍華德。

Bill Dezellem, Tieton Capital.

比爾·德澤勒姆，泰頓資本。

Thank you. A couple of questions. First of all, allow me to circle back to your February 20 press release referencing Global Technologies and the release seemed a little bit different than your typical typical release. Would you please talk about that relationship and what it means or does not mean?

謝謝。有幾個問題。首先，請容我回顧你們 2 月 20 日引用 Global Technologies 的新聞稿，這似乎與你們典型的典型新聞稿有點不同。請您談談這種關係以及它意味著什麼或不意味著什麼？

Yeah. Thanks, Bill. So mobile technology to the reverse supply. And we're getting asked more and more from our customer base and some of our vendors that we will have a partnership or a division that does, you know, for a diverse and secure supply chain. So we've done this. We've known the founders of global technology. They're actually also for vendors. So it's early stages, but it's some we have big customers that need that.

是的。謝謝，比爾。所以移動技術要逆向供給。我們的客戶群和一些供應商越來越多地要求我們建立合作夥伴關係或部門，以實現多元化和安全的供應鏈。所以我們已經做到了這一點。我們認識全球技術的創辦人。它們實際上也是供供應商使用的。所以現在還處於早期階段，但我們有一些大客戶需要它。

We're looking at a government funded that as well if you're familiar with a program, so on my background is the Fed today. So it's a government contracts are key to that. So nothing new that I can report now that, hey, we've had all these big wins, but it's definitely another component of climb that we need to have as a diverse supplier. And that's why we've built we put that relationship together.

如果您熟悉某個計劃，我們也在考慮政府資助的項目，所以我今天的背景是聯準會。因此，政府合約是其中的關鍵。所以我現在可以報告的沒有什麼新的，嘿，我們已經取得了所有這些重大勝利，但這絕對是我們作為多元化供應商需要擁有的攀登的另一個組成部分。這就是我們建立這種關係的原因。

And so you broke up in a part of that answer. But essentially, this isn't a joint venture it's not an acquisition, but you're working together and specifically for the federal face space, is that it is that the essence now the federal piece will will come right now.

所以你們在那個答案的一部分就分手了。但從本質上講，這不是合資企業，也不是收購，但你們正在共同努力，特別是針對聯邦面孔空間，這是聯邦部分現在的本質。

It's really in our larger partners as we have a diverse supply chain. But yet it's early on those. But yes, I'm saying we're going to take advantage of the federal side of that as well. But it's still in the state and local. It's with our customer base and our vendors that are looking for a diverse diversity partner.

這實際上取決於我們更大的合作夥伴，因為我們擁有多元化的供應鏈。但現在還為時過早。但是，是的，我是說我們也將利用聯邦方面的優勢。但它仍然在州和地方。我們的客戶群和供應商正在尋找多元化的合作夥伴。

Great. Thank you. And then relative to your line card of like I know in this type of a business you've experienced it before. And as have other firms, you just end up with a a vendor or a few vendors that take off in the marketplace and it and you end up being a big beneficiary of their success. So the question is how many vendors on your line card today. Do you see that you think could explode and a good way revenues are just jumping in the next year or two?

偉大的。謝謝。然後相對於您的線路卡，我知道您以前在此類業務中經歷過。與其他公司一樣，您最終只會找到一個或幾個在市場上起飛的供應商，而您最終將成為他們成功的最大受益者。所以問題是今天您的線路卡上有多少供應商。您是否認為未來一兩年內收入可能會爆炸性成長？

If I opened up my management team we would argue over those top five or six years that we do just like when we pick a vendor, we bet on the jockey that are running that vendor with their go to market is with the channel, the same thing as far as them expanding because we've seen what they've done in the past. But then there's a lot of outside factors if you look at the majority of our vendors are not probably cash flow positive right there out of startup fees are still thinking in the grocery channel teams.

如果我開放我的管理團隊，我們會爭論前五到六年的情況，就像我們選擇供應商時一樣，我們押注於運營該供應商的騎師，他們的進入市場是通過渠道，同樣的就他們的擴張而言，我們已經看到了他們過去所做的事情。但是，如果你看看我們的大多數供應商，現金流可能不是正數，因為雜貨通路團隊仍在考慮啟動費用，那麼就會有很多外部因素。

So it depends on where we get them in their life cycle. I would say right now, if it was Bill Foster and put my money on three vendors, you know, I would pick three of our vendors on it would take off on that side. And one of my sales leaders would pick three other ones, probably. So we do have a pretty good robust pipeline where we think we're going to see some real expansion.

所以這取決於我們在它們生命週期的哪個階段獲得它們。我現在會說，如果是比爾福斯特（Bill Foster）並將我的錢投給三個供應商，你知道，我會選擇我們的三個供應商，這將在這一方面起飛。我的一位銷售主管可能會選擇另外三個。因此，我們確實擁有一個相當強大的管道，我們認為我們將看到一些真正的擴張。

The quickest thing in distribution is, like I said earlier, it's like a share shift piece of it, and we're seeing that happen and it's just good win. These bigger, you know, behemoths distributors, you know, just move in a little different direction or gets messy. All the advantages come to us where they need somebody that's much more targeted targeted team.

分配中最快的事情是，就像我之前說的，它就像其中的一個份額轉移，我們看到這種情況發生，這是一個很好的勝利。這些更大的、龐然大物的經銷商，你知道，只是朝著不同的方向前進，或者變得混亂。當他們需要更有針對性的目標團隊時，我們就會獲得所有優勢。

Great. Thank you. I appreciate the help.

偉大的。謝謝。我很感激你的幫忙。

Thanks, Bill.

謝謝，比爾。

Vincent Colicchio, Barrington Research.

文森特·科利奇奧，巴靈頓研究中心。

Yes, one more for me, the share gains you're seeing with certain software vendors from distributors or large distributors. Are they largely quite small emerging companies? Or are they some of them of decent size.

是的，對我來說還有一個問題，就是您從分銷商或大型分銷商那裡看到的某些軟體供應商的份額增長。它們大多是小型新興公司嗎？或是其中一些尺寸還不錯。

I guess it depends on what you mean by that. Vince, I mean decent size, you know, we look at a vendor if they can get to $100 million, that's that would be, you know, a new large vendor for us. If you look at, you know, Sovaldi and Harvoni solar wins $400 million, $500 million, so sort of sizable vendors on that side. But that's what I would consider is some of the larger ones, and we're seeing more of those.

我想這取決於你的意思。文斯，我的意思是體面的規模，你知道，我們會尋找一家供應商，如果他們能達到 1 億美元，那對我們來說將是一個新的大型供應商。如果你看一下，你就會知道，Sovaldi 和 Harvoni Solar 贏得了 4 億美元、5 億美元，所以這方面的供應商規模相當大。但我認為是一些較大的，而且我們正在看到更多這樣的。

Here's what happens in our market typically. And that is as these customers -- I'm sorry, vendors get larger, they look for more efficient ways to get to the market. And then the key word is how do they scale it, right? How to scale their business. We're talking to one right now that says, hey, we needed scale and we can't do it by adding another 80 sales reps. The channel already exists. So you have these thousands of resellers, you've got a handful of distributors.

以下是我們市場上通常發生的情況。這就是這些客戶 - 對不起，供應商變得更大，他們尋找更有效的方式進入市場。然後關鍵字是他們如何擴展它，對嗎？如何擴大業務規模。我們現在正在與一位客戶交談，他說，嘿，我們需要規模化，但我們無法透過再增加 80 名銷售代表來實現這一目標。該頻道已經存在。所以你有這數千個經銷商，你有少數經銷商。

If we use that channel and leverage the channel, we can scale and we don't have to keep dumping the dollars into it. So we're just getting a one for one. We actually are getting or a three x on the investment we put into the channel. So that's where we want to be that's where the inflection point is for these vendors. And we've tried to get early on with them, have a deeper relationship them. So when they go that way, we're ready to go and some of them.

如果我們使用該管道並利用該管道，我們就可以擴大規模，而不必繼續向其中投入資金。所以我們只是一對一。實際上，我們對該通路的投資得到了三倍的回報。這就是我們想要達到的目標，這就是這些供應商的轉折點。我們試圖儘早與他們合作，與他們建立更深入的關係。因此，當他們走那條路時，我們就準備好出發了。

There were just still prospects for us that we haven't signed yet, but we see where they're going and we're saying, hey, we're a good fit for you guys. If you look at the gap between where we sit as adjusted was doing distributed over $1 billion and the next one at, you know, $20 billion it's a big gap for us to grow there without really being I've seen, isn't that much of a competitor to the larger teams.

我們還有一些潛在客戶尚未簽約，但我們看到了他們的去向，我們說，嘿，我們很適合你們。如果你看看我們調整後的分配超過10 億美元和下一個分配的200 億美元之間的差距，你知道，這對我們來說是一個很大的差距，但我並沒有真正看到，不是嗎？

Thank you for responding.

感謝您的回覆。

This concludes our question and answer session. I would like to turn the floor back over to Dale Foster for closing comments that your operators.

我們的問答環節到此結束。我想將發言權轉回戴爾·福斯特（Dale Foster），請其對您的運營商發表最後評論。

All I wanted to say thank you to all stakeholders that we continue to work with and help us build an exceptional company and really focused on the channels. We have a great team where we're going to continue to execute our strategic plan for the benefit of all our shareholders.

我想說的是，感謝所有與我們繼續合作的利益相關者，他們幫助我們建立了一家卓越的公司，並真正專注於管道。我們擁有一支優秀的團隊，我們將繼續執行我們的策略計劃，以造福所有股東。

With that, I appreciate everybody joining us today.

在此，我感謝今天加入我們的大家。

Concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

今天的電話會議結束。此時您可以斷開線路。感謝您的參與。