Dolphin Entertainment Inc (DLPN) 2019 Q1 法說會逐字稿

Greetings, and welcome to Dolphin Entertainment First Quarter 2019 Earnings Call. (Operator Instructions) As a reminder, this conference call is being recorded. It is now my pleasure to introduce your host, Mr. James Carbonara. Thank you. You may begin.

Thank you. Good day, and once again, welcome to Dolphin Entertainment's First Quarter 2019 Earnings Call. With me on the call are Bill O'Dowd, Chief Executive Officer; and Mirta Negrini, Chief Financial Officer.

I'd like to begin the call by reading the safe harbor statement. This statement is made pursuant to the safe harbor for forward-looking statements described in the Private Securities Litigation Reform Act of 1995. All statements made on this call with the exception of historical facts may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although the company believes that the expectations and assumptions reflected in these forward-looking statements are reasonable, it makes no assurances that such expectations or assumptions will prove to have been correct. Actual results may differ materially from those expressed or implied in forward-looking statements due to various risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those expressed or implied in the forward-looking statements, please see the risk factors detailed in the company's 2018 annual report on Form 10-K, those contained and subsequently filed quarterly reports on forms 10-Q as well as in other reports that the company files from time to time with the Securities and Exchange Commission. Any forward-looking statements included in this earnings call are made only as of the date of this call. We do not undertake any obligation to update or supplement any forward-looking statements to reflect subsequent knowledge, events or circumstances.

Now I would like to turn the call over to Bill O'Dowd, Chief Executive Officer of Dolphin Entertainment. Bill, please proceed.

Thanks, James. Safe harbor never sounded so compelling. And good morning, everyone. So in our normal order, I'll arrange my comments as follows: first, I'll highlight our financial results; second, I'll spend some time providing operational updates; and third, I'll turn it over to Mirta to dive deeper into our financial results before having our Q&A.

As for the financial results, our total revenue increased 9% to $6.3 million. This total revenue growth was achieved despite both a decrease of $250,000 of sales revenue for Max Steel from our content production segment, Some sales for that project are effectively completed, and the departure of 3 senior-level publicists at 42West in June of last year, all of them whom then were with the company in the first quarter of last year, which makes us even more pleased that revenue on our core segment of entertainment publicity and marketing increased 14% to a record $6.2 million, our highest ever quarterly revenue performance in this segment. This increase in entertainment publicity and marketing revenue was attributable to growth in the movie and TV division of 42West as well as the acquisitions of The Door and Viewpoint Creative, all of which more than offset the loss of revenues from the departure of the aforementioned publicists as revenues in the segment increased for the quarter by nearly $800,000 year-over-year.

As a reminder, this revenue diversification is a critical advantage for our acquisition strategy. 12 months ago, the talent division of 42West represented over 40% of our entertainment publicity and marketing revenue. Today, it is less than 20%. And 1 year from now, we don't expect any single division of our business being even 25% of our total revenues in the segment, including our successful movie and television division of 42West.

On an operational front, we are managing for revenue growth, and our unique Super Group of best-in-class entertainment marketing companies each contributed to our strong first quarter results and are each doing great work now halfway through our second quarter. 42West had a successful awards season with a fantastic night at the 2019 Academy Awards, 47 nominations, which were approximately 40% of all nominations, and 8 wins, which were 1/3 of all awards handed out that night. Also, on the 42West front, we have continued to hire senior publicists in 2019, complimenting the 4 seasoned talent publicists we hired in the second half of last year as we advance the process of replacing the revenues lost by the publicists' departures beginning last year.

Turning to our lifestyle, culinary and hospitality PR division, The Door announced in late March an expansion to its operations with the formation of a dedicated consumer division. The vertical is led by managing director, Nicole Lowe. Nicole is an expert in the consumer space with nearly 2 decades of experience, executing strategic communication programs for respected brands, including Verizon, Unilever, Target, Sony, Intercontinental Hotels and many, many others.

The first quarter also saw remarkable PR campaigns for the opening of Hudson Yards in March, the $25 billion development in Manhattan for which The Door represents all food and beverage. And subsequent to the quarter ending, The Door was pleased to congratulate long-time clients, Chef Patrick O'Connell from The Inn at Little Washington and Kevin Boehm and Rob Katz of Boka Restaurant Group on receiving James Beard Foundation Awards, also known as the Oscars of the food world. These annual awards are presented to recognize culinary professionals in that space.

It seems like a good point to reiterate that The Door and 42West once again earned spots on Observer's prestigious PR Power 50, a widely respected ranking of the 50 top public relations firms of any type in the nation. This marks the third year in a row that both firms made the list and the second year in a row they were both in the top 15.

Finally, moving to our boutique production and branding agency, Viewpoint Creative, recently worked with Investigation Discovery to develop a brand campaign to reinforce the network's place as America's #1 true crime network. As a former producer, I can tell you this is a very cool campaign. Viewpoint used a continuous moving camera from an overhead aerial perspective to recreate various crime scenes throughout all on-air promo spots created. The client is thrilled, and it wouldn't surprise if this campaign receives awards consideration in its own right. Anyway, as you can imagine, we are very pleased to have this original video production and branding capability in-house and have dedicated -- have been dedicated, excuse me, to the cross-education of the various sales teams in 42West, The Door and Viewpoint. Original video production for the marketing of entertainment content is mandatory in today's environment. Digital marketing is only going to increasingly take bigger pieces of the marketing budget, and to market successfully on digital platforms means that you have to be able to generate appealing promotional content. An appealing promotional content means predominantly video. Viewpoint was an enormously tactical acquisition for us, and they are now fully included into the new sales pitches of The Door and, as appropriate, 42West.

In summary, we're thrilled to be reporting record revenues for the entertainment publicity and marketing segment. Our Super Group is growing and will continue to do so as we add clients and cross-sell between divisions. With respect to growth through acquisition, with the integration of Viewpoint now effectively complete, we see a number of opportunities to further expand our entertainment marketing Super Group. Adding to our capabilities will only increase our value among customers, resulting in higher sales and faster growth.

Thank you for your time and attention. And at this point, I'll turn it over to Mirta for a more in-depth review of the financials.

Thank you, Bill, and good day. As Bill stated earlier, total revenue increased 9% to $6,317,089 from $5,784,925 in the same period of prior year. We derive the majority of our revenues from our entertainment publicity and marketing segment. Our entertainment publicity and marketing revenue increased by 14% to $6,238,099 compared to $5,455,733 in the same period in the prior year. The increase was due to the revenues of The Door and Viewpoint, which were acquired on July 5, 2018, and October 31, 2018, respectively, which more than offset the loss of revenue caused by the departure of several publicists from 42West in June of 2018 as revenues for the segment increased by almost $800,000 for the quarter. Revenues from our content production segment were $78,990 as compared to $329,192 for the same period in the prior year. The decrease is primarily due to the normal revenue cycle of our motion picture, Max Steel.

Overall, expenses increased by approximately $1.4 million. Within that $1.4 million increase, direct costs increased by approximately $0.6 million for the 3 months ended March 31, 2019, as compared to the 3 months ended march 31, 2018. The increase is primarily due to the direct costs associated with the operations of Viewpoint. Also within the $1.4 million increase in expenses, payroll expenses increased by approximately $0.7 million for the 3 months ended March 31, 2019, as compared to the 3 months ended March 31, 2018. The increase is primarily due to the entertainment publicity segment, including the payroll of The Door and Viewpoint, offset by a decrease in the payroll expense of 42West related to the departures of the senior publicists.

Our operating loss for the quarter of $825,161 included direct costs of $1,187,419 and noncash items from depreciation and amortization of $481,642 compared to an operating loss of $98,924, which included direct costs of $571,336 and noncash items from depreciation and amortization of $371,181 in the prior year.

Net income for the quarter was approximately $0.1 million or $0.01 per share based on 15,944,443 weighted average shares outstanding for basic earnings per share and a net loss of approximately $1.4 million or $0.08 per share based on 18,690,377 weighted average shares outstanding for fully loss per share -- fully diluted loss per share for the 3 months ended March 31, 2019. In comparison, our net income was approximately $0.8 million or $0.07 per share based on 12,517,660 weighted average shares outstanding for basic earnings per share and $0.8 million or $0.07 per share based on 12,786,065 weighted average shares outstanding on a fully diluted basis for the 3 months ended March 31, 2018. In both Q1 2019 and Q1 2018, a substantial portion of such net income was attributable to the change in the fair value of the put rights.

That concludes my financial remarks. I will now ask the operator to open the phone lines for Q&A. Operator, can you please poll for questions?

(Operator Instructions) Our first question comes from Allen Klee with Maxim Group.

This is Jack Vander Aarde speaking in for Allen Klee. Great quarter. I just had a few questions. Revenue growth for the quarter was very strong, came in above what we estimated. Does this upside performance suggest any changes to your internal pace of growth for the rest of the year?

Yes. Thank you. It's a great question. Well, we feel strongly that the consensus for the second quarter is probably pretty close to in line. There's a natural seasonality to the business where the second quarter is usually our lowest revenue quarter across the entertainment marketing, publicity segment. We do feel that the year will beat analyst estimates -- consensus estimates, as we guided after the call for the 10-K, but I wouldn't suggest increasing them more than they are now based on the second quarter being pretty in line.

Yes. That's helpful. And I think you mentioned 42West represents around 20% of revenue versus 40% historically. Is that correct?

Well, their talent division does. That's right. But they have 3 divisions, movie and television being their largest.

Got you. And The Door made a strong contribution to the revenue outperformance this quarter. Is there any sense of color you can provide of what mix or where that mix is trending in terms of The Door's contribution to revenue?

Sure. The Door might be our fastest-growing company at the moment. They are really doing well. Lois and Charlie, they're co-CEO's, are managing tremendous growth. And we expect this actually accelerate with the formation of the consumer products division that we're investing in. We hired Nicole in the first quarter. Also, a full team of senior publicists joined the -- for that division in the first quarter. So that investment is part of what increased the payroll cost. But we expect the growth of that division to more than offset the increased payroll, of course, and we should see the benefits of that fully in the second half of the year.

Got it. Great. And then you spent some time discussing your outlook or plans to build the Super Group. Can you just expand on what do you see is most exciting in terms of near-term opportunity with the Super Group expectations?

Sure. Yes. We've stated our intention to buy at least one more company in calendar 2019 and hopefully can be successful with that. It'd be great if we could buy 2 just like we did last year. Some of the areas that we've mentioned before that we think would really complete services necessary for our leading PR firms would be digital marketing/social media marketing. That will be a very good addition for sure. And we may want to broaden our PR verticals to include 1 or 2 others that would be nice add-ons to our motion pictures and television as well as our culinary and live events that The Door gives us.

Our next question comes from Austin Moldow with Canaccord Genuity.

I'm wondering if there's any way to contextualize how you've been able to cross-sell since adding more services under one roof. Can you talk to a kind of maybe attach rate you have today? Like how many services are utilized by an active client versus what it was a year ago and maybe what you hope it could be?

Sure. Yes, Austin. Well, prime example is the Super Group's now up to 3 companies, which will multiply -- the examples will multiply when we did the 4, 5 companies. We'd be utilizing Viewpoint as a service provider to the PR firms. So for context, this will be an example of including Viewpoint into client strategy meetings when video is a key component of the PR campaign.

To give a sense of that, let's take Nicole's consumer products division as a classic example. Insert here a Fortune 50 company has a desire to roll out a new product or service and this may want to make the consumer aware of it through earned media. A classic PR campaign would probably need to include a digital and social media campaign, and that campaign needs somebody to make videos. So the idea that there would be a monthly fee for the PR services that would be paid to The Door would be complemented by a video production budget for a series of videos that either explain how the product works or simply could be as simple as testimonials from potential customers -- or existing customers, excuse me. Or it could be traditional promotional video of 30-second spot, 15-second spot that runs either digital or in traditional television.

That type of cross-selling is not just traditional cross-selling when you have 2 sister companies able to do -- provide 2 different services, but it informs the strategy of the campaign from the very beginning. Because as PR firms are hired to guide the client towards an effective campaign, increasingly, video is a part of it from the very beginning. It's part of the tool set that is almost expected to be used. And then what the video's purpose is, is very much part of that strategy. And it may be a series of videos.

So I don't think in today's PR world, you want to go to a client and say, "Here's some great idea." You know what? Now we'll go outside of our company and we'll go look for the best vendor for this and see if they -- we think they can execute it. It is much more powerful and much more effective to have that vendor in the meeting from the beginning and ideating with the client and with the PR company. Was that helpful?

Yes. It brings me to my second question, which is about Viewpoint. How many projects does Viewpoint complete in a given quarter or year? And how do you expect that to change after, say, a full year under a Dolphin/42West ownership?

The number of projects is a difficult one to answer because both -- there could be one very large project that dominates a portion of the staff, but it also could be on how we quantify. Is a series of videos 1 project or 7 different projects? Yes, if you follow. What I could say though is that we do expect, after a full year under 42West and The Door, the number of projects that Viewpoint would do. We could see increasing by between 25% and 50% on -- they'll be working on, on any given month. I guess that will be -- effective same way as delivering by the end of a quarter, at the end of a year. And we're starting to see that growth already in second quarter from first quarter.

Got it. And my last question is around current competitive environment. Can you share what your view is of your other PR competition and specifically in the movie, TV realm given that your principle competitor is owned by an advertising holding company. And those holding companies have faced some turmoil and have looked to shed some assets over the last year or 2. How that's changed things? And maybe how you're -- the environment has changed and how you're able to win new business or even attract new talent?

Sure. That was a very good question. I need to unpack a little. Yes. The large holding companies are legacy and they're fantastic and they're -- I think it's fair to say they're struggling for growth. Certainly, top line growth has been challenged as well. We -- and so that has allowed top talent to shake free quite frankly. Look at Nicole Lowe coming to us from Weber Shandwick is a tremendous talent. As a team, we were able to build because of that. I think in terms -- now that was consumer products and I know you're talking about -- or your area of interest was really intelligent.

There, the challenge in the marketplace with so much content in marketplace and this much or that much more to come because as I like to remind people, Apple really hasn't entered the market yet. And Disney Plus, Warner Streaming and NBCUniversal are all coming. Then that number of TV shows and film, new or an increase in original programming has never been seen before, I think, in the 100 years of the entertainment industry. I haven't phrased it that way before, but as I sit here and think about it on the fly, it's very true. The number of original scripted series have doubled in less than the last 10 years from 250 to 500, and we don't have those new streaming services onboard.

So what this means for reaching the consumer is vastly different. And I don't know that we -- I don't know how anyone would possibly expect to reach those consumers with paid media. I don't think there's enough money that could be devoted to it, and I don't think those platforms want to spend the advertising dollars on someone else's networks to reach a broad-enough audience. So it's going to rely heavily on earned media, PR and social media. And as we compete for those projects, all I can say is it's a nice position to be in to have such a leading group like 42West with the success we can point to, the immediate past of this year's Academy Awards, this past year's Golden Globes, et cetera.

Our next question comes from Jon Hickman with Ladenburg Thalmann.

Bill, can you hear me okay? Hello?

Hi, Jon.

Oh, okay. Could you talk a little bit about your production size -- production?

Oh, I'm sorry, Jon. It broke up there.

Yes, I'd like to see the targets -- yes, the -- what your plans are?

Sure. So we are complete with a development fleet of scripts for those what we would call our larger budget, independent films, our sports films that we've talked about in the past as well as a streaming-service-level budgeted films that we developed in the past 12 months. If the larger budgets are between $5 million and $8 million, these budgets are probably between $2 million and $5 million and are -- rolling them out into the marketplace now.

I'm actually doing this call from Cannes, France, over here for the film festival. And with films very much on my mind, we will be attaching directors after meetings both this week and in the ensuing few weeks and expect to announce our first director attachment, I would say, in short of order with the goal of being in production on the first project before the end of the year or certainly in preproduction. We're just simply contingent on sourcing or matching the financing to go on the first project. So we're excited for this and ready to get started on the production side.

Okay. And then could you explain a little bit the jump in direct cost associated with Viewpoint when it seems like a lot versus the company that's doing a fairly modest amount of revenues right now?

Sure. In some of those direct costs...

I mean, I can jump.

And I'll let Mirta to attack, but some of those may also be -- have been related to The Door. Mirta, would you like to take that?

Sure. What Viewpoint does is they allocate some of their cost of -- their operating cost to the projects. So that's why the direct costs go up so much. They take part of their rent, payroll, of course, for the people that are working on a project and a lot of the other SG&A expenses and they allocate them per project. So that's why that direct cost line is -- has jumped up.

So -- okay. Okay. So -- I get that. So that line goes up with the number of projects they do then?

Correct.

Correct.

There is variable cost with each project?

Correct. Some -- right. But keep in mind that for instance, when they allocate rent, rent is going to be the same. It may just move from SG&A to direct cost. So it won't be that all the cost will go up. It's just where they're going to be classified, yes.

Okay.

So I think you'll see that unless we start hiring more people because the volume of projects increases or we have to outsource some of the work, the cost in general for Viewpoint shouldn't change substantially even if we have an increase in sales. You may just see that some of the costs are going to be allocated -- or reallocated from SG&A and payroll into direct cost.

Okay. Sorry, I haven't looked -- is the Q out?

The Q is out, yes.

Our next question is from -- with -- from Rick Reiss with Georgica.

I have sort of a series. I have the queue in front of me and I have a series of things that I just need clarification on. But it's a pretty complicated balance sheet for a small company. But essentially, my series of questions revolve around the following. One, it looks like you burned a lot of cash or used a lot of cash in the first quarter. Two, there's an asset that materialized out of -- wasn't there at the end of last quarter, called the right of use assets, of almost $7 million.

I'm going to run down these. You can just make a list of and comment on which ones you want. Under liabilities is a significant current and a long-term lease liability which didn't exist before, which is well over $7 million. And under -- I guess this is a rather small issue but it indicates on your earnings per share, where you earn, where you have positive net income of $122,000 or $0.01 per share, once you have positive net income, I don't understand how you go to negative earnings per share just by increasing the number of diluted shares. And the diluted share calculation is up. You -- it's up almost 15%. So this is just -- and as the person reported just before, there's a significant increase in revenues in the quarter but there's an equally significant or almost the same amount of increase in the cost, whether they're direct or G&A. So it's just hard to count if you're making any money.

Well, let's unpack it, Rick. I got those 4 questions. So Mirta, would you address both the increase of the asset and the liability related to the lease and new accounting rules there?

Sure. So that came about -- the FASB came out with new accounting for leases, which now basically requires. And it was -- you had to...

Let's start at the beginning. What is a right to use asset of $7 million that's almost -- on your balance sheet?

So that's what -- right. So that's what the FASB has caused. And now what you have to do is you have to -- any lease -- any operating lease or capital lease that you have now has to be put on the balance sheet. FASB has kind of changed their way of thinking and everything now is about control. So if you control the asset, they consider that -- or you control what you're leasing, they consider that it should be on your balance sheet. So what you do is you have to -- on the day of implementation, which for us is January 1 of 2019, we had the fair value, all of our operating leases, and we had to put them in the balance sheet as an asset and then a corresponding liability. This is nothing -- I mean this is something that we had from before. They're (inaudible) as a way that FASB...

Basically property and equipment stuff?

Correct. It's office leases. Basically what we have are office leases and some office machinery. That's it.

Okay.

If you go to our 10-Q, there's a footnote that explains all of the leases that we have and then it explains how we calculated the fair value and how we came up with these -- with the asset and the liabilities.

Okay.

The earnings per share...

And then -- yes?

How about -- I'm really interesting cash.

Okay.

So you -- am I right? It looks like you basically -- generally had a cash flow that -- it basically looks like you burned a couple of million dollars in cash in the first quarter.

Well, no. I don't think our operation did that at all. The operation...

I'm just looking at cash. I'm looking at cash at the end of the year and cash currently.

Sure. But we were paying down those puts and debt with that cash to operations.

Right.

Okay.

Right.

Yes.

Unless it was paid...

So we're managing revenue growth and also towards positive EBITDA by the end of the year. But the operating cash loss for the quarter was far, far less than $2 million. It was less than $400,000, as we invested in Nicole and her team.

Right. We also had the second installment of the acquisition of The Door, which was a chunk of that one.

Yes. That was $1 million, Rick, the second of 2 installments to purchase The Door that we paid in January as part of the use of proceeds from our fundraising last summer. Thank you for that reminder, Mirta. So...

That's repayment -- now that's acquisition of The Door?

The acquisition of The Door was in 2 different installments. One of them was in July of 2018 when we closed, and then the second installment was January 2 of 2019.

So is that the [7 71] or the [3 61]?

That's [7 71] because we had advanced to them $200,000 in October for their tax obligation. It was -- the closing was meant to be -- it was $4 million, $2 million in cash and $2 million in stock. And it was split evenly between July and January. In October, we advanced -- we paid them in July. We paid them the $1 million and we paid them the $1 million in shares. They requested an advance in the second installment so that they can meet their tax obligation in October. So we advanced them that $270 -- $70,000 and then we made the second payment, which included an adjustment for working capital of $46,000. So that's the 7 71 that you see in the quarter.

Okay. And the bottom of the cash -- it says cash, cash equivalents and restricted cash, which is on your cash flow statement, is down $200,000, but unless I'm misreading the balance sheet, we're down $2 million. So...

Well. No, because this...

Again, (inaudible) what I'm doing wrong here?

No. The cash flow statement compares March 31, 2018 to March 31, 2019, where the balance sheet compares December 2018 to March 31, 2019. So that's -- yes, that's where you have that difference.

Why would -- I'm just coming through the Q for the first time. I mean it's sort of complicated here because there's no financial statement in your press release and a financial statement -- so you have to go to the Q and...

Well, there's a balance sheet and income statement in the earnings release.

That's the one. We didn't see it. Yes, that's the one that we opened. Anyway, I mean it is what it is. I don't want to spend a lot of time on this. I just -- it just strikes me that there are some things here which could have or should have been discussed on the press release to make some of this clear. That would be my suggestions or a big suggestion. Could I -- just a lot of changes on the balance. They're just -- as I said, there are a lot of things that are just complicated, and the last thing you need is people spending all their time on that if the business is doing well.

Right.

Sure. Well, we can do an offline call too Rick and get suggestions on that.

That's fine. Okay.

Yes.

I mean what -- just one last thing. It was -- you did issue some common stock, right, and some -- that's the supplemental disclosures. You issued $1 million of common and this is liability for consideration -- for contingent consideration for the acquisition, another [A20]. I'm looking to the supplemental exposure of noncash flow information.

Right. So we issued the second installment of The Door. We issued the second portion of the shares. It was 307,692 shares, which was the equivalent of $1 million. And that was part of the purchase price of The Door. It was their second installment. So that's the stock that was issued. And then we also had one -- we have some convertible notes outstanding. And one of the note holders converted their note into stock. And that -- so those were the 2 issuances of stock that we had.

Okay. And then -- and that all accounts for the big increase in fully diluted shares?

Well, fully diluted shares, the way to calculation, the way to FASB and this is something that -- this is -- sometimes, the FASB comes out with guidance and how we have to calculate earnings per share. So how we calculate the earnings per share and why the fully diluted is so large is for fully diluted, the requirement is that you basically take any instrument that you have outstanding that could be converted into stock and you assume that it's converted, assuming that it's dilutive. So in our case, it's the put rights. And you're asking why could -- why are we going to negative income? Well, what you need to do when you have to add those shares is you also have to take whatever income you have reported on your financial statements that's attributable to that instrument and reverse it.

So in our case, we had a gain on the change in fair value of the put rights. So you have to reverse that gain. We end up with a loss. And then on top of that, you add the shares that would be increased by the put rights because the method that you're supposed to use is called the treasury stock method. And basically, that method asks you to calculate how many shares you would need to sell in the market to raise sufficient capital to repurchase your put rights. And those are the shares that you have to include in your exact fully diluted earnings per share. It's like -- it's something that FASB imposed. This is part of GAAP and we can't change that.

Right. Let me just ask you one -- let me just ask one last question.

Sure.

Footnote 2, going concern, do you want to comment on that?

Well, I think with the going concern, we are looking at ways to clean up our balance sheet as much as possible. So there are certain -- we have some certain notes that will come up -- that will come due and that we'll -- we're going to address. We also -- the put rights, as we go paying off these puts, will become less. So we're looking at how we can move some of our items, either move them into a longer term or some of them will be paid off. And then we can -- we're working to be able to remove that going concern.

Yes. The largest item to -- Rick, and which is where it's not really understood well enough and we need to do as good job as possible to explain it is because put rights are for a limited term, right? They all expire December of 2020. And as we pay them down, those -- the liability that's on our balance sheet decreases and the cause for going concern will either -- will be eliminated entirely. So that's our goal. If we can accelerate that to remove the going concern currently to the elimination of the put rights, we'd love to. And we have a couple of ways to attempt to do that, that Mirta was indicating there. So that's -- we would expect to try to remove that as soon as possible. But it's those obligations that prevent it -- prevent us from doing so immediately.

Ladies and gentlemen, we've reached the end of the question-and-answer session. At this time, I'd like to turn the floor back over to Bill O'Dowd for closing comments.

Okay. Well, thank you, everyone, for joining. I know some are joining from the West Coast. I know it's early, far easier for me over here in Europe in the middle of the afternoon. And I appreciate everyone continuing to follow us and our story. We're excited and our subsidiaries are doing well. We feel the synergy with Super Group. It's showing in how we're managing the company towards revenue growth. And hopefully, we'll continue to have good results to report in the quarters ahead. So I thank everybody for their time.

This concludes today's conference. We thank you for your participation. You may now disconnect your lines.