Forrester Research Inc (FORR) 2007 Q1 法說會逐字稿

Greetings, ladies and gentlemen, and welcome to the Forrester Research first quarter 2007 financial results conference call. (OPERATOR INSTRUCTIONS). It is now my pleasure to introduce your host, Phyllis Paparazo, Director of Investor Relations for Forrester Research. Thank you, Ms. Papparazo, you may now begin.

Thank you. Good morning ,and thank you for joining our first quarter, 2007 call. Today we are hosting our conference call from our European headquarters in Amsterdam. With me today are George Colony, Forrester's Chairman of the Board, Chief Executive Officer and acting Chief Financial Officer, and Paul Bermeister, Senior Financial Advisor to the CEO.

A replay of this call will be available until Tuesday, May 15th and can be accessed by dialing 877-660-6893. Please reference the confirmation ID238336 and the confirmation account 242.

This call is also available via web cast and will be archived in the investor section at Forrester.com. Before we begin, I would like to remind you that this call will contain forward-looking statements within the meaning of the Private Securities Litigations Reform Act of 1995. Words such as expects, believes, anticipates, intends, plans, estimates or similar expressions are intended to identify these forward-looking statements.

These statements are based on the company's current plans and expectations and involve risks and uncertainties that could cause future activities and results and operations to be materially different from those set forth in the forward-looking statements.

Some of the important factors that could cause actual future activities and results to differ are discussed in our reports and filings with the Securities and Exchange Commission.

The company undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Now, I'd like to turn the call over to Paul Bermeister.

Thanks, Phyllis. Good morning. I'll review Forrester's preliminary and selected first quarter results as of March 31st, and then turn the floor over to George for a business update. On March 5th, we informed you that the results of the ongoing investigation into our past stock option granting practices were likely to result in a need to restate our historical financial statements for the periods 1997 through 2006.

Because of this, we have chosen to present only selected financial information for the first quarter. Forrester's first quarter revenue increased 17% to $47.3 million dollars from $40.6 million dollars in the first quarter last year. First quarter research services revenue increased 17% to $31.3 million dollars from $26.8 million dollars last year.

Research services revenue comprised 66% of our total revenue in line with our expectations for the quarter. First quarter advisory services and other revenue increased 16% to $16.0 million dollars from $13.08 million in Q1 of 2006 and comprised 34% of total revenue for the quarter.

International revenues were 30% for the first quarter compared to 31% from last year. We expect international revenues to comprise 28 to 30% of total revenue in 2007. Our cash and marketable securities at March 31st were $228.4 million dollars up $20.6 million dollars from year end.

We will not be in a position to repurchase shares until we have completed the accounting work related to the ongoing investigation and we are once again current on our regulatory filings. At that point we intend to resume our repurchase program when it is accretive to earnings.

Net accounts receivable at March 31st, was $40.2 million dollars, compared to $33.3 million dollars at March 31, 2006. Our days sales outstanding at March 31st was 84 days, up from 77 days when compared to 3/31/06. And accounts receivable over 90 days was 10%, down from 11% last year, and within our target range.

Deferred revenue at March 31st was $100.2 million, up 16.5% from March 31, 2006. The total of deferred revenue plus future accounts receivable is another indicator of future revenue growth and as of March 31, the year-over-year growth rate was 22.1%. Agreement value, the total value of all contracts for research and advisory services in place without regard to the amount of the revenue that has already been recognized or has yet to be recognized was $173.2 million dollars at March 31st, a 17.2% increase from last year.

In the first quarter, our retention rate for client companies was 78%. And our dollar retention rate was 88%. Both of those rates are calculated on a 12-month rolling basis and are within our target ranges.

Our enrichment rate was 107% for the 12-month period ended March 31st, compared to 101% a year ago. At the end of the quarter, our total for client companies was 2,367 up 55 from a year -- from 12/31/06, I'm sorry, that's from 12/31/06.

For head count at March 31st, Forrester had a total staff of 807 up 11% from 727 a year ago. Current head count includes a research staff of 299, up 17 from last year, and sales staff of 272 up 23 from 3/31/06.

The last topic I'd like to cover today is our business outlook for the rest of the year. At this time we are reiterating our full-year 2007 revenue guidance of $207 to $212 million dollars. We'll update our guidance upon filing our December 31, 2006 10K and our first quarter 2007 10Q. Thank you. I'll now turn the floor over to George.

Thanks, Paul. Good morning, everyone. I will summarize our performance in the first quarter and then after my remarks, well take questions. Although much of the first quarter was spent transitioning to a role-based strategy, we got off to a good start for the year.

Q1 revenue grew 17%, cash increased more than $20 million and deferred revenue was up 14.2% to $100.1 million. I am pleased to report that our move to role-based is on track. As I explained in first call, on our last conference call, Forrester as of January 1st, now goes to market-based on the 17 roles of our clients.

We are organizing the 3 client groups, IT, with 8 roles, including CIO and Enterprise Architects. Marketing and Strategy with 5 roles, including Direct Marketing Professionals and Marketing Leadership Professionals.

And Technology Industry with 4 roles, including Analyst Relation Professionals and Market Research Professionals. Our core research product, WholeView 2, became Role View on February 5th. Clients now access 17 unique sites containing research relevant to titles and responsibilities.

The site features new role-specific tools, including workbooks, quick benchmarks and analyst presentations and the role sites are designed to tap the collective experience and wisdom of the 17 professional communities we are serving. Feedback from clients has been supportive of the changes. Positive to neutral comments have been running at 15-to-1 since the launch.

Positive comments have centered on really two issues. Number one, the higher relevancy of the research, and secondly, Forrester's continued innovation. We've had positive feedback from the two leading firms that research the technology analyst industry.

In a recent report, Knowledge Capital Group said, and I quote. "So far the prize for making the process as painless as possible goes to Forrester.". And from Outsell, a recent report said, "...of particular interest with the Forrester announcement is the sheer dedication to the roles, not just across the product lines, but also geographically, a truly global approach to the concept of roles.".

Through the quarter, client company growth has stayed on pace, we ended the quarter with 2,367 client companies, an increase of 55 clients from year-end 2006. And new 1B plus client companies signing on Q1 included Apollo Group, Borders Group, Goodyear Tire and Rubber Company, Lowe's Companies, Mattel, Inc. and Sun Chemical.

And, as Paul noted, client retention came in at 78% for the quarter with dollar retention at 88%, also remaining strong. I would now like to review progress for each of our products starting with research.

In Q1, 438 new research documents were added to Role View. The four sites with the largest number of registered users were Application Development and Program Management pProfessionals with 4,200 users. Enterprise Architecture Professionals with 3,800 users. Technology Market Professionals with 3,400 -- and IT Infrastructure and Operations Professionals with 3,300 users. We hosted 81 teleconferences in Q1, with a total attendance of 6,050 participants.

Role View is on track to obtain revenue growth in the 6 to 8% range for the year. Turning now to leadership, to the Forrester leadership boards. The CIO group now has 258 members. The Technology council now has a total of 286 members. The Analyst Relations and Technology Marketing councils added members for a total of 224.

Our three marketing focus boards for CMO's, Direct Marketing Professionals and International Marketing Executives, ended the quarter with 133 board members. So at the end of Q1, the Forrester leadership boards had 901 members. The FLB business is on track to obtain revenue growth of between 70 and 72% in 2007. Our data business continues to build.

Forrester's Technidata and services gathers and analyzes data on consumers in fifteen countries, in Asia, Europe and North America. Client renewal rating for Q1 for North American for Consumer Technographics was 89%.

Hispanic Technographics and Asia Pacific Technographics continue to build their client base in the quarter. We expect the data business in 2007 to expand revenue by approximately 20%. Turning to Forrester's consulting business, as you know, we took action in 2006 to increase sales of consulting after the business slowed in Q2 of last year.

Since that time we've been working to, number one, reduce engagement size back into our historical range of $50,000 to $90,000 and, two, dedicating additional resources to the contract process that have been slowed by Sarbanes Oxley. I'm glad to report that both efforts are yielding excellent results. Consequently consulting beat plan in the first quarter.

We believe that our consulting business will grow 14% in 2007. Although we hosted -- excuse me, although we are hosting 11 event this year, none were scheduled for Q1. That said, I can tell that you sales of events being held in Q2 and beyond have been strong.

We expect revenue from events to grow between 8 to 10% in 2007. So to conclude, Forrester has gotten off to a good start for the year. While this is most definitely a transition year for the company as we move to role based, indications from clients are positive.

Much work is still to be done, but we feel that we are on track for the year. We hope to see many of you as we visit with investors in the second quarter. Thank you for listening to the call. We will now take questions.

Thank you. Ladies and gentlemen, at this time, well be conducting a question-and-answer session.

Our first question comes from Laura Letterman with William Blair and Company.

Yes, good morning. A few questions.

Good morning.

Hi, George. Any sense of the timing of the restatement, whether you think it will take 6 months,9 months, of being delisted in terms of not having what the NASDAQ needs in terms of filings. Also, any update on the CFO search. And I have two quick questions after that, thanks.

Laura, this is Paul, what we're seeing with other companies that are going through this process is that five months is really fast. That's the shortest we've seen. And the range has been 10 months or more. So we're -- you know, it's hard to tell when you're in this process how long it's going to take. But we're looking at that 5 to 10 month range, and if you start the clock ticking in mid December with our first announcement, you could look in that range which would say no later than September/October. But each one of these is a unique process, and we're learning as we go.

CFO search, Laura?

Yes.

As you know, this is retained search with Spencer Stewart. They actually have 20 very good candidates. We've interviewed , I've not interviewed ast yet, but we've interviewed, I think 10 candidates, I'm actually seeing candidates late this week and early next week. So, we're quite happy with how it's

With respect to delisting, we have been in touch with NASDAQ and we have a hearing scheduled with them later this week. We expect that to be routine, and we're just going through the process.

What is the rule on how long it is that you don't have K's and Q's that causes delisting?

Laura, the rule is that when you are out of compliance, as we are, you are asked to come in and have a hearing. At that point NASDAQ then rules and they -- I'll be honest, that I don't know precisely what their flexibility is.

Well, they'll give you a period of time. If you then exceed that period of time, there's another hearing.

That's exactly right. They will give us a period of time that we have to file. And we will learn a lot more later this week.

Okay. Shifting to the underlying business. One, you were talking about Role View increasing 6 to 8% for '07, any sense of what the long-term growth rate of that business is?

I think it's certainly in the double-digits. You know, as a company, we always look to grow in the 15 to 20% range. I think -- you know me, Laura, I am a very positive person. I think it's an excellent product. Much, much higher relevancy than WholeView 2. Very good value in the marketplace, so I think this can grow in the -- commensurate with the growth of the company.

I think one of those things that I'm wondering about is the CV grew 17% or whatever the number was, yet you're only expecting Role View to go 6 to 8. So I was wondering about the discrepancy about Q1's growth in contract value and the expectation for the role-based to only grow 6 to 8% for the year, because that's....

Yes, I think what you're seeing is FOB is becoming a bigger business for us. So, you're seeing the pickup in the FOB business and also the data business.

Okay. One final question. DSL, why up so much?

DLS is up primarily because of mix of business. We have some contracts, particularly in southern Europe. Where terms are typically quite a bit longer, and so it's just a mix issue, it's nothing that we're concerned about. You notice that the percentage of receivables over 90 days was down down, so, down slightly. So this is just a mix of business issue, and nothing that we're concerned about.

Thank you so much. I'll pass it on.

Our next question comes from Dom LaCavo with Canaccord Adams.

Good morning, just a few questions, I guess we can start with the leadership boards. I know you had mentioned additional boards coming online this year. Do you have any update on that front as far as -- I think it was 1 to 3 that you were expecting for '07?

Yes, we're still expecting 1 to 2 by the end of this year.

Okay, so that's kind of a second half kind of event or --

Yes.

Okay. And then as far as potential price increase, are you still on track for an increase by say midyear?

I would say that we're on track to make a decision. Actually over the next 6 weeks. And if we did -- and that -- after making the decision, the analysis would be somewhere midyear.

Okay. And then I guess on the last call we're talking about clients transitioning, are all the clients transitioned to the role-based strategy, I know 11,000 was the number you quoted last time. I think 65,000 was the remainder, what's the status on that?

Approximately 55,000. So about 10,000 to go.

Okay.

Which is very, which is totally in line with the way our clients enter the site in the periods of time that -- how often they enter the site essentially.

Okay, so what drives that? As far as how fast that happens?

It depends on how much usage you'll get from a certain user. Some users are on the site five times a day, some are on five times a week, some are on five times a month, some are only going once a month.

Okay, so it's based on the first time that they log on since you made the transaction?

Exactly. Exactly.

Okay. And then --

They also have to do with renewal rates, Dom because they may be renewing just as we made the transition.

Sure, okay, and then operating margin for full year, I know you're only giving certain metrics, but 16%, 17% or so, is that still fair?

Dom, we're just absolutely not talking about any guidance below revenue at this point.

We're commensurate with the guidance for the year.

Okay.

We're reiterating the guidance for the year --

For revenue beyond or just --

Just revenue.

Okay. And then as far as the CFO search, I know you gave some color as far as interviewing, is that something that we could expect to happen reasonably soon? What's the target on that, and how close are you to your target as far as when we could see a new CFO?

The target is end of the quarter, to have the person hired. And I've, we have actually been surprised at how much -- we had a lot of interest. We have a lost good resumes.

Okay, that's a good thing.

Yes.

Great. Thanks a lot.

Okay. Thanks, Dom.

Our next question is coming from Sandy Notardonato with Robert W. Baird and Company.

Hi, I guess my first question is a clarification, I think George, in your prepared remarks, you mentioned deferred revenue of $101 million. And Paul, you mentioned $102, I know this just minor, but since we don't have it in front of us, can you tell me what the deferred revenue number was.

Yes, I said 100.2. And George said 100.1. It was a rounding issue that we didn't clear up. It's 100.2, and 'll check his presentations more closely.

I'm sorry. I misunderstood. It's -- I'm usually not that precise. More -- More importantly, I'm curious, the cost structure, this quarter, was it in line with historical trends if you take out the costs that are associated with the options backdating.

Boy, that gets awfully close to the guidance that are issuing financials, there was nothing unusual in our cost structure.

Okay. That's a very fair way of answering. And then the guidance that you've given for the year, I'm just curious, the thought process behind it, it looks like, you know, very strong revenue growth that you're expecting out of FLB, data, very strong, consulting, probably a little bit lighter. Role View, I guess this is what you were thinking when you came into the year, that it was going to be a little slower because you were making the transition, so you've beat expectations here in revenue in the first quarter -- what's the thought process on keeping guidance the same or reiterating the guidance for the remainder of the year?

The thought process is really conservatism, you know, vis-a-vis the transition, Sandy -- the transition for us is not a one-quarter deal, it's a year-long deal. We're in a new organization - We have a new product, 17 new sites, so it really is conservatism around transition.

We gave you a range of about $5 million dollars, $107 to $112, and we still think we're within that range.

Okay. And how would you --

I'm sorry, $207 to $212.

Right, right, and how would you characterize on a scale of 1 to 10 the success of the transition to Role View here in the first quarter, 10 being best.

I think -- we're all making signals at each other. I think -- I only judge it one way, Sandy, and that is, was it disruptive to clients and is the feedback from clients positive, do they like the new experience? Of course, we knew a lot of it, because we beta-tested it so thoroughly, the feedback has been -- as I think I've told you, I ran around the company looking for negative news about this, you know, some angry client. You usually get, you know - And they're just not out there. We had our board of clients meeting last week. We have a - It's a board of client that is advise us, and they are over the top. They really, really like what we've done. So I hate to be so positive, I actually try to be rational about this, but it's -- feedback is excellent. So for me, that would make it an 8, I think, somewhere in that range.

Okay, so that's good, so then if you assume an 8 at the very least for the remainder of the quarters at the transition, would you expect to exceed the guidance that you've reiterated today, coming at the high end of the guidance that you've given today? I'm just, I'm trying to handicap your conservativism.

Yes, and I think the deal is, you know, my 8 is really based on early client feedback - right? We have, I've got a team that has to gel, I've got the site which has to be improved, there are a lot of other factors involved here.

Understood.

Okay. So I really, I'd love to, but I really can't.

Okay, what about --

I'm not sandbagging this -

Sandy, excuse me, I just want to jump back very quickly to your comment, your question about our cost structure, I want to clarify, when I said there's nothing unusual for the cost structure for the first quarter, that, of course, excludes any impact of investigation costs or any of the accounting adjustments as a result of the investigation.

Okay. Understood. Thank you, Paul. A couple of other questions, attrition at the -- you know, employee attrition, if you can just talk about what it was specifically at the research level and at the sales level.

Let me see, research was around 3%.

Good.

Which is -- and sales was higher, it was 9%.

Okay.

But Charles Rutstein is our COO. I asked him about that, he said, that's a feature, not a bug. We're moving lower performers out faster.

So it was higher on the involuntary side?

Exactly. But lower on the voluntary.

Okay.

And so you know, the base statement here, head count is at historical attrition and hiring rates, essentially. For the company is 5%.

Okay. And then one of your, not necessarily call it a competitor, but what Wall Street considers a peer reported last week indicating that corporate spending was having a negative impact on their performance or their guidance for the remainder of the year, and they were also not meeting their hiring targets. Can you talk about what you're seeing at the corporate spending level and also if you could talk about your hiring targets for the year? And how you are tracking to those?

Okay. I'm going to give you a technical answer on the U.S. - on IT spending. This actually comes from our research. As you know, we were expecting IT spending this year to drop to the 2% to 3% range. By the way, IT spending was up around 6% in '06. So, we were originally projecting 2 to 3% increase for '07 which is about half the number. Our research is showing that in fact the recession in tech happened in third quarter, fourth quarter, and somewhat in first quarter. But it's now beginning to modulate - moderate, let's say moderate. So we actually have tech spending in '07 at 5 to 6% almost in line with '06 spending. So, we see some weakness early in the year in Q1, but the rest of the year we think we'll be quite -- we'll have a nice recovery in the second half of the year. That all being said, we don't feel any tech spending impact on us at this point.

Okay. And the hiring.

As far as hiring, as hiring goes, we're right on historical rates for hiring.

For hiring.

We have not felt that.

And then did you give the percent of client penetration at the 1B plus level?

Sandy, that's an 18% consistent with where it was at year end.

Okay, and then my last question, can you give what you're expecting to generate in cash for the year or does that fall under the category of what you can't say.

Because we aren't issuing any income guidance, I'm not in a position to give you cash guidance either.

Okay, let me ask a different question then. For the first quarter, did the cash results from operations exceed your internal expectations?

It's a hard one to --

Let's -- There are a lot of moving parts in cash, I would say that they were in line with expectations last year. We received a lot of cash from the exercise of options, which we did not receive, of course, this year, because that window's been closed. For most of the quarter. That was the one striking difference from the first quarter of last year.

Okay.

Generally in line, Sandy.

Okay, I'm sorry, just one follow-on question. The consulting business at 14% growth for this year. How would you say you rate your ability to win business and who would you say you're competing most with at the consulting level at the $50 to $90,000 dollar contract side.

In the data space, we'll compete on the data companies like Com Score. Or VNU, and in the text space, a little bit of Gartner, but, you know, we're doing some work that other companies really can't do. Often it will be a tech analysis plus data and often our competitors can't match that. So -- and a very small amount of the strategy consultants will bleed in there and we'll compete with them. But, I would say, we think about the major competition here, it's really the data players.

So, by and large, on the technology side, you're consulting engagements are not competitively bid?

They're competitively bid, but -- well -- they're always competitively bid, but I would say that because of this analysis plus data, we tend to win those. Really nobody else can go up against. You'll see a bid against it but often we'll win those deals.

Okay, great. Thank you very much.

Okay, thanks, Sandy.

Our next question comes from Andrew Tooth with Black Rock Incorporated.

Hey it guys, how are you?

Hey, Andrew.

Let's see, a laundry list of questions. The enrichment rate was 107.

Yes.

Is that a rolling 12 months?

Yes, it is.

Why is that down from Q4? You know, we had sort of seen a nice trend upwards last year and the goal last year was kind of end the year at 113 - 115. is that is there something in that 107 I should be aware of?

Andrew, I think that's really a transitionary issue.

For one thing, it compared to 101% for the Q1 number of last year. So I think there's some seasonality built in there.

I mean, keep in mind we spent January training and briefing the company on Role View. I think it's somewhat of a transitionary factor.

There's some seasonality in there that I'm just not thinking about --

There seems to be.

Okay. How many clients would you guys expect to add this yea?. Last year you were saying 250 to 300. What would this year's goal be?

300 to 350.

Okay. And then -- so you started the year at 55?

Yes.

Okay. Now, last year, you know, you sort of started strong and tapered into the year, but this year you kind of have things going the other way. Is that attributable to sales force hiring? I think it's another transition sales force hiring?

I think it's another transitionary issue. As we looked to the year, we saw started slowly, finishing strong.

Okay. Where do you view the stock is accretive? You know, where does it stop being accretive to buyback stock.

We --

Is it still -- you said previously in the -- about 30 Bucks. Is there any change in your assumptions or do you think it's still around that level?

We haven't done the calculation recently. Because we've not been buying back, it's a real moving target. It's treasury function. Exchange rates, it's a big algorithm. I would say it's probably in the 30, 31 range.

It's consistent with that range, I would say, Andrew.

Yes. Okay. On the acquisition front. Do you guys need to have all your documents in before you announce anything?

No.

Okay.

We -- it would depend on the mood of the seller, I presume, but there's no legal impediment to us. Moving forward if we wanted to.

And why the change? I mean, you guys, this is just -- more curiosity than anything. Why after you announced the options investigation in December, but yet you were willing to put out guidance after Q4 and now you aren't willing to do that after Q1, is it just lawyers?

No, it's -- it's really practical. You think about when -- first of all, back in our last release, we had not yet issued our March 5th release that said that we were pulling our historical financials.

Okay.

The impact of the accounting is pervasive, up and down the income statement. Above and below the line. And although it primarily affects GAAP accounting, You know, you have to do GAAP before you can do proforma and what we didn't want to do was introduce confusion in the future.

Yes.

With people saying, wait a minute, last year, we thought you reported X and now you're saying you reported Y. Just seemed a lot cleaner to do it this way. And we looked at a bunch of other companies who are going through this. What we regarded as a representative sample and it was a pretty large sample. About half of those companies choose to do what we're doing or not release financials at all.

Andrew, we also want to keep our resources focused on finalizing the stock option accounting. That's important to us.

Can you just spend one second on what takes so long about this? You either back dated options or you didn't. And then there's expense involved in the flow through the P&L once you determine if you did or you didn't, right?

It is very easy to say that.

I wish it was thus.

We wish it was thus. It's very very complicated in terms of going to each of literally thousands of option grants. Finding the documentation, validating the documentation. And then doing the accounting once you've completed all of that documentation search. And once the accounting is done, then our auditors need to -- obviously need to audit it, and need to review and audit the resulting 10K and 10Q that come out of that so it's just a lengthy process, as I've said, we've looked at dozens of other companies going through this and they're all the shortest is 5 or 6 months. A lot are a lot longer than that. And some of them are ongoing long beyond that 5 to 10 month range that I mentioned.

Some of it is out of your hands, Andrew, because your external auditor has to get the results and then they have to do their own audit. That's a big step.

All right, you guys have a lot of balls in the air and the execution looks great. Congratulations on a great quarter.

Thanks, an do you. Appreciate it.

Our next question comes from Laura Letterman with William Blair and Company.

Just a few quick follow-up questions. One, and I had to step out for a second so I hope this wasn't answered. DSO's, why were they hired? Did you say it, was it just the European, one pair, was there anything else?

It was -- what I said was, that we have some contracts in southern Europe with long payables terms, so it's really a mix issue, within that. I did answer the question, but it's really a mix issue, there's nothing that we're concerned about or that's outside of our expectations.

Okay. Shifting gears. When we were on the road a couple months ago, you talked about the possibility of a price increase in the second half of the year and that you're not charging more for the role-based research. Can you talk a little bit about the odds of pricing increase and what would lead to it or not lead to it. be or not be -- you also mentioned whether Gardiner increases prices may have an impact as well?

Well, just to be said, Laura, the analysis is ongoing. If we do have a price increase, it will be sometime in the middle of the year. As far as what our competition does, that's less important to us than essentially how the market, will the market bear a price increase? Number one and two, our value, is our value increased, improved? So, those are the major factors for us. So, still ongoing, we'll let you guys know as soon as it happens.

And one final question on the sales head count churn being 9%, I take it that's not an annualized number, that was just a quarterly number?

Yes.

And would you expect to continue to cut low performers is that quarterly turn an anomaly or are there a lot more people --

That's an anomaly, we tend to run around, in the 6 to 7% range. So it's a little bit high.

Okay, but you've cleaned out the low performers? We should have more static base going-forward?

Exactly.

Thank you.

Thanks.

Our next question is a follow-up question from Sandy with Robert W. Baird and Company.

Hi, thanks, I know you didn't have any events here in the first quarter, I'd like to know if you can just give me a sense of what you expect the events-specific business to grow in 2007?

I had that in my presentation, click back here.

Okay. Sorry that I missed it.

It's okay Just trying to -- Between 8 and 10%.

8 and 10%?

Yes.

If I have my numbers right by each business segment at the high end of the range, you gave a range for Whole View 6 to 8, Boards 70 to 72, et cetera. Looks like revenue should shake out at at least $215 million. I know it's off by $3 million, but does that sound right?

Well, remember, I gave you ranges for growth here on all these businesses?

Yes.

And -- but that is within our guidance, I believe. Our guidance is 207 to 212.

You'd have to assume that we hit every -- you'd have to assume that we hit a home run every time we got up to the plate and, you know, adding up the top end of our range of guidance may not be the most reliable way to get to how we've determined --

We'd love it if it happens.

Yes, we'd love it if it happened.

Okay. Just thinking about it that way. Great, thank you.

And I kept, you see, I kept using the word approximately before those numbers as well.

Sure. Thanks.

Thank you.

There are no further questions in cue. I'd like to hand the floor back over to management for closing comments.

I'd like to thank everyone for listening to the call, and we'll be traveling in the 2nd quarter, so we hope to see most of you out on the road.

Thank you very much.

Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time.