Intelligent Protection Management Corp (IPM) 2024 Q3 法說會逐字稿

Greetings, and welcome to the Paltalk third quarter 2024 results conference call. (Operator Instructions) Please note, this call is being recorded. I will now turn the conference over to your host, Kara Jenny, CFO of Paltalk. Kara, the floor is yours.

大家好，歡迎參加 Paltalk 2024 年第三季業績電話會議。（操作員指示）請注意，此通話正在錄音。現在，我將會議交給主持人，Paltalk 的財務長 Kara Jenny。卡拉，現在請你發言。

Hello, everyone, and welcome to the Paltalk operating and financial results conference call for the third quarter ended September 30, 2024. By now, everyone should have access to the earnings results press release which was issued earlier this afternoon at approximately 4:00 PM Eastern Time. This call is being webcast and will be available for replay.

大家好，歡迎參加 Paltalk 截至 2024 年 9 月 30 日第三季營運和財務業績電話會議。現在，每個人都應該能夠看到今天下午早些時候（美國東部時間下午 4 點左右）發布的收益結果新聞稿。本次通話正在進行網路直播，可供重播。

In our remarks today, we will include statements that are considered forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995, including forward-looking statements about future results of operations, business strategies and our plans, our relationships with our customers as well as market and potential growth opportunities. In addition, management may make additional forward-looking statements in response to your questions.

在我們今天的演講中，我們將納入《1995 年私人證券訴訟改革法案》所定義的前瞻性陳述，包括關於未來經營業績、業務戰略和計劃、我們與客戶的關係以及市場和潛在增長機會的前瞻性陳述。此外，管理階層可能會針對您的問題做出額外的前瞻性陳述。

Forward-looking statements are based on management's current knowledge and expectations as of today and are subject to certain risks uncertainties and assumptions related to factors that may cause actual results to differ materially from those anticipated in the forward-looking statements. We offer no assurance that these expectations and beliefs will prove to be correct.

前瞻性陳述是基於管理階層目前的認知和預期，並受與可能導致實際結果與前瞻性陳述中預期的結果有重大差異的因素相關的某些風險、不確定性和假設的影響。我們不保證這些期望和信念將被證明是正確的。

A detailed discussion of such risks and uncertainties are contained in our filings with the SEC, including our most recent quarterly reports on Form 10-Q and our annual report on Form 10-K. You should refer and consider these factors when relying on such forward-looking information. The company does not undertake and expressly disclaims any obligation to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

我們向美國證券交易委員會提交的文件中詳細討論了此類風險和不確定性，包括我們最近的 10-Q 表季度報告和 10-K 表年度報告。當您依賴此類前瞻性資訊時，您應該參考並考慮這些因素。本公司不承擔更新或修改我們的前瞻性聲明的任何義務，無論是由於新資訊、未來事件或其他原因，除非適用法律要求。

On this call, we will refer to adjusted EBITDA, a non-GAAP measure that when used in connection with GAAP results, provides us and our investors with additional analytical tools to understand our operations. For adjusted EBITDA, we've provided a reconciliation to the most directly comparable GAAP financial measure in our earnings press release, which will be posted on the Investor Relations section of our website at www.paltalk.com.

在本次電話會議中，我們將參考調整後的 EBITDA，這是一項非 GAAP 指標，與 GAAP 結果結合使用時，可為我們和我們的投資者提供額外的分析工具來了解我們的營運情況。對於調整後的 EBITDA，我們在收益新聞稿中提供了與最直接可比較的 GAAP 財務指標的對賬，該對帳將發佈在我們的網站 www.paltalk.com 的投資者關係部分。

And with that, I would like to introduce Paltalk's Chief Executive Officer, Jason Katz.

接下來，我想介紹一下 Paltalk 的執行長 Jason Katz。

Thank you, Kara, and good afternoon, everyone. Greatly appreciate you taking the time to join us on today's call. We will discuss our operating highlights and financial results for the third quarter ended September 30, 2024. We will also provide an update on our business objectives and strategies. .

謝謝你，卡拉，大家下午好。非常感謝您抽出時間參加我們今天的電話會議。我們將討論截至 2024 年 9 月 30 日第三季的營運亮點和財務表現。我們還將提供有關我們的業務目標和策略的最新資訊。。

After my opening statement, our CFO, Kara Jenny, will give a summary of our financial results for the third quarter ended September 30, 2024. Following our prepared remarks, we will move into the Q&A portion and answer any questions that were submitted prior to this call.

在我的開場發言之後，我們的財務長 Kara Jenny 將總結我們截至 2024 年 9 月 30 日第三季的財務表現。在我們準備好發言之後，我們將進入問答環節，回答本次電話會議之前提交的任何問題。

With that, I would now like to walk you through the recent financial and operating highlights and near-term business objectives. Our team had a very busy and productive end to the summer, highlighted by the signing of a merger agreement to acquire Newtek Technology Solutions from NewtekOne through a two-step merger process.

現在，我想向大家介紹一下最近的財務和營運亮點以及近期的業務目標。我們的團隊在夏天度過了非常忙碌和富有成效的時光，其中最突出的是簽署了一份合併協議，透過兩個步驟合併流程從 NewtekOne 收購 Newtek Technology Solutions。

Pursuant to the merger agreement, at closing, we will pay $4 million in cash to Newtek and will issue to Newtek 4 million shares of newly created series of Paltalk's preferred stock. Newtek is also entitled to receive an earnout payment of up to $5 million based on the achievement of certain cumulative average adjusted EBITDA thresholds for 2025 and 2026 fiscal years.

根據合併協議，在交易完成時，我們將向 Newtek 支付 400 萬美元現金，並向 Newtek 發行 400 萬股新創建的 Paltalk 優先股。如果 2025 和 2026 財年累計平均調整後 EBITDA 達到一定門檻，Newtek 還可以獲得高達 500 萬美元的獲利支付。

We also recently announced our entry into an asset purchase agreement with Meteor Mobile Holdings, Inc., pursuant to which we agreed to sell our telecommunication services provider, Vumber, as well as its Paltalk and Camfrog applications and all assets related to such services provider and applications to Meteor Mobile in exchange for a cash payment of $1.35 million, the assumption of all our liabilities and obligations arising out of or relating to the transferred assets on or after the closing of the divestiture.

我們最近還宣布與 Meteor Mobile Holdings, Inc. 達成資產購買協議，根據該協議，我們同意將我們的電信服務提供商 Vumber 及其 Paltalk 和 Camfrog 應用程序以及與此類服務提供商和應用程序相關的所有資產出售給 Meteor Mobile，以換取 135 萬美元的現金支付，並承擔在資產剝離完成時或因轉讓資產剝離完成時或因轉讓的所有負債和義務完成時或因轉讓資產而產生的義務完成時或

The sale of our Paltalk and Camfrog applications is required under the terms of the merger agreement with NewtekOne. Following the divestiture, Paltalk will retain all patents, patent applications, any rights or causes of actions related to such patents and patent applications, including the patent litigation against Cisco, and any assets, including intellectual property that are not exclusively related to such applications.

根據與 NewtekOne 的合併協議條款，我們必須出售 Paltalk 和 Camfrog 應用程式。剝離後，Paltalk 將保留所有專利、專利申請、與此類專利和專利申請相關的任何權利或訴訟原因，包括針對思科的專利訴訟，以及任何資產，包括與此類申請非專門相關的智慧財產權。

We are also entitled to receive for the six month period beginning July 1, 2025, and each subsequent annual period beginning on January 1, 2026, 2027 and 2028, certain cash earn-out payments based on a percentage of cash revenue, net of refunds received by Meteor Mobile that is attributable to the businesses of the transferred assets that we are selling.

我們也有權在 2025 年 7 月 1 日起的六個月期間以及從 2026 年、2027 年和 2028 年 1 月 1 日開始的每個後續年度獲得一定比例的現金收益，扣除 Meteor Mobile 收到的歸因於我們正在出售的轉移資產業務的退款。

We believe the acquisition of Newtek Technology Solutions will provide excellent value for our stockholders. We expect the acquisition, once completed, will have an immediate meaningful impact on our revenue. Since NTS revenue in 2023 was approximately 3 times greater than Paltalk's 2023 revenue.

我們相信收購 Newtek Technology Solutions 將為我們的股東帶來巨大的價值。我們預計，此次收購一旦完成，將對我們的收入產生直接且有意義的影響。因為 NTS 在 2023 年的收入大約是 Paltalk 2023 年收入的 3 倍。

We also expect the acquisition to provide enhanced opportunities for future growth and optimization. We are extremely excited upon closing of the acquisition to enter the cloud infrastructure and cybersecurity sectors, with the acquisition of a business we deem right for growth, both organically and through potential accretive acquisitions in the future.

我們也希望此次收購能為未來的成長和優化提供更多的機會。我們非常高興能夠完成此次收購，進入雲端基礎設施和網路安全領域，透過收購我們認為有利於成長的業務，既可以實現有機成長，也可以透過未來潛在的增值收購實現成長。

Given our management team's extensive technology expertise that has been demonstrated throughout the years, we are confident in our ability to integrate, operate and grow this business and enhance stockholder value.

鑑於我們的管理團隊多年來所展現的豐富技術專長，我們有信心整合、經營和發展這項業務並提高股東價值。

We have an ample cash balance of $12.1 million as of September 30, 2024, and we are excited to focus our attention on growing the Technology Solutions business. As a result of the entry into the acquisition agreement and the divestiture agreement, our near-term business objectives now include the confirmation of the acquisition and divestiture, integration of the business of NTS following the closing of the acquisition, continuing our efforts to improve user experience with our ManyCam software and optimize features for both consumer and enterprise applications, and continuing to defend our intellectual property.

截至 2024 年 9 月 30 日，我們擁有 1,210 萬美元的充足現金餘額，我們很高興將注意力集中在發展技術解決方案業務上。由於達成了收購協議和剝離協議，我們近期的業務目標現在包括確認收購和剝離、在收購完成後整合NTS的業務、繼續努力改善ManyCam軟體的用戶體驗並優化消費者和企業應用程式的功能，並繼續捍衛我們的智慧財產權。

On August 29, 2024, a jury in the District Court for the Western District of Texas awarded Paltalk $65.7 million in a verdict against Cisco Systems for infringing US patent number [6,683,858]. On October 8, 2024, an order granting a motion for final judgment was entered into in the court in connection with the lawsuit. The final judgment was entered in favor in the amount of the award and started the time for filing any post-trial motions.

2024 年 8 月 29 日，德州西區地方法院的陪審團判決思科系統侵犯美國專利號 6,570 萬美元，並判給 Paltalk[6,683,858]。2024年10月8日，法院就該訴訟作出了准予終審判決動議的命令。最終判決支持賠償金額，並開始了提起任何審判後動議的時間。

The exact amount of the award proceeds to be received by us will be determined based on a number of factors and will reflect the deduction of significant litigation-related expenses, including legal fees. Consequently, we estimate that we would receive no more than 1/3 of the gross proceeds in connection with the award subject to the post-trial proceedings, including any potential appellate proceeds by Cisco.

我們將獲得的獎金具體金額將根據多種因素確定，並將反映扣除重大訴訟相關費用（包括法律費用）後的結果。因此，我們估計，我們將獲得不超過審判後程序裁決相關總收益的 1/3，包括思科任何潛在的上訴利益。

Now I'd like to pass it to Kara for a financial summary of our third quarter ended September 30, 2024.

現在，我想將其交給卡拉，以便獲得截至 2024 年 9 月 30 日的第三季的財務摘要。

Thank you, Jason. Revenue for the three months ended September 30, 2024, decreased by 23.4% to $2.1 million compared to $2.8 million for three months ended September 30, 2023. Decrease was attributed to a decrease in subscription revenue of 23.9%. Loss from operations for the three months ended September 30, 2024, increased by 333% or $1.3 million to a loss of $1.7 million compared to a loss of $0.4 million for the three months ended September 30, 2023.

謝謝你，傑森。截至 2024 年 9 月 30 日的三個月的收入為 210 萬美元，而截至 2023 年 9 月 30 日的三個月的收入為 280 萬美元，下降了 23.4%。下降是由於訂閱收入下降了23.9%。截至 2024 年 9 月 30 日的三個月的營業虧損增加了 333% 或 130 萬美元，至虧損 170 萬美元，而截至 2023 年 9 月 30 日的三個月的虧損為 40 萬美元。

The increase in loss from operations was attributed to the decrease in revenue for the three months ended September 30, 2024, as well as an increase in professional fees of $0.8 million in connection with the acquisition agreement and the divestiture.

營業虧損增加歸因於截至 2024 年 9 月 30 日的三個月的收入減少，以及與收購協議和資產剝離相關的專業費用增加 80 萬美元。

Net loss for the three months ended September 30, 2024, increased by 731.2% or $1.3 million to a net loss of $1.5 million compared to a net loss of $0.2 million for the three months ended September 30, 2023. And adjusted EBITDA loss for the three months ended September 30, 2024, increased by approximately 1046.2% or $1.3 million to an adjusted EBITDA loss of $1.4 million compared to adjusted EBITDA loss of $0.1 million for the three months ended September 30, 2023.

截至 2024 年 9 月 30 日的三個月的淨虧損增加了 731.2% 或 130 萬美元，至淨虧損 150 萬美元，而截至 2023 年 9 月 30 日的三個月的淨虧損為 20 萬美元。截至 2024 年 9 月 30 日的三個月的調整後 EBITDA 虧損為 10 萬美元，較截至 2023 年 9 月 30 日的三個月的調整後 EBITDA 虧損 10 萬美元增加約 1046.2% 或 130 萬美元，至調整後 140 萬美元虧損。

Now turning to our financial results for the nine months ended September 30, 2024. Revenue for the nine months ended September 30 decreased by 16.2% to $6.9 million compared to $8.3 million for the nine months ended September 30, 2023. This decrease was attributed primarily to a decrease in subscription revenue of 17.5%.

現在來看看截至 2024 年 9 月 30 日的九個月的財務表現。截至 9 月 30 日的九個月的收入為 690 萬美元，而截至 2023 年 9 月 30 日的九個月的收入為 830 萬美元，下降了 16.2%。這一下降主要歸因於訂閱收入下降 17.5%。

Loss from operations for the 9 months ended September 30, 2024, increased by 129.9% or $2 million to a loss of $3.6 million compared to a loss of $1.6 million for the nine months ended September 30, 2023. The increase in loss from operations was attributed to the decrease in revenue for the nine months ended September 30, 2024, as well as an increase in professional fees of $1.1 million in connection with the acquisition agreement and the divestiture.

截至 2024 年 9 月 30 日的 9 個月的營業虧損增加了 129.9% 或 200 萬美元，至虧損 360 萬美元，而截至 2023 年 9 月 30 日的九個月的虧損為 160 萬美元。營業虧損增加歸因於截至 2024 年 9 月 30 日的九個月的收入減少，以及與收購協議和資產剝離相關的專業費用增加 110 萬美元。

Net loss for the nine months ended September 30, 2024, increased by 274.3% or $2.2 million to a loss of $2.9 million compared to a loss of $0.8 million for the nine months ended September 30, 2023. Adjusted EBITDA loss for the nine months ended September 30, 2024, increased by approximately 265.1% or $2.1 million to an adjusted EBITDA loss of $2.9 million compared to adjusted EBITDA loss of $0.8 million for the nine months ended September 30, 2023.

截至 2024 年 9 月 30 日的九個月的淨虧損增加了 274.3% 或 220 萬美元，至虧損 290 萬美元，而截至 2023 年 9 月 30 日的九個月的虧損為 80 萬美元。截至 2024 年 9 月 30 日的九個月的調整後 EBITDA 虧損增加約 265.1% 或 210 萬美元，至調整後 EBITDA 虧損 290 萬美元，而截至 2023 年 9 月 30 日的九個月的調整後 EBITDA 虧損為 80 萬美元。

Cash and cash equivalents totaled $12.1 million at September 30, 2024, a decrease of $1.5 million compared to $13.6 million at December 31, 2023, and we had no long-term debt on our balance sheet at September 30, 2024.

截至 2024 年 9 月 30 日，現金及現金等價物總額為 1,210 萬美元，較 2023 年 12 月 31 日的 1,360 萬美元減少 150 萬美元，且截至 2024 年 9 月 30 日，我們的資產負債表上沒有長期債務。

We will now move on to questions.

我們現在開始回答問題。

The first question. Congratulations on winning the trial against Cisco WebEx. Can you provide any color on when you would expect to see any money from that judgment and a date range of when that might be?

第一個問題。恭喜您在 Cisco WebEx 的審判中獲勝。您能否說明一下您預計何時能夠收到該判決的款項以及具體日期範圍？

On October 8, 2024, an order granting a motion for final judgment was entered into by the court and signed by Judge Alan B. Albright in the amount of $65.7 million in connection with the lawsuit. The final judgment was entered in our favor and started the time for filing any post-trial motions or appeal.

2024 年 10 月 8 日，法院作出最終判決動議並由法官艾倫·B·奧爾布賴特 (Alan B. Albright) 簽署，判決金額為 6570 萬美元，與該訴訟有關。最終判決對我們有利，並開始了提起任何審判後動議或上訴的時間。

Next question. In regards to the Newtek Technology Solutions acquisition, can you please explain and give some detail as to what the business specifically does and perhaps give an example of a client and what it does for them?

下一個問題。關於 Newtek Technology Solutions 的收購，您能否解釋並詳細說明該公司的具體業務，並舉一個客戶的例子說明該公司的業務能為他們做些什麼？

NTS provides a range of IT-related services, including managed IT, managed security, managed backup and disaster recovery, secure private cloud hosting, professional services consulting, product procurement services, web hosting and e-commerce solutions as well as implementing technology solutions for enterprise and commercial clients across the United States. NTS delivers secure and compliant services to customers within heavily regulated industries, including financial services and health care.

NTS 提供一系列 IT 相關服務，包括託管 IT、託管安全、託管備份和災難復原、安全私有雲託管、專業服務諮詢、產品採購服務、網路託管和電子商務解決方案以及為美國各地的企業和商業客戶實施技術解決方案。NTS 為金融服務和醫療保健等嚴格監管行業的客戶提供安全且合規的服務。

Thank you. Final question. As a follow-up to Newtek Technology Solutions, it appears to generate significantly more revenue than your prior Paltalk business. But what gives you the confidence it's a business with growth prospects? And are there additional likewise businesses you feel you can also acquire?

謝謝。最後一個問題。作為 Newtek Technology Solutions 的後續，它似乎比您之前的 Paltalk 業務產生了更多的收入。但是是什麼讓您確信這是一項具有成長前景的業務？您認為有其他類似的企業可以收購嗎？

Well, managed cybersecurity and managed cloud hosting are growing rapidly worldwide. We believe the acquisition of NTS gives us the ability to enter the cloud infrastructure and cybersecurity sectors, both business deemed ripe for growth, both organically and through potential accretive acquisitions in the future.

嗯，託管網路安全和託管雲端託管在全球範圍內正在迅速發展。我們相信，收購 NTS 使我們有能力進入雲端基礎設施和網路安全領域，這兩個業務都具備成長潛力，既能實現有機成長，也能透過未來潛在的增值收購實現成長。

Thank you. Jason, back to you to close out the presentation.

謝謝。傑森，回到你這裡來結束演講。

Thanks, everyone, for your support and for joining us today. We're very grateful for your interest in our business. We look forward to updating the market and our stockholders with our progress on our proposed acquisition of Newtek Technology Solutions, Inc., a wholly-owned subsidiary of NewtekOne, which is expected to close by the end of the first quarter of 2025. Have a great day.

感謝大家的支持和今天的參與。我們非常感謝您對我們業務的關注。我們期待向市場和股東通報我們對 Newtek Technology Solutions, Inc.（NewtekOne 的全資子公司）的擬議收購的進展情況，該交易預計將於 2025 年第一季末完成。祝你有美好的一天。

Thank you. This concludes today's conference. You may disconnect at this time, and we thank you for your participation.

謝謝。今天的會議到此結束。您現在可以斷開連接，我們感謝您的參與。