Mitek Systems Inc (MITK) 2011 Q4 法說會逐字稿

Good day, ladies and gentlemen. And welcome to the fourth quarter 2011 Mitek Systems Inc. earnings conference call. My name is Melanie and I will be your coordinator today. At this time, all participants are in a listen-only mode. (Operator Instructions). Please note, we will accept your questions at the end of today's call.

And now I'd like to turn the call over to Mr. Bud Leedom, Finance Director. Please proceed.

Thank you, Melanie. Good afternoon, everyone, and thank you for joining us for the Mitek Systems fourth quarter and 2011 fiscal year end earnings conference call. With big today is James DeBello, Mitek's President and Chief Executive Officer, and Russell Clark, Mitek's Chief Financial Officer.

Before we begin the substance of today's call, I would like to make some brief introductory comments. Earlier this afternoon we issued a press release which outlined the topics we plan to discuss today.

If anyone has not yet seen a copy of the press release, it is available on Mitek's corporate website at www.MitekSystems.com. Additionally, I'd like to remind our listeners that this conference call is open to the media and we are providing a simultaneous webcast of this call for the public. A replay of our discussion will be available on the Company's website later today.

During this call we will discuss some factors that are likely to influence our business going forward. These forward-looking statements may include comments about our activities, events or developments that we expect, believe, or anticipate will or may occur in the future.

These forward-looking statements are based on management's current expectations and beliefs, and are subject to uncertainties and factors, all of which are difficult to predict., and many of which are beyond our control and could cause actual results to differ materially and adversely from those described in the forward-looking statements.

We encourage all of our listeners to review our SEC filings, including our most recent Form 10-Q and Form 10-K and any of our SEC filings for a more complete description of these risks. A partial list of these important risk factors is included at the end of the press release we issued today.

Our statements on this call are made as of November 14,2011, and the Company undertakes no obligation to update, amend or clarify these forward-looking statements. Whether as a result of new information, future events or otherwise, except as may required under applicable securities laws.

With that, I would like to turn the call over to Jim DeBello, Mitek's President and CEO.

Thanks, Bud, and good afternoon, everyone. We are very pleased today to share with you our results from the fourth quarter and fiscal year end 2011. The fourth quarter marks our most productive quarter ever as a mobile imaging solutions company.

Highlights include penetration of Mobile Deposit into all of the top five US banks. And we remain on track to see our first signed customers for Mobile Photo Bill Pay by year end. We are also very excited about signing Progressive Insurance as our first non-bank customer. And the level of customer interest in our mobile imaging platform has exceeded our expectations.

Fiscal 2011 was an exceptional year for Mitek in which our revenue grew 101% to $10.3 million, during which we signed customer agreements with more than 10 Fortune 500 companies. Mitek is revolutionizing the consumer experience. We've created a new way that can turn every camera-equipped smartphone or tablet into a financial kiosk or commerce platform with a single click.

We believe the market opportunity for this is huge. There are over 600 million smartphones and tablets worldwide. And soon there will be 1 billion mobile devices connected to the Internet. There is probably not a boardroom in America not considering the impact of the mobile Internet on their business.

I would now like to take the opportunity to update you on each of our major product categories. Among our growing suite of mobile imaging applications, let's begin with Mobile Deposit. We believe the adoption of Mobile Deposit is at an inflexion point. The total number of Mobile Deposit signed customers more than doubled to 161 financial institutions over the past quarter, including the signing of one of the nation's largest banks.

This represents a sequential doubling of our customer count from 80 in the third quarter. I am pleased to announce that we have now signed all five of the top five banks in America, and seven of the top 10 US banks. We now have 35 customers that have launched Mobile Deposit, up from 24 last quarter.

Our pipeline continues to grow. And Mobile Deposit has not only become the gold standard technology in the industry, but table stakes for any bank with a mobile strategy. The lines between Mobile Deposit and mobile banking have blurred, as Mobile Deposit has emerged as the killer app.

Recent independent research conducted by Mercatus Partners, now AlixPartners, indicates that 43% of all consumers would switch their primary bank to access mobile check deposit on their phones. Banks see Mobile Deposit as a powerful customer acquisition and retention tool driving their top line revenue.

In addition, AlixPartners now predicts Mobile Deposit of 2.1 billion checks through the retail channel by 2016. All shareholders are welcome to download this study on our new website. Up until now, we have primarily focused our sales efforts on the retail bank customer. As we peel back the onion, a unique byproduct of our success in Mobile Deposit is the growing number of use cases surrounding this application.

We continue to broaden our revenue opportunities by repurposing Mobile Deposit for check cashing, prepaid card top-up, and commercial payments. Earlier, we announced an arrangement with Moneytree through our partner, Cachet, to offer mobile check cashing to the more than 50 million unbanked consumers in the US. This is a completely different market from retail deposit. In this use case, there simply isn't a bank account for deposit.

Check cashing is a big market. Even Wal-Mart has gotten involved with their money centers. These unbanked Americans, however, are not on the fringe of the economy, but often hard-working factory workers, waiters or day laborers. Instead of paying high fees at check cashing storefronts, soon the unbanked can point, shoot and cash their paychecks by loading their funds onto a prepaid card via the use of their smartphone.

For the worker who may have a late shift, kids at home, or two jobs to make ends meet, this provides the ultimate convenience and saves them time and money. Many prepaid carriers serving the unbanked segment report that over 50% of their new handset sales are smartphones. To many of these unbanked customers, this is their primary connection to the world, their friends and their family.

In essence, this previously underserved market has a financial kiosk in their pocket with their smartphone. I'm extremely excited about this opportunity and others just like it. Not only do we have an opportunity to disrupt the check cashing market and provide a real social benefit, we can also offer other value-added solutions to the unbanked, such as Mobile Photo Bill Pay or Mobile Receipt Capture for personal budgeting.

In addition, we are also beginning to tap into the commercial market for mobile check deposits. Again, this is different from consumer retail mobile deposits where we have been focusing our energies. According to the 2010 Federal Reserve study on payments, B-to-B checks make up nearly 30 percent of the 25 billion checks written annually in the US.

The value proposition for commercial Mobile Deposit is different than for the retail consumer, and potentially more valuable. Whereas retail consumers demand convenience, the commercial account desires shorter collection cycles, better and faster funds availability, and less risk. And the commercial customer typically deposits a lot more checks, each one with a greater value. For example, one prospect deposits over 1 million checks per year, each with an average value of several thousand dollars.

During the fourth quarter, we initiated discussions with several large distribution companies to provide commercial check deposit. This feature will allow drivers or salespeople to collect checks at the point of delivery and deposit them immediately to speed collections and increase efficiencies.

We also continue to be very excited about the prospects for Mobile Photo Bill Pay. And we remain on track to see our first signed customers by year-end. Mobile Photo Bill Pay is an application that demonstrates the truly unique capabilities of our mobile imaging technology by not only correcting any image taken by a smartphone, but also by automatically extracting critical field level data without any templates.

Online bill pay users are among the stickiest of customers, and bank executives have told us they believe Mobile Photo Bill Pay is a game-changer for attracting and retaining new customers. With our first signed customers, we anticipate the initial commercial launch of Mobile Photo Bill Pay in the first half of 2012. With an expected average sales price that is much higher than Mobile Deposit, and a significantly larger volume of bills issued worldwide, we believe our bill pay application will be a material source of revenue growth for the Company by 2013.

During the quarter, we also introduced the newest member of our family, Mobile Balance Transfer, a solution which allows the consumer to shop for a better credit card rate by simply taking a picture of their current credit card statement. The underlying mobile imaging technology is very similar to our bill pay product in that we can read a statement, just like we can read a bill, and extract the right information accurately, no matter where it is on the document, and without a template.

This is extraordinary technology and a spectacular product for consumers and credit card issuers alike. Think of it as a shopping app for a better credit card rate. Point, shoot and save. In a very real way, Mitek's mobile imaging solutions are now being used for mobile e-commerce. Highlighting the exciting opportunities that lay ahead for the Company.

The combination of these new products -- Bill Pay, Balance Transfer and other Mitek products like Mobile Receipt -- is a powerful portfolio of products for the financial services industry that we feel requires a direct selling and professional service relationship with the top 40 banks. Many of our Mobile Deposit customers, excited about their success with that product, have contacted us directly to engage with these new products as their mobile imaging strategies proliferate. Therefore, we intend to grow our sales force to take advantage of these opportunities.

Earlier in the year, we also had strong indications that our mobile imaging technology had universal applications to a broad range of Fortune 500 companies. So, we launched our mobile imaging platform to extend our opportunities beyond financial services.

I am pleased that we recorded our first win for our platform in less than four months after announcing the mobile imaging platform. To us, signing a deal with Progressive Insurance this quarter is as eventful as signing JPMorgan Chase as a strategic partner over a year ago. Very definitely, with this deal, we have proven the extensibility of imaging technology to other industrial leaders, and have broadened our mobile imaging technology beyond financial services with this key win.

We are experiencing an unprecedented level of interest in our mobile imaging platform. And we intend to attack this market more aggressively by building a direct sales force experienced in enterprise solution selling, and to handle the volume of inquiries.

At this time, I am now very pleased to introduce Russ Clark, Mitek's new CFO. Russ has been a fantastic addition to our executive team, brings an arsenal of skills and experience, and has hit the ground running. Russ?

Thanks Jim. Before I summarize the highlights of our financials for the quarter and full year of fiscal 2011, I would like to take this opportunity to make a few comments about Mitek's business. Prior to joining Mitek a month ago, I spent the last 21 years working with growth companies in the mobile, enterprise software and analytic spaces, including QUALCOMM, HNC Software, FICO, and Epicor Software. But I have never been as excited about an opportunity as I am about Mitek.

Through my discussions with Jim, the Management Group and the Board about joining the Company, I was very impressed by Mitek's technology, leading market position, and blue-chip customer base, as well as the strength of its management team. I am very pleased to have had the opportunity to join the team, and look forward to helping Mitek continue to grow in this still nascent market of mobile photo products.

With that, I would like to cover some of the financial highlights for the fourth quarter of fiscal 2011 which ended September 30, 2011. Total revenues for the fourth quarter were $3.0 million compared to $1.6 million in the same quarter last year, an increase of 88%, driven primarily by sales of our flagship Mobile Deposit product.

Fourth quarter gross margin grew to 91% versus 87% in the year-ago quarter, primarily as a result of a more favorable product mix of higher-margin mobile products. Net loss for the fourth quarter was $219,000 or $0.01 per diluted share, compared to net income of $180,000 or $0.01 per diluted share in the same quarter last year.

The primary drivers for the small net loss in the current-year quarter versus the small net income in the year-ago quarter include the following. We have continued to invest in the human capital we believe is necessary to address our markets and develop market and sell our products. We hired an additional 13 team members during fiscal 2011, bringing out total headcount to 33.

The board approved a discretionary bonus of $350,000 in the fourth quarter of fiscal 2011 based on the Company's success during the year. The results for the fourth quarter include $380,000 of non-cash stock compensation expense versus $115,000 of non-cash stock compensation expense in the year-ago quarter.

As we continue to hire and retain the talent necessary to achieve our business objectives, we continue to incent and retain our key employees with stock options. And finally, the relisting on NASDAQ during the fourth quarter added around $100,000 in incremental listing and related legal fees.

Now for the full fiscal year 2011. Total revenues for the year were $10.3 million, compared to $5.1 million last year, an increase of 101%, again driven primarily by sales of our flagship Mobile Deposit product. Fiscal 2011 gross margin grew to 89% versus 81% last year, also primarily as a result of a more favorable product mix of higher margin mobile products.

Net loss for the year was $125,000 or $0.01 per diluted share, compared to a net loss of $682,000 or $0.04 per diluted share last year. In addition to the factors mentioned above, profitability in the current year was tempered by the following. Fiscal 2011 included $1,271,000 in stock compensation expense versus only $406,000 last year. During the first fiscal quarter of 2011, the Company recorded non-cash interest expense charges of $384,000 related to its convertible debt.

I will wrap up my comments on Mitek's results of operations with a reminder about the potential for variability in our revenues and earnings. We continue to expect our revenue to remain somewhat lumpy over the next several quarters, reflecting the timing of customer agreements, as well as recognition of revenue under ASC 985.

In addition to sales cycles that can last up to 12 months or longer, our revenue is also subject to variability in any one quarter or year depending on the timing of the implementation of our products by our customers and products, as well as the rate of adoption and usage of our customers' and partners' mobile products by their end users and consumers.

With respect to Mitek's balance sheet, as we have discussed in previous quarters, the Company's capital resources were significantly improved during the year as a result of the $15 million private placement we closed in May. We ended fiscal 2011 with cash, cash equivalents and investments of $16.3 million compared to $1.3 million at the end of last fiscal year.

And we generated around $300,000 of cash flows from operations during fiscal 2011 versus using over $800,000 of cash flows in operations in the prior year. The Company had no debt outstanding at the end of fiscal 2011 compared to $680,000 of debt outstanding at the end of last year.

In order to support any future financing needs of the Company, today we will file a shelf registration statement on Form S-3. This registration statement is not effective and remains subject to SEC review. However, should it be declared effective, it would allow Mitek to register certain securities for a period of three years.

That concludes my comments and I'll turn it back over to Jim.

Thanks, Russ. We had a breakthrough year in 2011. And I am extremely proud of our team that executed our aggressive plan and returned significant shareholder value. As I look at it, Mitek is at the vanguard of creating mobile imaging strategies that help companies engage with their consumers in ways that were not even thought possible a few years ago.

As we look forward to even greater achievements in 2012, we are evolving into a direct selling organization to the top 40 banks and Fortune 500. Large banks now view us as a source of multiple strategic solutions. And as a result, feel it is in their best interest to have a direct relationship.

We are even seeing large corporations create positions, such as mobile strategist or mobile product director, to navigate new ways to leverage this mobile Internet phenomenon. Given our expertise in mobile imaging solutions, and the availability of our new mobile imaging platform, large customers recognize our unique competency in mobile imaging solutions and have been asking for ways to create deeper relationships with us.

As you would expect, we are accelerating our hiring in 2012 and increasing the size of our sales team to meet this demand. We are very excited about these opportunities and others, and look forward to another great year.

At this time, I would like to open up the call for your questions. Operator?

(Operator Instructions)

Bhavan Suri with William Blair and Company

Just a question on reorder rates. Could you give us some color on whether the partners came in for reorders this quarter, and how that looks, given that you had 24 banks deploying at the end of last quarter?

Sure, Bhavan.

As you know, we are at the beginning, what I consider the first inning, of penetration into the banking industry. We are very delighted to have the top five banks sign agreements with us, and seven out of the top 10. Some of those banks are deployed. Most of them aren't yet. It takes them a while, as large enterprise customers, to literally integrate the technology into their existing infrastructure, customize their mobile banking applications, and to deploy to their commercial base. So it's happening right now. And I think even BofA has announced that sometime next year they will be live. And of course we expect the others to follow.

So we are still early. We are seeing reorders from our channel partners who have ordered and are now distributing them, these transactions or subscriptions, to a variety of customers, both large and small. But the big customers yet are still rolling and integrating and will soon be deployed, we believe, in 2012.

Jim, what I'm trying to get a feel for is either the rate of reorders from some of the partners or what kind of transaction level you have seen from some of the guys that deployed early. So whether it's a PayPal or a USAA or USBank. What sort of growth in transaction volume have you seen from those folks, given the little visibility we have to those numbers?

We have seen growth. We can't reveal the numbers that are given to us from our customers, although when they do publicly announce them we can reflect them. And in one case, USAA, they do publicly list them. What we expect -- USAA for example, has over 500,000 active users who are depositing checks on a regular basis. And they claim that they have had deposits well in excess of several billion dollars. This will increase over time. And as we are able to announce that, we will. But currently we are not able to do that and we typically don't reflect that into the marketplace right now.

Could you give us a little color on Progressive, and if you can, the application? But, more importantly, how you plan to charge for that?

Let me tell you that Progressive is very significant to us. And we believe that the products that they will introduce will be strategic to them. However, I will have to defer to them to make their own announcements when they are ready to do so. So I will have you, Bhavan, speak to Progressive directly. And I'm sure they'll give you color on what their applications will be.

And then one final one from me. You've been selling some stock recently. I was wondering if you could provide a little clarity around what you still hold in terms of your holdings at Mitek. If you could just delve into that a little bit.

You bet.

Since joining Mitek in 2003, I have been awarded approximately 2.4 million options. This has been a very important incentive to me, and part of my compensation plan. I remain absolutely committed to Mitek. And I think I've demonstrated that. We've had a stellar year and I think a lot more to come. I haven't sold any shares prior to the 10b5-1. And I am doing some financial planning at my age here.

All options that I have are a 10-year life, Bhavan. And those that were sold under the 10b5-1 were getting a little older and would be the first to expire. So that really is the reason I sold some shares under the plan. I have been authorized by the Board up to a limit of 20% of my holdings. And so currently the 240,000 represents 10%. I have no firm perspective on when additional shares -- when and if they will be sold. But the plan I have filed under the 10b5-1 is an annual plan.

Jim, you've commented about increasing the direct sales force, and expanding that under Drew, I guess. Could you give us a little color on what that means in terms of numbers of folks, or what that would do to your expense line on the sales and marketing side going through next year?

Yes. Let me tell you about that. It's very interesting for us. We are so excited about what's happening out here. This is a journey for us. Because when we launched Mobile Deposit, we initially thought it would be a fantastic channel product. And that has proven to be true. And we've been very successful with our channel.

What's happened and what's new is that these customers are now coming back to us and saying -- You know what? There is a lot more here with our mobile imaging strategies, and if we can do deposits and scale that, and do it securely, what else can we do? So obviously, we've introduced Mobil Photo Bill Pay. We've introduced Balance Transfer. We have plans to accelerate in terms of our introduction of a more robust receipt option program.

So we see that our customers are asking us to have more direct relationships. We will hire more direct salespeople. We are hiring at a rate that we demonstrated through Russ's comments earlier, and we probably will be on that same rate going into this next year, 2012. But the bulk of our hiring will be in the sales area and in client services. That means engaging our customers, managing the enterprise sales process, and then ultimately servicing the customer. Now, as we launch new technologies, and as we extend our platform -- which, by the way, is a very extensible, but there is always new things happening in the marketplace -- we will continue to invest in our core platform. And there may be additional headcount as it relates to some of our technology areas. But primarily our investment this year will be in our sales group and in our client services.

Tom McCrohan with Janney Montgomery Scott.

Quick question on Progressive. I know you can't talk on the timing, but did you mention what specific product or use case they are going to be releasing?

No, I didn't Tom, and I wish I could. But, honestly, we will leave it up to the customer. And they've requested us to be focused on our Business and they will focus on theirs. There is a great partnership that we have built with them, and one that is expanding. So I would encourage you to speak with them directly. They have had some articles written about their intents, and those can be Googled and accessed that way.

Then for the Photo Bill Pay, I think you said the revenue was going to be sometime in 2012. I'm just curious why it's taking the bank until next year to release that product. Just give us some insight into how the process works.

This is very challenging technology, something well within our wheelhouse; and we feel very positive about what we are doing in the pilots today. But banks, they test and test and test. They have multiple silos within the organization that need to sign off on it. It's just the natural course of business. We really feel we're on schedule with the bank, and we will be launching it through their efforts sometime mid-year next year. So we feel very good about our progress with Bill Pay. We think, Tom, that's a very exciting product, and arguably bigger, much bigger, than Mobile Deposit. So we are pushing as hard as we can, but we just have to live within the regime of these larger enterprise customers.

On the strategy of focusing on the strategic, which you've talked about before, and hiring more salespeople, just help us understand how that works to the extent you are selling to a bank that consumes today Mobile Deposit through some reseller. Is a direct Mitek salesperson just looking to maintain that channel partner for the deposit stuff, and just incrementally work with the bank on these other products? I'm just trying to understand how you're managing the existing channel.

I'll tell you, Tom, we are very excited about our 100% growth year-over-year. That's real exciting to us. We continue to work hard to drive that revenue. One way which we think we can do that is to have a deeper relationship with Fortune 500 companies, many of whom are calling us as a result of the publicity surrounding Mobile Deposit. We actually think that we can continue to support our channel for Mobile Deposit, which is our intent, and to supplement directly with these customers with all the other products.

By the way, our relationships with the channel remains very positive. And we feel that all of them now that are in the win column understand our Mobile Deposit technology. But we are moving so fast with Balance Transfer, with Bill Pay, with Receipt and new applications and use cases, that we feel having a direct relationship will accelerate our revenue. And that's really our intent behind this.

And, Jim, a question about the gating factor to all the major banks rolling this out. Because I do agree, it's going to be table stakes. Getting the product out the door technologically does not sound like it's an incredibly complicated process, but I don't know. It sounds like maybe it is more internally the banks struggling with thinking through their overall mobile strategy. Is that fair to say? It doesn't seem like a technological problem for the banks to release this as much as maybe them just having this existing inertia of doing things a certain way and just trying to get all the players aligned to rally around the mobile banking strategy. I'm just trying to understand what the big gating factor is for the banks.

Let me tell you, Tom, it's interesting. First of all, this is a very complicated technology. Although we make it look brain-dead simple to the user -- point, shoot, and deposit, point, shoot and pay. That ilk. We continue to work very hard on the consumer experience when a single snap can actually result in highly accurate data for the bank to conduct a transaction. We've built a model based on a combination of transactions and/or subscriptions that will continue and change and morph as the use cases proliferate. So when we look at a bank, this is a very new area. Banks have only begun now, and other enterprise customers, to look into mobility, and particularly mobile imaging, as a strategy. And that's what we have seen emerge over the past 12 months.

This conversation wouldn't even have happened five years ago, I guarantee you. And I think even three years ago, banks were, and other enterprises, looking to this market and saying, is it real? Clearly the results are in for the market. This is more than real. This is a phenomenon, a historical shift to a computing platform that you hold in your palm or on a tablet PC that you carry. As a result of it, this is a major computing platform. And any business that deals with consumers, or even internally with their own employees, or in B2B situations, need to address the mobile market. As that happens, more and more investment is occurring within the enterprises to hire people with that expertise. And that's not an easy job to fill.

So we are actually sought out as a consultant, as a strategist, as a technology provider that can really enable a better consumer experience. And therein lies a twist. We really treat the camera as an inboarding, or an input device. What we say, use the camera as a keyboard. And as a result, as our customers are thinking about this, and as their consumers are using products like Deposit in greater and greater numbers, they are thinking of other applications. And that's where we come in. So, really, we are responding to market demand. We are responding to the shift in computing platform and our unique domain expertise in the area of mobile imaging. And that's why we think we need to take more control of our relationships with major accounts that will move our needle in terms of our top line revenue growth, not only in 2012 but beyond.

(Operator Instructions)

Jeff Osher, Harvest Capital.

Just a couple of housekeeping questions. What was software versus maintenance as a percentage of mix?

For the quarter, software was roughly $2.5 million, and maintenance was a little less than $600,000.

So pretty flat on the software side sequentially?

Sequentially, yes it was, like I said, around $2.5 million.

And then for customer concentration, I'm sure it will be in your K, but can you break out how many 10% customers, and what that percentage may be?

Yes, we will break that out in the K. I don't have that data right here in front of me right now.

Finally, is it a good way to think about the number of transactions sold into the channel being about 13 million?

We haven't revealed any of those numbers. And we really don't provide guidance at this point, even historical look back on transactions. It's just too early. It wouldn't be a service, I think, to our shareholders at this stage, or to the Company. So we will defer on that question until such time we're ready in the future.

But, Jim, just help me work through the basic math. And maybe this is the wrong way to look at it. But if I look at the midpoint of the number of partners you had in the quarter, it was about 29 as far as deployed banks. If I just look at the 24 ending last quarter, 35 this quarter, which is up sequentially from about 19, if I do the same math with ending Q2 and Q3. If I look at the revenue per partner, it seems to be declining noticeably.

Is that a function of lower reorder rates? Is that a function of maybe your channel partners are just full for the near-term? How should I think about that?

I don't think you should think about that in a quarterly perspective, number one. Number two, it's not declining. And number three, you have to look at the complexion of who those banks are who have deployed. It ranges from very large banks, and very few of those large banks, to very small banks. And, as a result of that, the take rates, the transactions, vary depending on the size of the consumer base into which Mobile Deposit is being offered. So, it is too early, is really the sum and substance of what I want to say to you, to make that kind of judgment. It's way too early. We think ultimately there will need to be a critical mass of those banks who are deployed. And I think, really, what we are looking for in 2012 is to reach that critical mass.

My math says it is declining, though, just for what it's worth. And perhaps I'm thinking about things wrong. But if I take your software last quarter, divide it by 24, that is a higher number of sell-in to the channel than this quarter, which is $2.5 million, which is the number Russ just gave me, divided by, at that midpoint again, 29.

But I will follow up off-line with you guys. Great job, very exciting opportunity ahead.

And let's do follow-up on that because I'd like to clarify that. Because the timing of the orders is something you should note. Pfizer doesn't make orders every quarter, as an example. They'll order big blocks. And we've talked about blocks of transactions or subscriptions, and that is really our model. And then they consume them. They come back once those have been consumed. So the timing is really what you are addressing. I think a better way to look at the Company right now is annually, on a year-over-year basis. But I get where you are coming from, and would be happy to discuss it with you off-line.

Ladies and gentlemen, that does conclude the time we have available for questions. I would like to turn the call back over to Management for any closing remarks. Please proceed.

Thank you, everyone, for joining us today. Very excited about our success and our growth in 2011. We've got a lot of work ahead of us. We have a deepening pipeline and great ambition to drive our top line by aggressively pursuing large enterprise customers, as well as our core banking customers. With the advent of new technologies, new use cases and this emergence of mobile imaging strategies, we feel we are on track to continue this kind of growth in 2012. So I look forward to speaking with you again in a quarter's time, welcome you to our new website, or any individual calls to Russ or myself to take your questions.

Thanks all, and goodbye.

Ladies and gentlemen, thank you for your participation in today's conference. That does conclude the presentation.