Cantaloupe, Inc.

Hello, and thank you for standing by. Welcome to Cantaloupe fourth quarter fiscal year 2024 earnings conference call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask the question during this session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. I would now like to turn the conference over to Magna Mirra. You may begin.

Thank you, operator. Good afternoon, everyone. Welcome to the KAMPLO fourth quarter earnings conference call. With me on the call today is Ravi Venkatesan, Chief Executive Officer and Scott Stewart, Chief Financial Officer. Before we begin today's call, we would like to remind you that all statements included in this call other than statements of historical facts, are forward-looking in nature. Actual results could differ materially from those contemplated by the forward-looking statements because of certain factors, including but not limited to business, financial markets, and economic conditions. A detailed discussion of the risks and uncertainties that could cause the actual results to differ materially from such forward-looking statements is included in our findings with the SEC and in the press release issued earlier today. Listeners are cautioned to not place undue reliance on any such forward-looking statements, which reflect management's views only as of the date they are made. Cantaloupe undertakes no obligation to update any forward-looking statements, whether because of new information, future events, or otherwise. This call will also include a discussion of certain non-GAAP financial measures that we believe are useful for, among other things, evaluating cash flow operating results. These non-GAAP financial measures are supplemental to and not substitute for GAAP financial measures such as net income or loss. Details of these non-GAAP financial measures, a presentation of the most directly comparable GAAP financial measures, and a reconciliation between those non-GAAP financial measures as well as the most comparable GAAP financial measures can be found in our press release issued this afternoon, which has been posted on the investor relations section of our website at www.cancelloop.com. And with that, I would like to turn the call over to Ravi.

Thank you, Meghna. Good afternoon, everyone, and thank you for joining us today for our fourth quarter and fiscal year 2024 call. I'll start with a high-level view of our Q4 performance and cover financial and operational accomplishments from FY24. I'll also touch on FY25 strategic priorities before turning it over to Scott for a deeper dive into the numbers and our FY25 guidance. Q4 financial highlights. It's been a strong year for Cantaloupe, capped off by a solid fourth quarter. Our total revenue increased 13% compared to FY23 Q4, to $72.7 million, driven by a 16% increase in transaction revenue and a 14% increase in subscription revenue compared to FY23 Q4. Adjusted EBITDA for Q4 was $7.5 million, a 19% decrease compared to Q4 FY23. Note that Q4 FY23 included a $1.5 million benefit through one-time items which Scott will elaborate in his section. FY24 financial accomplishments. From a financial perspective, FY24 revenue came in slightly below our guidance at $268.6 million. Adjusted EBITDA came in strong at $34 million, an increase of 91% from the prior year. During FY24, we succeeded in our strategy to expand operating leverage by driving recurring revenue growth while also optimizing cost of sales and controlling operational expenses. We have continued to make progress on expanding our gross margins. Total non-gap adjusted gross margin for FY24 was 38% compared to 33% in FY23. More significantly, we've extended our revenue per connection by 11% from $174 in FY23 to $194 in FY24, which reflects the impact of new products and features we've rolled out that allow our customers to sell higher ticket items through our points of sale. We are proud of the progress and accomplishments in 2024 and excited about the fiscal year 25 outlook of 15 to 20% top line growth and approximately 40% adjusted EBITDA growth at the midpoint of our guidance. As a reminder, this is on the heels of 80% adjusted EBITDA growth in FY23 and 90% growth in FY24. Scott will discuss this guidance in more detail shortly. Now on to our FY24 operational highlights. Our investments in improving internal controls have paid off, and as a result, we've remediated all the material weaknesses we reported last year. We've been successful in accelerating our growth in micromarkets and the penetration of seed software with existing as well as new customers. On the domestic side, in Q4, we saw continued success with competitor replacements and customers electing to go all in with Cantaloupe on payment devices and seed software services. Some examples are we continue to see customers upgrading vending machines in the field to cashless payments more and more as operators seek to be 100% cashless and are looking for a single provider. For example, Pepsi Mid-America, Continental Services, and Peppy Foods in combination added close to 4,000 catalog devices in Q4. Akers Vending went all in with Cantaloupe, securing devices, the complete seed prosuit, markets, and delivery platforms, along with upgrading micro-market kiosks onto Cantaloupe Go. We continue to expand our reseller and distributor channels, specifically noting our newest reseller, Vending Concepts, who secured over 1,100 Cantaloupe devices in their very first reseller order. With our focus on our micro market and smart cooler growth, we've been able to extend these services and solutions into other verticals as well, consistent with our vertical expansion strategy. In Q4, we saw penetration into the residential space where we focused initially on the west coast and secured 17 new locations in one quarter. We continue to see nice momentum here as we build the pipeline going into FY25. We are also experiencing further penetration of the Cantaloupe One platform, our first to market platform as a service offering that enables self-service operators to eliminate upfront capital expenditures. This offering has enabled us to penetrate the SMB segment better, and we are now seeing demand for Cantaloupe One with enterprise customers in Latin America. We are also gaining traction with our international expansion efforts. Decorum Vending, a vending operator in the UK, completed their initial rollout in Q4 across their vending machines, servicing the high traffic, transportation, and travel sector. Declan Sewell, Managing Director with Decorum Vending, noted, partnering with Cantaloupe not only streamlined our operations, but also significantly enhanced our bottom line. This is a testament to how Cantaloupe enables operators to manage their business more efficiently. We've accelerated our micromarket solution in the UK region with recent commitments from more vend, new vending, to place additional market locations. We were also pleased to be recognized as the best micromarket service at the annual Associated Vending Services Conference in Croatia in June, which is voted on by customers in the industry. And in Latin America, after our completion, of internationalizing SEED for Mexico, we've onboarded several new small business customers in Q4, leveraging the SEED Entrepreneur Edition. Moving on to our new sports and entertainment vertical. In Q4, we've signed a new deal with the Detroit City FC at Keyworth Stadium to be the exclusive point of sale platform for all soccer games and live events at the stadium. The Detroit City FC are the first professional United States soccer team, USL team, to leverage the Czech POS platform. We've also finalized rollout plans for the Sioux City Explorers Baseball Club and the Campanelli Stadium to implement our full POS solution. In terms of products and enhancements, we continue to see adoption and customer satisfaction with our add-ons released in FY24, specifically with products like Seed Pick Easy, our mobile warehouse picking solution, where we signed on multiple new customers in Q4, and Seed Analytics, an add-on service for our Seed Pro customers with advanced dashboards and reporting inside of Seed. For example, Pepsi NACARD, Highline, not only committed to upgrading 43 micromarket kiosks onto Cantaloupe Go, We're also signed on for seed pick-easy, seed analytics, and remote price change, expanding onto our full product line. We are proud of the progress we've made in FY24, and we'll continue to build on this success and momentum in FY25. Now turning to FY25 strategic priorities. We've made steady gains internationally, specifically in Europe and Latin America, as I just discussed. We are expanding operations support in these markets to allow more rapid scaling and will continue to refine our go-to-market strategy with both direct and indirect channels to expand our customer base organically as well as through strategic acquisitions. Our international strategy will now be enhanced with the acquisition of SB Software, which we announced earlier this week. SB Software is a recognized leader in the UK and Ireland with approximately 30,000 subscriptions and its trusted enterprise-level solutions. The acquisition of SB Software positions Cantaloupe as a leading provider of vending management solutions in the UK and broader Europe, significantly expanding our market reach and service capabilities. SB Software's VendManager and CoffeeManager software complement Cantaloupe's existing product offerings providing an even more comprehensive suite of solutions tailored to the unique needs of the European markets. We are thrilled to welcome the ASP software team to the Canalog family. Beyond international expansion, our strategy to expand into new verticals has also had good initial success. As I mentioned previously, we are gaining traction with residential apartment complexes, car dealerships, amusement, and gaming vendors as well. Our acquisition of CHEC earlier this year allowed us to enter an important new vertical, the sports, entertainment, and festival sectors with a comprehensive suite of self-service solutions. We just launched our new stadium suite solution where we've seen early success working with one of our Miami partners to dial into the needs around suite management in stadiums and ensure that we are providing a solution that can both be sold independently and in conjunction with our full POS and Check platform solutions. We also just completed a record-breaking turnout at a three-day food and music festival in Seattle, where Check served as the official POS solution, processing over $6 million in transactions across 400 points of sale, which amounted to 315 transactions per minute. We plan to leverage partnerships to expand more rapidly. A great example of this is our newest partnership with AIR, Automation in Retail, a company that provides complete automated retail solutions for hospitals, malls, airports, and more, leveraging Cantaloupe as a one-stop shop for cashless payments, point-of-sale technology, cabinetry, and single invoicing solutions for their clients. We placed our first set of locations in Q4 within the UK market and have continued growth plans across Europe and the United States with AIR. Another example of continued partnership is with MasterCard, who are participating in our Cantaloupe Advantage program, a digital advertising program across our digital POS screens, where we will work together to promote their Priceless Planet campaign using our digital advertising services. We recently released our 2024 Micropayments Trends Report, where we analyzed data across 600,000 food and beverage vending machines and amusement and gaming machines, along with 13,000 micromarket kiosks. The report showcases a continued push by consumers to pay cashless, noting that at food and beverage machines, 69% of all machine sales are now cashless. More importantly, the average cashless transaction at an amusement machine is nearly seven times that of a cash transaction. We continue to see micro-markets excel in driving average spend, 37% greater than traditional vending machines. Cantaloupe continues to benefit from these secular trends and the demand for self-service solutions, which will fuel our growth in FY25 and beyond. In addition to consumer preferences shifting towards self-service, as well as the efficiency of operational efficiencies from cashless payments, we are now seeing a new trend of customers in retail preferring our solutions to tackle the problem of retail theft, which opens exciting new possibilities and expands our addressable market. Finally, as always, Thanks to the entire Cantaloupe team for their hard work to drive these results. I'm looking forward to continuing the momentum into FY25. And with that, Scott will now review our Q4 results in more detail, as well as our outlook for FY25. Scott?

Thanks, Ravi. As Ravi mentioned, we delivered another strong quarter. Our Q4 24 revenue was $72.7 million, up 13% compared to Q4 23. Our combined transaction subscription revenue grew 15% to $61.1 million during this quarter. This includes $19.9 million of subscription revenue, a year-over-year increase of 14%, and $41.2 million of transaction revenue, an increase of 16% compared to Q4 23. The overall increase in transaction revenue was driven by growth in active devices and higher average ticket sizes. Subscription revenue growth was largely driven by the increase in active devices, strength in our micromarkets, and our Cantaloupe One program. As of June 30, 2024, we had over 31,000 active customers and 1.2 million active devices, an increase of 10% and 5% respectively compared to the prior year. The average revenue per unit for ARPU for 4Q24 was $194, up 11% from prior year period. As a reminder, this is defined as our total subscription and transaction fees for the trailing 12 months divided by average total active devices for the same period. Our equipment revenue was $11.5 million, an increase of 3% compared to Q4 FY23. Total adjusted gross margin for the quarter was 37% compared to 40% in the same quarter last year. As Robbie mentioned, Q4-23 benefited from certain one-time items totaling $1.5 million. These benefits included a transaction processing rebate and an equipment cost of sales benefit. Without these items, adjusted gross margin would have been relatively consistent quarter over quarter. Subscription and transaction adjusted gross margin was 43% versus 44% in the prior year. This decrease was driven by the one-time benefits previously mentioned. Adjusted gross margin on equipment revenue for Q4 24 declined to 7% from 21% in the prior year. We had outperformed our equipment margin goals in Q4 of last year and have since seen it normalized. Total operating expenses in Q4 24 increased slightly to $23.6 million compared to $22.3 million in Q4 FY23. Net income applicable to common shares for the fourth quarter was $2.2 million for $0.03 diluted earnings per share compared to net income of $2.8 million for $0.04 diluted earnings per share in the prior year period. Adjusted EBITDA was $7.5 million in the fourth quarter compared to $9.2 in the prior year period, a decrease of 19%. The year-over-year decrease relates to the previously mentioned one-time benefit of $1.5 million. We ended the fourth quarter with cash and cash equivalents of $58.9 million. Now turning to our fiscal year 2025 guidance. Based on what we see today, we expect the following. Total revenue to be between $308 million and $322 million, representing growth of 15 to 20%. We expect transaction subscription revenue growth to also be in the range of 15 to 20%. We expect total U.S. net gap net income to be between $22 million and $32 million. adjusted EBITDA to be between $44 million and $52 million, and total operating cash flow is expected to be between $24 and $32 million. Lastly, I'm pleased to announce we have significantly improved our internal controls on both the business process and information technology side, which resulted in the remediation of the material weaknesses we reported last year. With that, we'd like to turn the call back over to the operator for the Q&A session. Operator?

Thank you. Ladies and gentlemen, as a reminder to ask the question, please press Start11 on your telephone and then wait to hear your name announced. To withdraw your question, please press Start11 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Chris Kennedy with WEM Blair. Your line is open.

Yeah, good afternoon. Thanks for taking the question. Can you give a little bit more color on the sub and transaction revenue guidance of 15% to 20% relative to your prior initial, I think, preliminary outlook of at least 18%? Sure, Chris.

Thanks for the question. So our guidance is 15% to 20% initially when we revised our guidance back in third quarter of last year. We said 18 plus percent. We're right in the mid-range of where we said in the previous quarter.

Okay. Okay. And then can you give us any additional color on the mix, the subscription growth versus transaction growth as we look into next year? Thank you.

Yeah, sure. So as we mentioned also in our previous quarter call, we're expecting subscription revenue to be in the 15% range. And then on the 15 plus, and then on the transaction, we're expecting that to be in the 18 plus range.

Okay, great. And then just one last one on SB, the acquisition of SB software. Can you talk about kind of the strategy there and the opportunity to add payments and kind of the timeline on that? Thank you.

Yeah, I think you kind of hit the nail on the head, Chris. It's primarily a software business, and it's got a nice expanded reach and reputation in the European market and the UK and Ireland market. So it allows us to now cross-sell our cashless payment acceptance devices and other software add-ons. So it's a nice kind of set of synergies, as well as our micro-market solution. You know, we've kind of acquired some additional product modules like the coffee manager that was mentioned in the release, you know, which is unique and differentiated in Europe, as well as opened up opportunities to go to several new customers and cross them.

Great. Thank you. Thanks for taking the questions.

Thank you. Please stand by for our next question. Our next question comes from the line of Josh Nichols with B. Rowley. Your line is open.

Yeah, thanks for taking my question. I know the 4Q revenue came in a little bit late, but still a very significant step up when you look at what you guys have achieved last quarter. I'm kind of curious, like expectations since we're largely through the September quarter now. In terms of cadence and the traction you're seeing, do you expect the type of trajectory that you saw this quarter kind of continue into the September quarter? Or how do you see things playing out as we think about the year and how that's starting off so far for the first two and a half months?

Yeah, I think, Josh, it's worth adding a little bit of color to fourth quarter. We did see transaction revenue come in lighter in the month of June. Frankly, we were concerned about it, but as we've monitored those trends carefully, it looks like it really might have been weaker consumers pending in that one month, but not a trend because July and August have since been more to the typical longer-term trends that we've seen and strengthened since then. Translation, you know, we have not seen any of that weakness continue into fiscal year 25, and we've talked to a number of people, including analyzing some small business reports from our acquiring partners and other payment acceptance players in the industry, and it does look like there was some weakness in consumer spending in June, but that has not persisted as a trend.

Thanks. Just curious, like, in terms of the SP software acquisition makes makes a lot of sense in terms of the European exposure. As you like into that, is that more of a technology acquisition? They had like 30,000 customers, but I'm just kind of curious that like a material revenue contributor to this coming fiscal year or not.

It's more technology acquisition and something that opens up a ton of cross sell opportunities. You know, from a From a financial impact perspective, it is not material. It's less than a percent of our revenues in EBITDA.

Scott? Yeah, that's exactly right. We're anticipating to be a little bit less than 1% of our overall total revenue for this year. But to Robbie's point, I think there's lots of synergies with our operations over in Europe that we can recognize over the next year and beyond.

Perfect. And then last question for me. It looks like You are affirming that you do expect a nice acceleration in growth specifically for subscription and transaction fee revenue for this year, up around 200 bps at the midpoint relative to the 15.5% or so growth you did last year. I'm just curious, can you help provide a little bit more detail in the breakdown of what's driving that? Is it some of the existing customers, more of the international expansion, micromarkets, if you kind of opine on that for a minute or so, that'd be helpful.

Sure. I think you just said a lot of big topics there, Josh. So overall, we are anticipating growth in international. We've been working at that for the past several years. We're starting to gain traction in Europe and in Latin America. Candle Oak One is very popular in Latin America. We talked about a deal that we closed recently. this past quarter where we did almost 4,000 cantaloupe one devices and we expect that to continue growth in Latin America and then micro markets are also doing performing very well here that they're growing the pace a little bit faster than the legacy cantaloupe somewhere in the 25 to 30 percent growth range

Yeah, a couple of things I would add are, you know, we signaled, you know, I think two quarters back that we do see subscription revenue starting to reaccelerate, and you've seen now evidence of that in the fourth quarter results, right, the reacceleration of subscription revenue. So that trend, as you project it out, you see, you know, where that gets us into kind of the 15%, you know, growth rate range. It's lower than our original aspiration of 20% growth rate, but it's still healthy and it's still re-accelerated and now we have a lot more data points and a lot more confidence and I would say a lot more risk off the table around that. On the transaction revenue trend, it's been driven by both what we've seen in terms of ticket sizes increasing but also in terms of the micro markets becoming a bigger and bigger portion of our business. So I'm personally very excited about the growth in micro markets and the growth in smart coolers. And now the latest product we've launched called Smart Stores, which takes aim at retail theft and has been very well received in providing an alternative to locking up things in a traditional retail store where it creates consumer friction. versus here is a smart product where consumers can tap a card, open something, and take the product they need and leave.

Perfect. I'll hop back in the queue. Thanks.

Thank you. Please stand by for our next question. Our next question comes from the line of Gary Prestopino with Barrington. Your line is open.

Hey, Scott and Ravi. A couple of questions here. First of all, with SB, is there anything in their software that you have to change for them to start going into, for you to take it into the European continental market? I mean, you basically are saying it's just Ireland and the UK, and I was just wondering if there's an issue there, or is it just a manpower issue that they couldn't go onto the continent?

So they have a limited presence in continental Europe, but you're exactly right. It's a small company, and they intentionally focused on mastering what they do within the UK and Ireland market while localizing and translating their software product to be ready for the continental European market. Now as part of a bigger, broader company, which is Cantaloupe and which you know, more strength in sales and marketing and distribution channels, that opens up the avenue to take it across continental Europe as well.

Okay. That's good to hear. And then, Robbie, in terms of, you know, throughout most of fiscal 24, you were having issues with implementation because of manpower. Has that alleviated itself? And I'm specifically talking about your new wins in Europe.

Yeah, well, nothing alleviates itself, but we've done a number of things and, you know, deployed a number of strategies to actually bring that back into normal trends. And so, you know, in Q4, we did reach a point where the implementation cycle is now resumed, you know, where it was earlier.

Okay. And then just lastly, I don't have the numbers in front of me, but You know, over the last couple of quarters, you showed some really good margin expansion on the gross margin for subscription and transaction or license and transaction revenue. It doesn't appear that that occurred in this quarter, even with the – you back out the non-recurring item. Was there some – was that just a function of what you said that June you started to see some really – some – slowdown in consumer spending, and that impacted the gross margin. I'm just trying to get an idea of what actually transpired in the quarter that would have impacted that margin.

Yes, sir, Gary. So overall, our margins for the fourth quarter are pretty much in line with where they've been for the past three quarters. And you've seen margin expansion over the past three quarters. And just to To give you some numbers, how we compared to last year. So last year our transaction margin was around 16%. This year for FY24 we increased it to 21%. Subscription margin went from 87% in 2023 up to 89% in 2024. And then equipment revenue went from less than 2% in 2023 up to 7% in 2024. So our total overall adjusted gross margin from 2023 to 2024 and went from 33% up to 38%. So we've had throughout 2024 margin expansion and fourth quarter is right in line with where we had been for the past three quarters. Okay, thank you very much.

Thank you. As a reminder, ladies and gentlemen, that's star 11 to ask the question. Please stand by for our next question. Our next question comes from the line of Mike Lattimore with Northland Capital Markets. Your line is open.

All right, great. Thank you. I guess just sticking with the gross margin topic, so should we assume that then gross margin is relatively stable going forward? Is there more room for expansion?

Yeah, so I would say on the transaction side, we've been working hard to increase our take rates until lower costs. I think there's still a little bit of room for expansion there. I think as it relates to the subscription fee margin, we've been in that 88% to 90% range. I would anticipate us staying within that range. On the equipment side, our aspirational goal has been to be between 10% and 15%, and that's what we're going to be pushing really hard for in 2025. Got it. Thanks.

Bobby, when you said the implementation timeframes back to what it was, can you just quantify where it is now relative to, you know, the past patterns here?

Yeah, you know, the long-term trend has been that for most of what we do, we are able to implement it between sold and, you know, installed and activated in a six-week timeframe. And we've sort of seen it come back to those. Now, when it was elevated in between, it was sometimes as high as four months. And while the exceptions still take longer, now the broad majority has started coming back in life. We have deployed a lot more of our own installers and services that we charge our customers for, as well as made some technological improvements to how devices are activated, how micromarkets are activated to make it more kind of drop and click and, you know, or plug-and-play, as my operations head likes to call it. So those initiatives have paid off in accelerating that.

Great, great. And then just last on Latin America, can you talk about some of the growth opportunities there? I think you've won one of the big vending operators, I believe. Is that the key thing this year is just to roll that out, or do you have prospects of winning another one or two big ones there?

I definitely think we have prospects of winning at least one more of the big ones and potentially two. Okay.

Very good. Thank you.

Thank you. Please stand by for our next question.

Our next question comes from the line of George Sutton with Craig Hallam.

Your line is open.

Thank you. Ravi, I wonder if we could step back and talk about the international markets as they stand today. Obviously, you entered both markets over the past several quarters. Curious if you can give us an update on where you want to be. Do you still think the opportunities are as significant as you thought when you started? I don't want to conflate things, but you talked about leveraging partnerships as a new I'm curious if that fits into a large part of that strategy.

Yeah, I'm actually more bullish about the opportunity in both Europe and Latin America than I was, let's say, a couple of quarters ago. And that's based on the following data points. One, we've now seen those markets also open up to but more importantly, the concept of smart stores, right? So think of a smart store as something that solves for fraud, which sometimes the micro market can be a challenge. So you have to put micro markets in high-trust locations. The smart stores can go anywhere, just like vending machines. However, they are more elegant and they are more contemporary and more modern. So I've seen the European market in particular be very receptive to that product. as well as the Latin American market. So that actually opens up, you know, we are able to get into a newer space versus replace competitive technology, which, you know, which is fine. We'll continue to pick up market share in vending machines and in other areas as well. I've also seen a lot of new take in what Europe calls four cores, which, you know, we call gas stations in the U.S., and the convenience stores. That opportunity is has also been tremendous and we start getting traction in those. So multiple areas that give me more optimism and more confidence in our ability to execute in Europe as well as Latin America and also some deeper research that we've done both through primary sources and secondary sources on where the opportunity is, who's making what kinds of decisions and what's the future of self-service in those marketplaces. So all that Translation, we're just way better informed having had boots on the ground and having had initial successes and connected with all these customers.

Great. Thank you. Scott, one question for you on the revenue per connection. So, you know, nice growth up to $194. As you're thinking through 2025 and beyond, can you just talk about where you see that statistic going?

Yes. Sure. We continue to see that increasing. We believe that the average transaction price is going to continue to increase through 2025. There's also new add-on modules that we'll be launching in 2025. Robbie talked about ad management a little bit in his prepared remarks. And so we see that continuing to increase throughout 2025. Okay. Thanks, guys.

Thank you. Ladies and gentlemen, I am showing no further questions in the queue. I would now like to turn the call back over to management for closing remarks.

Thank you, operator. I think FY24 for us has been a year of taking a number of risks that the business faced off the table, including related to weaknesses, material weaknesses around our controls, including the tail end of upgrade cycles with the 3G to 4G, non-EMV to EMV, et cetera, and several challenges around infrastructure and scale, et cetera. I'm very proud to share that on the operational front, all those challenges, including the implementation timelines, which in many ways were tailwinds, have been addressed, resolved, and so I'm really excited and confident in the FY25 forecast as we head into this new phase of growth and profitable growth for the company. I'm also delighted that we've done a lot of diligent work as part of this turnaround to build a balance sheet that gives us the fortress that we need to now be able to expand to new product lines, new verticals, do new acquisitions, and do it in a manner which is low risk and high reward. So with that, I'll conclude the call here, and thank you for your attention, your engagement, and your interest.

Ladies and gentlemen, this concludes today's conference. Thank you for your participation. You may now disconnect.