Adcore Inc.

Greetings and welcome to the AdCore Investor Presentation Webcast. At this time, all participants are in a listen-only mode. The question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. At this time, I'd now like to turn the call over to Glenn Axelrod of Bristol IR. Thank you. You may begin.

Thank you, Daryl, and thank you, everybody, for joining our webcast today with AgCorp. The purpose of today's presentation is to give Bristol's audience a better understanding of the business through a presentation and then questions with management. The discussion is going to be led by CEO Omri Brill, who is also joined by Yatir Sadat, CFO, and Martin Vanderbilt, Chief Partnership Officer. You'll see the presentation in the webcast. If you'd like a copy and you don't have one, simply email me at glen, G-L-E-N, at bristolir.com, and I'll be happy to send you a copy. We'll break for questions at the end of the formal presentations. When we do break, we encourage questions. And just a quick reminder, we're only taking questions using the web portal. If you're listening over the telephone, please access the web link we sent earlier to ask a question. Remember, you can submit a question using the portal at any time. I'll ask the questions on the air for everyone to hear. and then Armory, Martin, or Yatir will answer. I will not reference any names, but simply read the questions asked. As we have a fairly large audience today, if I can't get to your question online in time and it has not yet been addressed during the call and can be, I'll come back to you by email. I won't read the forward-looking statements, but I do state that they do apply, and I reference them on page two of this PowerPoint. With that said, once again, thank you for joining us. Remember, this is fairly informal, and we do encourage questions to help you better understand the business and its growth path. And now I'll turn the call over to Amri to start his part of the discussion and presentation.

Thank you, Glenn, and good morning, everyone. It's my pleasure to tell you the ethical story today. I truly hope that you're going to like what I have to tell you today. And let's get started. So the next slide. AppPage is going to be a general disclaimer. I want to give you an opportunity of one to two minutes to read the disclaimer.

Hopefully, everybody had a chance to read it.

Time flies very fast, I guess, in Tel Aviv, Israel. And so we are Edco. Edco is a leading AI-powered marketing technology company. The company offers a suite of digital marketing solutions managing and automating digital marketing generally in an effortless and accessible way. The company's vision is effortless marketing. We believe marketing should be effortless and accessible to everyone, and in a sense, we, our engineers, are working very hard every day in order to make the life of our customers very easy make media and advertising accessible and affordable and this is what the company is doing quite successfully in the past couple of years and so some investment highlights when we talk about echo and i know that under the current market condition probably a lot of you asking some very important question when you're looking into company if the company is growing Does the company have a good growth margin? Is it profitable? And basically, if it's a proprietary technology, am I glad to report that basically it could check all these important questions. So yes, the company is fast growing. We achieved 45% revenue year-on-year growth in Q1 2023, and gross profit grew to 35% year-on-year in this quarter. We maintain good margins, 40% margin, gross margin in Q1 2023. The entire year in 2021 was 43%. The company is profitable. The core ethic activity generates adjusted EBITDA of $350,000 in Q1 2023. And if you look at the entire year of 2022, the core ethic activity generates more than $2.5 million in adjusted EBITDA. And the company enjoys proprietary technology. We have all inclusive marketing apps for a complete media journey. And this basically technology allows us to scale our activities to be profitable and give us a lot of advantages and edge in the market. And when we talk about the market, the company actually benefits from a user-addressable market. So online spending is estimated to be more than $900 billion in 2023. And actually, as you see from the right graph, this number is going to grow a lot by 2026, projected to be almost $1.2 trillion. This represents 30% growth over the course of just three years. So what is already a massive market, is growing and becoming even bigger in the next couple of years. When we look a bit under the hood of this impressive number, we actually see taxonomic industry change in our industry. These are two very important graph that basically represent a very big opportunity for ESCO. So on the next slide, we can see the blue portion of the slide is Google in the meta or formerly Facebook market share within the US market. And what we can see that up until 2017, this market share was actually increased to almost 50%. And then since 2017, Up until today, Google and Meta are actually dominating, fading out. Basically, they are losing market share, and these other emerging channels are gaining more and more market share. If you look at the right graph, we can see the same story happen on the geo level. Guys, sorry about the technical issues. Hopefully, everything's going to be okay moving forward. So let me go start again the last slide, which is the tectonic industry changes. So we already understand that the digital ad spend is a massive market, almost $1 trillion in 2023 numbers and projected to be even $1.2 trillion by 2026. But if you look under the hood, we see a very interesting change in our market. So the left slide is basically a market share buy channel in the U.S., and basically what we can clearly see is that up until 2020, 2017, Google and Meta market share was increased. But since 2017, now they are losing market share and other channels are basically gaining market shares on their expense in a way. And if you look at the right slides and we see the same story happen on the geo level. So U.S. is losing market share and other regions are getting market share. And basically, this makes fast forward the world of online advertising in 2023 much more diversified, much more complex. So basically, many other more challenges than just Google and Meta, many different regions that you need to address. And this puts ESCO in a very interesting and strategic position. So in order to, I would say, benefit from this massive change in the market, the company decided to do two main efforts going public in 2019. The first effort that the company decided to do is to extend its geographical expansion or footprint. And basically, since, let's say, one office in 2005, When the company in 2017 opened an office in Australia, in Melbourne, and then once we became public in 2019, we decided to grow faster and opened in 2019 and office in Canada, and then followed by 2020 in Hong Kong, 2021 in Shanghai, China, and 2022, we opened a subsidiary in the US. So basically, the company expanded a lot in the past couple of years, and we are quite happy with the current footprint we were able to achieve. And that actually put us to the second effort that the company decided to do, which is what we call vertical integration. So historically, EdCorp was very good in offering solutions around campaign creation and optimization. We used two special apps developed for it. That's what we call now EdCorp Views. That was the first and the original app that EdCorp developed. And basically, the company was quite good around this specific, I would say, task force in the media generally. But when we look at the media journey, it actually doesn't start with campaign creation optimization and definitely doesn't end in campaign creation optimization. So it actually starts with account creation. And then probably when they need to do media research and planning, feed creation and optimization, if you're an e-commerce website, then you're ready to create your campaign and to optimize them. But then you also probably need to monitor your campaign and analyze your campaign. And obviously, we have financing and budget management as well. So what the company decided to do, that we don't want to give a very tailored solution just around one touchpoint. We want to be able to cater all the different touchpoints. And therefore, we develop different apps that give solutions to the different touchpoints around the media journey. And basically, this puts the company in a much better strategic position, and we can see it on the next slide. So if you look at the right side, we can see, let's say, the advertising world starting in 2007 was quite easy or simple. The client could approach Google directly. open a Google account, and as we see in the previous graph, getting very good coverage because Google was very dominant back then. But then fast forward, let's say five years ago, maybe you needed to also to open a Facebook account. And this, again, going to give you quite a good coverage. But nowadays, everything is far more complex. These multi-channels, obviously, you have YouTube, you have Instagram, you have TikTok, you have Slack, you have Twitter, you have multiple channels, you have multiple regions, and basically for the client to have a direct relationship for every single channel in every different region is quite complex as one can imagine. And this is exactly where ESCO solution comes into play. So ESCO is basically a single access point, so one access point to all the different channels in all the different regions, We have partnerships with all major channels. We operate, as you saw before, in all regions. And this puts ESCO in a very strategic position. And the same story applies to the client's media journey. Again, we now today can give a solution across the entire journey, starting from campaign creation, feed creation and submission, basically monitoring, reporting, analyzing, and obviously financing as well. So basically, very large, I would say, ship in our industry, and ESCO actually is very strategically positioned to benefit from this ship. If we talk a bit about the ESCO technology or the ESCO marketing club, basically, which is our switch of marketing apps, then you can think of the marketing cloud of what Adobe did with their creative cloud. So Adobe put together almost more than 10, for sure, different apps under one roof, which they call the creative cloud. And let's say designers can get access to this cloud and basically utilize any of these tools, whether it's Photoshop and other tools that Adobe has. And ESCO basically wanted to take the same concept and apply it to the marketing world. So with a single access to ESCO Marketing Cloud, the marketer will get access to now more than seven different apps that ESCO has to offer. And equally important, each of these apps give the client a solution for a different touchpoint within the media journey. So when we look at the apps Basically, under the cloud, we can see the following apps. Media Blast, which is an account opening, account budgeting app. So using Media Blast, the client or agency can very easily create a Google Ad account, a Microsoft Ad account, finance this account, allocate budget to this account, and start advertising. So that would be the first step. And then, obviously, if you're an e-commerce website, you would need probably an app like Effortless Marketing that can easily create a feed for you from your Shopify store or e-commerce store, for example. And then, if you need more advanced feed optimization, you can use our Feedico app, which is used for feed optimization, including AI enrichment and other powerful functions. Then, let's say, once you created your account, you finance your account, you created the feed and optimize the feed, the next step will be creating an optimized campaign, and this is when we have the use app. And then, obviously, maybe you would like to monitor your campaigns and your activity, not only your campaign. There are later apps that we developed to help you to monitor your campaign 24-7, your website, your database. So if something goes wrong with any of your digital assets, you will get an e-mail notification to your email, for example. And then 10-book advanced reporting and analyzing tools that we develop, and obviously Oricon as well, which is more performance-oriented type of app that we develop. So you can clearly see that we have multiple apps that give multiple solutions, but a very comprehensive solution with the client media generated. And if you look in an example, our marketing club with like a perfect audience for this type of solution, then we can look at like a potential client, like Princess Polly, for example. And that's a very big fashion brand operating in the US, but also in other markets like Australia and UK and other places around the world. And obviously, as big as they are they're operating more than one channel so they they can do it google activity instagram activity youtube pixel microsoft and many others so this is actually a perfect example because if you remember before like life was very easy let's say 10 years ago maybe one market us and one channel and Google, that's not the case anymore. So again, this type of synthesizer now operates on multiple regions, multiple channels, and they need a solution like the ESCO marketing cloud in order to help them with all these activities. So starting from the feed creation, feed submission, then obviously based on this feed, campaign creation and optimization, monitoring via the alerted app and basically analyzing and reporting via the same lookup so again a lot of activity for this type of client and a lot of solutions we can add them across this journey so if we talk about the company's financial and basically everything that we talk up until now are reflecting with the numbers, and we can see they are reflecting quite well. If you look at the company yearly revenue, which is the right top slide, the black bars, and you can see 2018 was 12 million in revenue, 2019 was 15 million in revenue, 2020 was 23 million in revenue, 2021 was 35 million in revenue, 2022 was 27 in revenue. We see a slight decrease between 21 to 22 because the company took a bit of a strategic shift and decided to focus on more high-margin revenue in 2022 on the expense of low-margin revenue. But I'm happy to report that moving forward in 2023, the company expects to see growth across the entire, let's say, all-important market. So revenue, gross profit, and adjusted EBITDA are expected to grow again in 2023. And if you look at the left graph, which is the blue part, we can see the quarterly numbers of revenue, and this is actually a very good demonstration. Our advertising industry quarters are basically because of seasonality, usually they start slow if you want and picked up, and 2022 was a classic year in this regard. So Q1 was 4.6 or 4.7 almost in revenue. Q2 2022 was 5.1. And then 7.5 almost in Q3. Q4 was 8.7. And Q1, again, in 2023, you can see that it's down from Q4 to 6.8. But actually, when we look year over year, there's a big increase of 45%. So it's a massive start for us for 2023. On the right side, we can see like an empty mix of global revenue. EMEA being the largest region for us with almost 50% of their revenue. APAC is the second largest one with almost 30%, and North America is 23%. But actually, both EMEA region and North America region grew a lot for us in one year. EMEA grew with and established 80% in Romania, and North America grew 61%. So very impressive growth over very few, these two regions. Also APAC grew, but not as much. If you look at the next slide, which is the quarterly breakdowns, and we can see in 2021-2023, the company did 6.1 million in top-line revenue. That's, again, 45% increase year-on-year, so that's quite impressive. 2.7 million in gross profit, 35% increase year-on-year, so again, very impressive. Adjusted EBITDA was 0.1 or 0.3. Under the 50, if we look at the core ethic activity, and working capital was almost 9 million. And the company has also been able to maintain a very healthy balance sheet, As of March 23, the total assets were almost $17 million. Cash position for the company as of March 23 was $7.3 million. And if you can see on the right graph, the company is bearing no debt. So basically, the company is completely debt-free, which is always good to be in the correct market and the correct interest rate. A bit about the cap table and comparables. On the left side, you can see the cap table of the company. So total outstanding shares of 61 million. The most is 19 million, which is 30%, a bit more than 30%. But another metric that is interesting to see is that during the last 20 months, the company purchased and canceled almost 4 million shares. So the company believes that the share price is currently not reflecting good enough the two company evaluation that's why we announced ncip last year we actually recently announced the renewal for december additionally and we continue to purchase the shares for cancellation as long as we believe that the current share price don't really reflect what we believe should be the right company evaluation and if you take If you go to the comparable slide, then we put over there at the company, some big brands that everybody knows, like the ThreadBase, for example, some Canadian company now also listed in the last, like a QT ad, and you can also see for the comparables that basically, again, escrow is undervalued and basically this can be a massive upside for the company or for the share. So, To round up, what is Echo's value proposition and why we believe Echo is such a great story to tell. So, as we saw, there is a tectonic change in the online advertising industry. Google and Emeta are losing market share. This is why both new channels and new markets are there. And basically, what used to be a very simple world, up until 10 to 5 years ago, now become much more complex and diversified. And this complexity is a very strategic opportunity for a company like Estee that can be exactly in the middle and be like an app between the client and the different channels and the different regions. And fast-growing companies, 40% of their yield growth and revenue, 35% in gross profit, good gross margin, and profitable. We have provided technology, suite of different apps and solutions from different task points across the client's media journey. And maybe the most important thing, there's plenty of bedrooms to continue to grow. Bear in mind that Edco currently manages around $1 billion in ad spend. This is out of the number that we remember, $900 billion in 2023 number. So that means almost 0.1% of this asset. So there's massive potential for us to continue to grow, to gain more market share, and I think that's probably the most exciting thing about the company's story. And with that, I can already go to the Q&A session.

Super. Thank you, Amri, for that. And to our audience, again, if you have a question, please use the question text box within the webinar portal. We do have quite a few questions in the queue already, so we'll just get going. So first question, Amri, is other marketing cloud competitors must be using marketing technologies. It seems ad core software algorithms appear to provide a lot of automation. Are your technologies that much more differentiated or unique that you're winning market share?

Yeah, it's a great question.

I would say EdCore USPs are as follows. A, the fact that EdCore has multiple apps to multiple steps or stages in the market generation. a very strategic position because we can acquire clients, for example, because they need the feed optimization tool. Then we reach out to Esco and started to use our feeditor app. But then we have the opportunity to cross-sell and up-sell this client to many different other apps and solutions that we can provide. So we already invested money in this client. And basically, there's no need to invest additional money in basic acquiring, but now we have an upsell opportunity, a cross-sell opportunity. So that, I would say, is one very important USP that the company has. And other important USPs the company has, I would say, is the different Partnerships that we have, strategic partnerships that we have with all the major channels, and basically our footprint in many different locations across the globe. So again, we can give the client an access to, let's say now we want to be in Google China, for example, we have partnerships with Google China. You want maybe to create you in Israel, we have partnerships with you in Israel, and so on and so on. So basically that's another very strong value proposition.

Okay, super. Thank you. Sort of speaking on the same theme, is this service applicable to a new brand launching, and does it interact with an influencer community, or can it take the place of blogging or influence given the reach of automation?

Yeah, it's a great question. I would say the following. We don't have influencer component into the core solution or suite of solutions, but that's, I would say, a separate effort that somebody would need to do if you would like to do it. And with regards to new brands, the answer is yes, of course. It doesn't matter for us if you're a new brand, if you're an existing brand, maybe you're already a large enterprise brand, we have, let's say, different solutions to different sizes of businesses and different apps for every business size, I would say.

Okay, thank you. And again, with the same theme, does this take over the individual function of SEO or for a small company such as a small cosmetic manufacturing company in either business-to-business or business-to-consumer?

Yeah, so... The services or solution the company provided is around paid media. So paid media is not SEO. SEO is organic media. So this, again, is different, I would say, stream within marketing. But, yeah, for all your paid media efforts, they give you a very comprehensive solution.

Okay, thank you. I know in the beginning of the presentation, your intro referred to Adcore as an AI-driven company. The question here is, how do you see AI disrupting the industry and your business strategy and plans? Are you planning on using these capabilities?

So the honest question would be TPC.

Nobody knows yet how AI is going to influence the industry. We do expect, obviously, influence. I would say something that we know for sure, that we use AI as basically an enabler, something that allows us to scale, to give better solutions, and the company is very, I would say, focused on implementing as much AI solution now that we can in the different apps. So for us, actually, AI is a big enabler.

Okay, thank you. Next question. Tell us about a typical customer. How do they use ADCO? How often? For what services? And how much does this typically customer pay ADCO?

ADCO, yeah. So I would give you an example of two, I would say, potential clients or typical clients. And the first one would be actually an ad agency. So an ad agency can look for potential, I would say, solutions for the client, and probably an agency will have anywhere from, I don't know, 10, 20 clients if they are quite small to sometimes even hundreds of clients if they are quite big. And these clients will usually become from multiple industries, let's say e-commerce, travel, region, and will have different needs. So for this agency, probably to manage all these clients manually will be a very difficult task, and they're going to look for tools to help them automate some or all the marketing tasks. And basically, ESCO, because of its comprehensive solution, gives them a very attractive, let's say, solution to their needs. So they can have access to the ESCO marketing cloud, access, let's say, seven different apps within this cloud that basically gets a lot of their day-to-day marketing fully automated. So that's one type of potential client. And another type would be direct advertisers. So that's somebody that is usually, it can be small, but usually it can also be quite big, like Princess Polly in this example. And basically, again, it will have complex marketing needs, and it will look for an technological solution to automate his marketing efforts.

Thank you. Next question. Are you exclusively a demand-side platform and are revenues generated as a percentage of the ad spend by clients?

Yes. So, ESCO is not a demand-side and we're not DSP or anything like that. So, that's more specifically a QTS or a trade this into programmatic. ESCO is mainly doing a paid media. Programmatic can be some of the solution we can enable, but we are not programmatic company in this regard. So we mainly would do probably search campaigns, shopping campaigns, social campaigns to our clients. Programmatic can be another addition to this media mix, but it's not, I would say, the main mix. And with regard to business models, then these business models that is reflected, I would say, is percentage of expense. So that's mainly for do-it-for-me type of clients. And if you're talking about do-it-yourself type of clients, I would say it's more tough, straightforward model. So you have a license fee, and you're going to pay extra for what we call automation tasks. So basically, as you automate more stuff, you would end up paying more eventually.

Okay, thank you. One of these slides covered the regions where you're active, and I have a couple of questions on this topic, so I'll just sort of combine it into one. So first, is there any differences within the regions that drive growth, number one? And then number two, a part of this question is, do you see any particular region that is growing faster, and if so, why? Okay.

That's actually a very good question. I will try to answer it in a few layers. I would say, A, the fact that the company is very well diversified in its geolocation and has a very good global footprint. very it's very good for us because we can see over the years that maybe some during some years some markets have went faster than us other and vice versa so the fast flow is up and doing corporate the epic reason for us was that the big growth like we saw the massive growth coming from this region and then postcode is actually declined and vice versa now postcode we see North America picking up a lot. EMEA region is picking up a lot. So the fact that the company is diversified is actually very good for us, and this allows us to be able to show a continuous growth over the years. So this would be my first response. My second one would be, yeah, let's say over the past year or so, we saw massive growth come from the EMEA region. We saw massive growth coming from the North America region. And I would say the following. A, North America, this is a strategic region for us, and the company put a lot of effort to expand over there. So we recently, in the last year, we opened a U.S. subsidiary. We recruited U.S. sales folks as well. So this is strategic that we put a lot of effort in, and we're still growing quite nicely because of this effort, and that's always something nice to see. And within the EMEA region, I would say, It's mainly going because I would say it's the most established for us. This is number one reason. Number two, there's a lot of new initiatives that we started that actually started in this region and already generated a lot of growth for us and a lot of revenue.

Okay, super. Thank you. We have some financial-related questions, so I'll get into that part now. I know you touched on this topic during the presentation, but maybe expand on it. And the question is, Accor generated cash in 2018, 2019, 2020, and actually generated $5 million in 2020. Since then, it looks like the model has changed. What happened? And what is the fundamental difference now?

Okay.

So as I touched best again in my presentation in 2022, the company decided to take some kind of shift in its strategy and focus more on high gross margin type of customer. And basically this type of shift proved itself in 2022, but as a result, we needed to teach some clients that come with, I would say, that generates historically good cash flow to the company, but wasn't very profitable in terms of merging. We give up these clients in order to improve our gross margin. And what the company expected to say in 2023 is that we're going to continue to grow in cash flow, but to maintain, let's say, the 40% to 50% gross margin, which is where we want to be. So 2022 was a transition in that regard, and 2023 should be back in no box where gross margins are higher. within the, let's say, the design range as well.

Okay, thank you. Another financial question for you are, are your charges always in the client's currency or standard like U.S. dollars? Do you see inflation playing any important role?

Yeah, usually we charge in local currency. So this means that if we serve clients in Australia, they probably would pay in Australian dollars. If we serve clients, let's say, in Hong Kong, they would probably pay in Hong Kong dollars and so on. So this is one. For us, inflation actually is an opportunity because if it's inflation in advertising calls, then basically it's a good thing for us because the company has no debt. So we don't see the negative part of inflation. We can only see the positive part of inflation. So I don't want to, like, I don't know if the Fed listens to us or not, but under the current inflation rate, it's still okay for us.

Okay, thank you. The next question is somewhat guidance-related, so if you can't answer, completely understood, but I'll ask it anyway. In what future quarters do you expect to produce positive after-tax earnings?

Okay, so like we touched before in the presentation, you can look at the build-up of, let's say, the revenue in the quarterly revenues, and I would say Again, this is not the guidance, but this is something that's based on historic numbers, and Q4 should be where the company will become positive in all metrics.

Okay, thank you. Follow-up question on the last point, Amri, is regarding the profitability from 2018 and 2020. Was the difference just the margin profile, or was there something else behind it?

Yeah, I would say a few things. A, when the company became public, we did a lot of investment to expand the business. So we opened a lot of offices from a single office that we have two offices. We have a pre-going public. We decided to open the Toronto offices and two offices in China, greater China region, and another office in the U.S. So that requires big investment from the company. again the company make a decision a decision a strategic decision to expand its uh apps uh apps uh ranges well so from a single app or two apps three three going there publicly now with seven different apps covering giving a very comprehensive coverage of the media journey so okay We went public in order to grow the business. In order to grow the business, we needed to invest money in R&D, in geo-expansion, and other stuff. We also have a new initiative that we call ANPI that requires investment in the last couple of years. All in all, I would say the following. In terms of geo-location or geo-expansion, the company is FPE of what we said today, so we don't expect to see any I would say additional massive investments over there. In terms of APE development, again, we have very good coverage. Probably we're going to continue to invest in R&D because we need to invest in R&D all the time. But again, we achieved a lot over the course of the last, I would say, two to three years as well. And even with APE, which requires a big investment of the company, we have a very clear roadmap to reduce this investment to the bare minimum in Q3 and Q4 as well. So that gives us a lot of confidence in the sense that the company now already did the majority of the investment in a very good strategic position, and now we can focus on growth, profitability, and basically you can already start to see the shift in the Q1 results, for example.

Okay. Thank you. I have a couple of questions on a different topic now, so I'll sort of combine them. So first, can you discuss what Amphi is and your capital investment in Amphi and also the platform's recent growth?

So ARFI is an online education platform that the company opened during COVID. We saw an increase, I would say, demand for this type of solution. It's many years since it offered live online learning, which most of the other platforms don't offer. They only offer a pre-recorded DOD type of learning. A total investment in ARFI is $2.7 million Canadian dollar to date. And what was the last question regarding AFI?

I guess two questions, one from a different individual, one from the same one. Number one is, are you still investing in it? And two is, can you talk about its, I guess, current and potential growth?

Okay. So yeah, we are still investing in Appy, but most of the investment, which was around building the platform, recruiting, let's say, the teacher and stuff like that was already done. And the company has a clear roadmap to reduce, I would say, the monthly benefit rate from the top, which was 120K monthly to 30K monthly in Q4. So that's going to become much, I would say, low investment moving forward, which is, I think, it's a positive news for the company. And with regarding to AAPI potential, it's still a young business. So it's a bit hard to say what is AAPI full potential, but if you're talking about educational marketing in general, then we're talking about a $100 billion plus market, which is a massive market.

Okay. Thank you. I have a few more questions in the queue here, and to our audience, if you do have any follow-up questions or any additional questions, please use the text box to go ahead and ask it now. So next question for you, Omri, is, Are you seeing the current environment in retail playing out in your favor within consumer that is, I guess, stretched with the current economic environment? How is that impacting both e-commerce spend and your business?

Okay, so it's a good question. I would say, first, regarding ethical business, To date, it's a very diversified business. So ESCO is not only serving e-commerce type of clients, although this is, I would say, still probably the majority of the businesses use ESCO, but we also serve travel clients, for example, that obviously have a very big jump post-COVID, for example, Legion clients and other types of clients as well. So that allows it to be more diversified. So it's not very industry-focused in that sense. This is one. With regards to retail specific, what we saw that post-COVID, which was mainly in the first part of 2022, we saw some adjustments. Obviously, client was like a COVID peak or boom for retail online activity, and then So it was reopening, let's say, in the US, Canada, UK, and other places as well. So we saw some declines. We need to do some inventory adjustments and stuff like that. So we saw it in the first part of 2022. But then we saw the second part of 2022 was actually, I would say, strong again and we see this momentum carried well into 2023 as well so i know there's a lot of discussion about about recession and and and other stuff so we said majority of our of the clients that use escrow actually running quite strong and we know doesn't see currently a big impact maybe some clients are impacted in some i would say niche but i would say in general we don't see a massive impact

Okay, thank you. I guess technology-related question for you. With regards to your suite of marketing applications, which of your offerings are your clients utilizing the most, or would you say it's pretty even across the board?

So that's a great question. I would say always the go-to app probably for us, and that's, let's say, the jewelry on the crop is Spidito, which is our field optimization and submitting applications. a platform so i would say that's probably the most used app in our suite but we also see an increase using other apps as well so i would say once it started to use for example filter then it become more easy to convert them to use the procedure to use other apps as well because they already see the value for it they are more open to try other apps and then it become more easy for us so for us it doesn't really matter How do we start the LSA business with Edcore, whether it's spirit or other, because we know that eventually probably we can convert it to become full Edcore marketing cloud user.

Thank you. A couple more questions for you, Amri. You have a comparables table on slide 21. Who would you say within that table is your most direct competitor? How would you distinguish your business between that competitor? And I guess what is the most unique part of your business that separates you? And is there a moat advantage that our audience should be thinking about as it relates to you versus anyone on that table?

Okay, so that's a great question. I would say the following. Like, fortunately or unfortunately, we don't really have a specific direct competitor from this list. Actually, for a few reasons. A, there are not a lot of public companies, believe it or not. So there's a lot of companies or advertising companies, but the public ones, there are not too many. This is one reason. And another reason, I would say, for whatever reason, whether it's a historically reason or other reason, a lot of the companies on this list are actually programmatic companies and ESCO is not doing programmatic. We can allow programmatic advertising for our our clients, but I would say we are not a programmatic company. We do paid media automation, which is mainly Google, Meta, formerly Facebook, and many other types of channels. So it's a different, I would say, solution for different, more comprehensive solution for online marketing.

Okay, super. Thank you. I've got one more question in the queue unless another one comes in, and I'll ask it now, and afterwards we can give some closing remarks. And, again, this question is, I guess, a little bit guidance-related, so I'll let you determine how to answer it. Based on your NCIB share buyback and your current cash balance, is it right to infer that the company's confidence in strong profitability this year?

Yeah, again, like this is like a – forward-looking statement for the entire year, and that's not something that the company usually used to give. But I would say the following. The company, we lost it in both the last earning call and the earning call before when we summarized 2022. We expect 2023 to be very strong year for the company. We expect to be able to show growth across all metrics, Top line, middle line, and bottom line as well. And we are 10-10 with this expectation today. I think Q1 was a phenomenal start for 2023. We saw massive growth across the board. And again, very much in the advertising business, Q1 is the slowest month in the last quarter, so in the year. So being able to demonstrate such a strong quarter gives us a lot of confidence on what one can achieve in the entire year.

Okay, super. Thank you. I did have one follow-up question regarding your apps that came in, so I'll ask it, and then I'll ask you in closing remarks. On average, how many apps do customers use?

That's an interesting question.

I would say the average, and don't quote me on the exact, exact number, is around two. So that's the average. Obviously, there are some clients that would utilize three to four ops. Some of them only use one, but I would say the average now is around two.

Okay, excellent. I think you did a great job here, Amri. Any closing remarks, and then we'll end the call.

No, I think we got a lot of engagement from the audience, which is always great. A lot of very good questions between the people who are listening to what I have to say. and what we have to say about the company. I think like my closing remarks can be the roundup slide, you know, like tectonic change in our industry, which represents a very strategic opportunity for the company. The company is fast growing, good managing and profitable, which is always good, especially under a challenging market condition. For privacy technology, a suite of different apps covering every aspect of the media journey, and plenty of AdWords to grow. So we trust we're only getting started, and we still have a lot of places to grab in the future.

Super. Thank you, Amri. Thanks to your team. Thanks to our audience. And this concludes this presentation. Thanks, everyone.

Thank you. This does conclude today's presentation. You may disconnect at this time. We appreciate your participation. Enjoy the rest of your day.