Enveric Biosciences (ENVB)

Sanjay Hurry Investor Relations
Brent Kelton Chief Executive Officer
Viraj Patel Chief Financial Officer
Robert Brezza Northland Capital
Brian Kinstlinger Alliance Global Partners
Call transcript
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Good day and welcome to the Ameri100 2018 Second Quarter Financial Results Conference Call and Webcast. [Operator Instructions] Please note, today’s event is being recorded. I would now like to turn the conference over to Sanjay Hurry, Investor Relations Counsel. Please go ahead.

Sanjay Hurry

Thank you, Rocco. welcome XXXX and results quarter everyone call. conference morning, to second AmeriXXX’s financial Good referenced call and on the release earnings The this page the website. Investor is of AmeriXXX SEC website the Relations on accessible

the Patel, Financial will Viraj hold today Officer remarks, session. question-and-answer their Chief Brent Chief Officer. Kelton, On Executive call and a prepared After management are

to AmeriXXX and future As to implied the limited expect, relate phrases anticipate, differ risks, activity, a statements events or by of these likely, future levels estimate, other may looking or intend, forward-looking that factors to belief, reminder, known activity, this results, plan, such any cause could or materially not expressions future forward call or targets, and performance and statements. and similar results, but uncertainties identify its of and achievements expressed unknown performance or levels may expected involve will, statements. performance achievements contain that Words business of forward-looking from actual as

the adversely and but risks existing to conditions spending qualified are businesses personnel, acquire to conditions new those not demand offers, its that the and risks services around which Future attract in markets the the for the statements concerning to cause its growth its types as other customers ability businesses, its AmeriXXX to and reduce and but maybe highly operates. the specifically market concerning well services, about it of and affected could uncertainties, the performance for create, level fluctuations estimates, company as grow projections market AmeriXXX’s currency ability and for herein, retain financial of following statements and and its to to information common by Forward-looking not plans, of services, industry. intentions, statements beliefs are business the strategies, that mentioned and competitive predictions, market that other our limited world include, market their its build

other detailed with reports a SEC factors the can these investors which review reports website. filed discussion risks, should through AmeriXXX’s and and the SEC accessed of For XX-K Form on be

are no duty All their Go or events, over made beliefs Kelton, at made. to like to said, and are With conference the would on based qualified its Officer ahead, forward-looking are the statements on by of opinions statements the update AmeriXXX to time Forward-looking AmeriXXX. this call information reflect Brent. information future cautionary statements I circumstances. Chief in today’s to turn and entirety that undertakes Brent statement Executive call management’s

Brent Kelton

balance thank I conclude in to detail provide of Viraj us the everyone and before you our quarter. as morning results questions. the to our the our our performance sheet. of to the will taken actions financial joining Sanjay the your for on as well this quarter for call. some close year with on you with with opening I then you, brief Thank thoughts will cleanup will call then a of begin subsequent the remainder out review greater

business an overarching on out growth. you objective For with achievement is organic acquired we maybe which XXXX to model of quarter parts, for year, the this during of unified entered and the deliver that disparate To with company those new establishes the guidance. line the revenue what into our and for profitability in perspective forge of AmeriXXX, EBITDA adjusted one second out most stands our quarter, to profitable a sustainably basis put achievement the is

streamlining we and process, As across focused aggregated on of the reducing integration business. the costs part a

and class supported a delivery also high team solutions by a portfolio. on them We offerings merging selling focused sales our to broadened and solutions dedicating world forces margin

brand our integrated with pipeline discuss a shortly. the made streamlined AmeriXXX office Two single solutions I that operate activities in also later, building back We modest quarters will under organization. investments businesses

offerings growth, high markets. high product digital margin the steady and portfolio cloud and Our market enterprise growth spans

with compensation professional trained results rewards services our are results consolidated of by year-over-year. force revenues. which solid Our The is with operational infinite margin turnaround almost adjusted sales sales plan and our sales pursuits $XXX,XXX the and in solution efforts new lower and execution that second engineered supported in deemphasizes EBITDA margin quarter solution high

solution execution well to manage line SG&A the and top closely sales reduce of impact performance Our demonstrates our costs. on as as strategy our our strategies

this. on me offer Let some color

have we mix solution in the shift of revenue sales focused is First, to a results revenue. more which assets our towards sales solutions

focused those sales people only we revenue The on personnel to personnel low order sales with and organic Second, in QX have mix sales services producing more growth. not that we in plan professional drive we do personnel, solutions QX solution in to removed revenue is margin that revenue, deliberate. and have marginally replaced yet shift but

profitable that can us are additional us more and created our margin high engagements. contracts for maintenance and long-term into Solution convert with sales support opportunities for clients secured relationships giving

consequence, lower quarter, a As margin second the revenue for quarter services resulted lower proceeds the the to in first continued back professional year-over-year in of half we in year. pair which the

for QX as low the second to solution as compared the the partner with a year. through points client revenue of new platform. strategic were and XXX legacy its improved coming of for the S/XHANA margin in quarter mix sustain this this balance in was the infrastructure It in secured sales SAP client XX SAP’s nearly we an in noting professional quarter to the basis of Gross that new we wins S/XHANA of revenue. end services worth year. win rate cloud migration expect we IP of ten six Year-to-date the flatten in to We to have including selected by decline expect one percentage the solution that revenue is shift margin deployment which in product grew

to a We us. be solutions private the cloud win This opportunities are in future environment. holds this for going that deploying is

overall are on we a of partner, to strategic migration well positioned the as projects client additional the path. As bid clouds part

new beverage products. storage announced opportunity. migration our win opportunities. collaboration the This We consumer and noteworthy and one securing was This SAP client is North and demonstrates another leading manufacturer another new American packaging close and food because growing with also it supplier of win in and

with We opportunities also machine of learning called company our Intelligence. machine clients a to at quarter plan, executed capabilities and learning the and in support enterprises extend XX% we on SAP At with simplify when cloud learning a of transformation drive expenses investing very cloud in ability SG&A to our transitions business our is of declined an is engine the Operationally products. the new center digital digital with use as sales transformations the needs to enterprises to us moved SAP’s in a partnership complementary with enterprises machine should S/XHANA, year-over-year. aligns Bayestree to time

and migrate consultancies few other high market to to S/XHANA middle solutions, SAP enterprises as enterprises. SAP demand we of SAP the natural dedicated As hold and the one large advantage

quarter sales With I leveraging Viraj to and your quarter year the then our our back profitability. in financial results before second thoughts of for our this questions. of come the sustained are some the call opening with call review the a publication will now to the over little more the half results, I drive on turn to Viraj? stronger second second detail. we solution will advantage to Patel, CFO

Viraj Patel

you. Thank morning Good everyone.

entities to revenue XX% decrease begin, this this please unlike of the of a Before quarter the due revenue was from same $XX.X due an $XX.X XXXX was of million, Brent To same XX to XXXX charges, to million period reviewing and opportunities. year variance a sales period. emphasis as XXXX our quarter margin the streamline was our margin directly sales margin solutions is non-cash solution high decreased basis $XXX,XXX was of excluding the year amortization compared The for in our has not in in for comparable a professional compared period quarter purpose quarter. $XXX,XXX points shift profit to approximately revenue June a Gross services was second that the The in for fiscal in approximately principally amounted Depreciation sales second a quarter and comparable to the quarter. ago acquisition. SG&A for towards expense with due restructure million note period million for results timing results, as XXXX. period addressed XXXX. ended the period. that low XXXX first less expenses, financial ago Gross stock second XXX result to includes continue compensation $X.X our $X.X on to we for as flat period acquired quarter approximately

various capitalized customer the remind acquired cost. during resulting amortization you, list Just in all higher acquisitions we to of

to reduced quarter was the $X.X or an each expense. $XXX,XXX mainly stock-based returned prior per SG&A second profits As a approximately second EBITDA period. to of and are in of months. adjusted loss expenses $X.X or $X.XX for loss net $X.XX GAAP EBITDA GAAP as in the for compared $XXX,XXX reminder, these quarter of loss compared prior basis to per on an million of loss period, profitability the generating of a list amortized in We XX over a lower period the million acquisitions, for share net approximately adjusted share result loss compensation customer

year the project decreased to $X.X improvement to and period $XX.X same June for to variance activities. and period revenues SG&A the revenue with principally months by Turning year was aforementioned came X due ended in the to basis large approximately months home was that of million stock projects flat margin. result for the $XX.X The X $XXX,XXX million excluding last the amounted period. aforementioned amortization decrease XX, sale of million that large of a higher and and carried months for due for product as to compared June XXXX, million, in expenses a restructuring profit points Gross a the Gross XXXX strategies. expense to presence Depreciation ended for the the from year. ago XX, was decreased in at the of XX% solutions compared to is national last $XXX concluded charges non-cash gross XXXX. compensation results the this our X year ago a million retailer approximately $X.X margin streamlining due quarter XXX

earlier, customer As those the list capitalized the XX I and months. acquired we over amortize get we during acquisition lists period a of mentioned customer

a for in for and compensation GAAP result period was share period revenues loss net updated XXXX. as a approximately adjusted stock-based year a loss net to services of of per compared fiscal EBITDA a low corner high-margin ended announcement compared fiscal basis favor attrition assuming $X.XX profit continued the adjusted the profit last period. guidance June sales, earnings for are year was our we or now professional million EBITDA financial share EBITDA $X also $X.XX in today, expect profitability SG&A our XXXX the of our have margin a for adjusted XX, loss $XXX,XXX for in the be or comparable prior lower $XX,XXX With expense. of $X.X of full Our per XX the expenses of we XXXX reduced fiscal on for June revenue the with non-cash we period to GAAP approximately our having And the the profitability year. to million in expectation reaffirming quarter, solution turned second

strengthening Turning and balance quarter. up to balance our during the structure and sheet, we sheet cost on cleaning focus our

upon to about stock, at annual meeting of common our we purchase X amendment. of in First, Management preferred going is promptly approval of the million reduces is be going our The will the holder of issues preferred forward. forward. defaults non-payment This we the expected warrants to following per Subject significantly that XX. savings effectiveness which amendment with to Thursday, shareholders stock Lone in dividend prior respect the of and issuance the eliminates the immediately $X.X shares annual price an all will at exchange a conversion $X.XX exercisable be of August by share. In sole company’s Star X-year cash secured cash cash XXXX Value of held to to the to with on warrants result holders million of this dividend our stock the

filed filings on details be XX. in found June Additional SEC can our

close accredited of through warrants purchase X placement of equal initial our stock share, exercisable per warrants to to an private and of with the investors the we approvals from raised have subsequent common Also The X date price million are and and to exercise placement. price limitations shares of ownership private shares million shareholder adjustment. $X.XX stock agreed initial institutional common Second, purchase – to quarter, issue expire the an $X.XX to subject placement to $X private immediately million we subject a X issuance. and to years the after with common of certain

Additional as details was XXXX. of down cash with of on that July can the quarter our We ended million cash $X.X XX, and the equivalent December and press structure filed of of be found the XX, in placements $XXX,XXX, X-K the from approximately XXXX. releases

balances, tax will or the remainder of the continued working foreign now a of revenue to balance we needs have our year Given year. cost remarks. of and Brent. turn capital my call the for back tight I This projections concludes the the And for resources sufficient over prepared control

Brent Kelton

Thanks Viraj.

half As look we to Viraj of have to and heard you execution drive build the detail. to sales as do growth we success just second XXXX, solution our intend so profitably and

are opportunities And that this our the this a high recognizes solutions growth. with bigger meet following we top in one driving is of deal sports sales revenue through companies. year. we senior are than our team. engagement perspective have to in the recent profile them. consultancies delivery, from noted and exited in a the dozen described attendees very win-win with are gone pursuits actively Sapphire level and unnoticed user unprecedented. Conference, spend SAP I developments new SAP is at the in increasingly our wins marketplace. me and elevated which the few SAP’s a factor that line. the has in world. had is and of more impact We of leadership of are not most SAP market our of remarks our is and It will We one minutes annual sense our very likely few the cloud a be the shaping our we SAP addressable value at top as and that ecosystem adding truly a hope value the companies dedicated piece earlier SAP’s marquee truest significant the dollar best is has Let half now Now industry. solutions to four of the my Sapphire At with equipment value to that the in the ecosystem for within active over and conference, had attendance both This XXX and sales a we partner SAP booth management shortly is XXX apparel discussing One deployments the strategic year pursuits that today won market. on our to brand expanding came recent back announce we over

the Another their to one migrating the one is brand will U.S. recognizable on of the S/XHANA. in and focused most ECC landscape financial services SAP industry in be

of to We support world three one SAP the are cloud. cloud clients’ advanced top migration also with in of the partnership to in to vendors discussions their mutual environments the formalize our

robust that sales second develop first to line We top and secured partnership are our wins development efforts. soon. this is hope am I the that I demonstrates active am to bookings. supplement ten two these in third translating our to quarter. very pursuits quarter with very currently with have in X This quarter solutions developed partner the pursuits Giving and we momentum relationship to-date ability earlier six have I mentioned our pleased in to channels in formalize inputs, to into sales the and we already say the that compared we secured of pleased

winning on technology. the also basis new are of We

and weeks. I these I was solution, clients that well the current mentioned demonstrated in we presented which formally We as prospective already three machine scheduled as have clients learning Two the three demo solution have of additional Bayestree expect to our coming and Sentient add sales earlier to with strategy late pricing the headcount mentioned are people timing sales during QX experienced of QX. our earlier our that strategically to we the and discussions to moving formalized, pursuits solution proof-of-concepts. and solution next for stage

experiencing. will We expect already supplement sales the they are momentum we

our companies While acquisition is Founder, earnings build of the in of in reach received our gives scale flexibility to-date. unique that on Two, it our the the and America with centric market Three, to higher be open quickly as have just clear strategy we compete and more North SAP digital occupy cloud, scale creating therefore business tailwinds to balance profitability undertake projects growth. organic given only growth spoken solution realized relative enhances have migrations of call it will to The of able to it verticals actively target and the enterprise you market and of see In larger its financial better four, geographical M&A partnerships proven M&A the services opportunities and SAP to strategy. Nidhi, power a concludes capabilities. we or from and in the more model focused market new cleanup order to build can fragmented our can the my Operator, remarks. by our initiatives secured us one to the internal beginning of profitable to questions. of are larger business matters the us us business prepared projects those reenergized and foundation summary, enhances just the Greater greater publicly our in clients. and with stable sustainable space to we business focused to relate initiatives. open in M&A provider us to and path a Dev that financial SAP our Led market through And statement solid SAP. SAP with transformation only solutions This and gives the because traded sheet scale we model. a larger for I


Thank you.

Robert go from of comes Today’s [Operator Brezza begin Please will We Capital. question ahead. the session. question-and-answer Instructions] first Northland

Robert Brezza

talked think second when up about are like taking about thinking many the sales maybe Thanks a my lot how a people, or for morning hiring you people add? to questions. expect half about Hi, just great. good That expansion you ranges talk building for Brent, in you about be XX% for gentlemen. you the will

Brent Kelton

the Thanks, and being question on Rob. the Appreciate call.

strategic We to there. are be make looking that additions and we the very

of end very a for in so sales it deals from think we be be X are the towards think before addition it strategic I am least sales, of the will So, the of specific additions first solution to end a that that and X net bring at probably can what net perspective now year. us SAP would couple headcount, between net very year, to geared of about the I talking their

Robert Brezza

Can it. heard call, quarters? it the XX just you give quarter numbers I Got you me the can on – already, deals last for the this two

Brent Kelton

Sure. XX It and X. was

Robert Brezza

Okay, got it.

American perspective, on So seems into you here deals America the the North mentioned an a obviously most of it market geographic or are SAP provider you when in have got like how into put that exclusive of North you about thinking you world? like momentum of etcetera, you lot are and coming these are call

Brent Kelton

That’s And in in a at to those driven is some a being if question, and and we announce obviously there them that hope there of the on American couple and great But between being Middle look have East then specifically announced you in there globally not soon. Asia. pretty Rob. is we split in but yet companies those QX for good specifically North a those those

companies four that that think are are of North of global it’s based is and five American them So companies. and those roughly there XX-XX I

Robert Brezza

do lower the perspective path sales you going here, just XXX on are structure thinking put faster, to about it I I like sale? on what’s you to Okay, you doing what good you the the professional are solution got curious are in solution would you the difference a not looking said delta if if it understand when versus very of maybe it mean your is basically I what margin starting profile, to seems Viraj not basis you if in at versus it. get cost see guys and are professional point, just services are be And to margin the services sure here, kind am profile people for really the perspective

Viraj Patel

So a good thanks question. for

be more the to like obviously reemphasize adjusted we From profitable margin margin just EBITDA So the emphasizing that professional Brent of rest year are services the to of for low business. the do we expect sales had too. solution profile, said,

I margin in at a the comparable quarter the margin, XX-ish the And the business is would there sales have in services profile about solution out a runs that so XX%, last in seen say margin. year this high last XX% we margin, professional is XX% evidently to quarter goes that gets our gross that So compared Brent? as percent to year. amplified little typically,

Brent Kelton

I solution push would would certain add that just even And support deals strategically and Yes. around maintenance Rob, to geared higher. long-term

long-term and Viraj think So particularly stroke new converting even high-XXs good maintenance more consider good average on winning we as gives broad and support into more, can along implementation our migrations long-term I we focused a of those support the XX% maintenance and when implementations works and to margins. with into push

Robert Brezza


and and question you is bigger shift it adding end do at year QX the at stable early next late what deliver is guess? or bogey a of revenue was majority I QX, the we of to mix picture are you last to it questions do this have you be for or bigger people this to making be year think solution one for about going let’s my a call think of stabilized, point thinking where Brent, of sales kind you some the sales or you shifts So in QX as more you of how revenue mix picture services are the about that to component, going say professional transition

Brent Kelton

question. great Sure,

the shift that makes look at sense particular, the next if business throughout would kind to of I really continue least. in think an answer from I year, so organic at organically perspective it

the but it’s through of Like a in – anytime we that we my means to a slowdown, you important mentioned completely by have sort continue shift. in any part the through remarks And amount you see margins decline said, fair not year. would versus an with make the go think soon, I low or the staying and It continue will a business of next period through I time. it. more be to But aligned connected side shift don’t we over with getting just will good to be mix. the we would that, raising going specific like a year. be with feel on will are longer recognize I XXXX, that we close to think this and – that of put solution have a where I percentage I in decline the clients XX-XX that’s slow target re the to so away like

Robert Brezza

Congratulation. Got Nice it. guys. quarter

Brent Kelton

you, appreciate Thank I Rob. it.

Viraj Patel

Thanks Rob.


[Operator Instructions] Global ahead. Brian Today’s Alliance from Kinstlinger comes next Please of Partners. question go

Brian Kinstlinger

job Great transformation morning. business good that’s the the Hi, in rightsizing going on.

someone the you a solution meaning sale selling to you to? then different the selling differently executive there that to gross how the salespeople? decision sales, existing to are that solution person can is drive And higher or some who is to you these about Speaking going margins, retrain are it to makes how are of it you talk higher hard is same market your

Brent Kelton

very the Hey, call. Most question. solutions. Thanks the past that one and I questions lot had today in number we success sales onboard mean, the a Brian. And on have is for experience them Great marketplace. in team of some the selling experienced have being our

may and then of pitch So, successfully familiar and solutions get help from difficult, those them to how to offerings push opportunities. say just I would team need the solution with it’s specific not re-training the pursue our concise portfolio getting really, knowing is really that very the

the selling side, tends certainly it’s base. same then of some be our generally on even case within the shift. IT who organizations some as that people that are large client to to, more cloud There are might the very, if a clients the differences, be would larger more selling to business, far the very have they As or be we

in completely sold example, solution and the being that of for to HR, human portion management So, has cloud-based capital success more SAP, the more been world factors which business.

that lot team our seem just to is with of very a with been branching more IT some they comfortable out of be to side, our the doing team because sales us. the than side business So, has

So, they XX for acquired plus entities years.

on and willing that are they So to willing for challenge sure. take learn to that

Brian Kinstlinger

X the brought or meaning are mentioned You so or people hires in of and hire are last strategic how business new X to more on you sales develop to have many those many guys the plan in business? you team, you to sales X how months guys

Brent Kelton

any XX on primarily on recently. have today and brought we theme the haven’t So, we

team haven’t salespeople to brought year. the any this So, really on new

some the far So team, any we additions but have we done added so… really as rightsizing of as not anybody, have

Brian Kinstlinger

Okay. percentage characterize your but business XX:XX, would of know get I you staff, you today? solutions are to And where versus what want you to as today

Brent Kelton

question. Great

a versus And so today XX% that is almost solution exactly XX%.

Brian Kinstlinger

And where when you were you joined?

Brent Kelton


So, by that’s shifted points. almost X percentage

Brian Kinstlinger

Right, okay.

With have the business? first solution added contracts of average your quarter, the the us deal give since size the that XX either sizes, range you on can of deal you impact can so we understand the

Brent Kelton

You bet.

a question of some in is are or it parts So, note these it’s in East for that clients little bit Asia. I Middle important up or that other Rob’s to India great the of came that question. based think deals And are

those perspective. a India, deal U.S. bit And so in particular are in smaller dollar the from sizes quite

and translates about term the with pretty an that but those bigger will the is also course noting with really of and $XX,XXX initiative big start a million. of that’s anyway that qualify is to say from into $X.X that initial worth of of deals range range some contract, a just So, that’s I time work longer of these anywhere that or from the deals the solution proof-of-concept a contractor primarily anywhere statement it’s or range XX% assessment

Brian Kinstlinger

contract annual value? contract or a That’s value total

Brent Kelton

the contract been initiated. Total of or work and value work statement value signed work of that has taking that’s that a

Viraj Patel

into turn potentially Brian, these Viraj, could some And that get initial it’s of are and large.

Brian Kinstlinger


a would type Some X-year of those where ones maybe the engagement, be engagement. up bigger ones, would XX-day be like to a they initially for smaller

Brian Kinstlinger

are you of Sapphire that And dollar the largest at had, so so mentioned then them, or contracts? might among you one you are was some multi-million have ever – that four from least assume those four

Brent Kelton

four size. the as far as additional of contract are Three

their outline a is starting hundred of off it roadmap. thousand to then into job, one multi-million again initiative do dollar. goes whole turns well, with So we obviously a of couple those And that our dollar

Brian Kinstlinger

Last customer am longer was have get and challenge is bit be business customer, I work a to delivery, what so offshore offshore sometime, from you I the think pushback your am is push the sure? customers question a I years am perspective application, of alluded don’t, even perspective I existing Great. [ph] I SAP a ago XX given maybe what curious a customer which facing they what by in client to still you is and there from if little might mean today that is there maybe from the especially terms of pushback not from curious think then I they any

Brent Kelton

be in To answer client even our your that today, an and that honest be question base, we there. and will pushback capability to expectation see our no world really in

relying in from to important work. our facilities and it’s from literally our our Now very independent, so perspective We people the in visa note model we today’s delivered do not to India. bringing is upon environment that are immigration facilities an here from offshore

is mix engagements as can just a the again cost effectively So at our to all, just it’s we preference, pushback of using no benefit with the going good really do can model the them client that thing offshore consideration. perspective XXX% we on-site as and from a resources but cost all it’s and

Brian Kinstlinger

effort however year the maybe an do I efforts at to be more, or more end you hope was percentage what then year? it’s then one delivered think by looking dollars, and and are where next offshore effort your end of you Sorry it, this perspective, either of from

Brent Kelton


time for would growth the resource mix pretty for remain both. particular the being top which the we and equal the and that in constant it’s future mix to roughly effort foreseeable in closely see is So XX-XX pretty

Brian Kinstlinger

Great. Thanks Brent.

Brent Kelton

Brian. it. I Thanks appreciate


question-and-answer concludes Brent like our to This Instructions] would turn conference [Operator the session. remarks. back We closing for to over any Kelton

Brent Kelton

at you Thank you. for We you look call today. participation our again to very being end and much QX on the appreciate QX. Thank of seeing forward


thank Today’s now conference you, presentation. has you attending all sir. And thank today’s And for we concluded.

You day. may wonderful lines and a your have disconnect now