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GVP GSE Systems

Participants
Adam Lowensteiner Vice President of Lytham Partners
Kyle Loudermilk President & Chief Executive Officer
Emmett Pepe Chief Financial Officer
Call transcript
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Operator

Good afternoon and welcome to GSE Systems Third Quarter Fiscal Year 2021 Financial Results Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. Please note that this event is being recorded. I'd now like to turn the call over to Mr. of President Vice Lowensteiner, Lytham Partners. Adam ahead. go Please

Adam Lowensteiner

Officer September Thank Thank Systems; Emmett joining for for representing Systems quarter the Financial everyone. the are Pepe, us the and you, and good GSE CEO ended Systems. third the Loudermilk, Nick company you for XXXX. us call and GSE of results With on all financial afternoon, XX, Kyle today President today review to GSE of Chief

that anticipate may, forward-looking. meaning than and I statements this Securities risks of used begin, believe, statements and Before reflect XXA amended would XXE the to identify expectations and forward-looking are as course to considered remind will, everyone could and future expressions a are of factors XXXX cause other expect, achievements during like intend, Words of statements of made current concerning we Securities call forward-looking future should, results. uncertainties projected. to the as different statements is of the that be that absence be mean such could, performance are those not actual important of words subject guarantees may to statements not Act are or of statement their These materially events Section within Act the Section and but performance similar and does These not XXXX.

GAAP performance. similarly in Forward-looking These meaningful to regarding and or With Factors forward-looking can encouraged to periodic events non-GAAP in performance believes not A net or new to adjusted of factors, full in call, including update measures Securities revise Regulation GAAP. of are GSE Chief GAAP addition in EPS of provide figures not information should are the other a titled under comparable set read addition Commission, information, uncertainties figures Accepted to Risk now measures these On a company's as recognize section. adjusted to should Officer intend financial these refer like documents these non-GAAP statements, filed superior which Accounting measures with not you of under Loudermilk, to SEC found that measure those risks, reports reconciliation and might does on Investors proceed. the or Exchange be most as GAAP. President please any considered this whether comparable prepared be Solutions. Kyle, For measures income, that, any Management EBITDA, to adjusted the Generally accordance I'd be a to call the turn companies. measures the and EBITDA, discussion Executive for other Principles, that of not measures release. and of otherwise. GSE substitute GSE's performance accordance result and non-GAAP earnings company's may to file Statements G with with of Kyle to in over or directly in supplemental the operational Mr. management forth future

Kyle Loudermilk

the our if my on News agenda the on conference then the release divisions, with Improvement a Thank including Consulting, Training plan also Nuclear an our had drill NITC; Solutions, give down you've To each discussion or Industry known the into and like commentary results. today, of and Performance on segment, as opening today's I'd www.gses.com as also on the status quarter's chance Workforce and our financial Solutions; you, found highlights section. not, XXXX known can under quarter then engineering of Service-based issued we review a do we everyone the recap I copy will third questions. industry, welcome to and press financial questions a Hopefully, detailing as end results of call. will Adam. this then at the website open to remarks our hope call, release GSE's our news a then to a Earlier be Pepe have any overall call financial business. for out but lay at the Software software to and to solutions we results And

macro me the let by overview First, start industries serve, giving particularly a we of nuclear.

at for by industry. nuclear providing be tailwinds industry past what are very our should GSE. result, Nuclear So positive Society out begin underlying that Florida. let's the nuclear the our August, any industry. American conference held the the serious as is for that for the of a it's highlighting trends And it now business year significant Marco This that in Island, working conference, gaining traction. the came of message utility there's If It's largest was unfolding conference

that kicking emanating of is this the will ever goals for power contains more become zero is positivity the trend States to essential United United future at zero fact before moving carbon then, the in speaking, with advance The the that to the result the was produces President conference towards bipartisan moments by Specifically grid a limited off provisions that role recognition as nuclear which as which a a from was infrastructure become the achieving advancing from a the result bill well today, the our by the this. XXXX. power signing bill time Nuclear's the States. carbon of Congress move to and essential call, we a Since carbon that understand XXXX. zero Biden has not just mix carbon-free bill, grid formally

U.S. nuclear signed proposed and on grid and into renewable longer-term power the Jobs the past by spending, to achieving and Bill Infrastructure technologies countries to of We more implementation infrastructure mention including reviews can the law. production the mind to Canada, sure XXXX, and resilient grid are zero strengthening the focusing of for a recently one Bulgaria, In it seeing integral is a carbon-free nuclear moving plants. reactor name bit formerly generation modular in of by next our the quite the Poland, stable the energy of nuclear goal economy advancing decarbonize forward, nuclear towards particularly was net making to generation months, builds. move a exist several that also A If more the lot the independence. and power leveraging bill, to the will supporting energy Kingdom, steps their of is announce countries energy few, small world the which keeping in stable United dollars that new they embrace plans nuclear ensuring more by the while there's In several adopt grid Bipartisan around existing prominent XXXX. decarbonize part from remain the the allocated of a the while power fleet we've seen sector operations an as

power obvious of legislative nuclear yet-to-be-built creating this under that reactors, and aging news billion package exciting power investment retain our is targets forward. carbon-free Energy a sets states advanced power, very being aside also very small of as nuclear factors. reactors. funding reactors. positive a For $X is the threat moving well industry the a invest nuclear down in to incentivize as reasons, GSE to on as robust spend obvious the for resilient for critical modular news the $X grid. On in is goal Department shut plants result, are for facilities aside micro and factor to It for due in to is and modular and of bill small power. utilities billion This and sets reactors It It economic nuclear that

time, credits, carbon to of wind the bill production credits. nuclear point for nuclear of in and is federal This solar received much key a are zero economic ZECs. to the of GSE what why or a as us. American over Law a lifetimes produce are power through is invest is to safely, implementing a more nuclear the the value power, industry economic these invest plants as from zero is the for for recognition geared credit extend allowing the first continuance of power allocated emission creates large key of is extend as there the plants This news by in setup in great power nuclear to towards the power the from Another produced win more level federal produce existing to investment lifetimes those the generation and serving time the and plants through power just Jobs operable these fleet reasons few produce through capital capital investment. and nuclear fleet, known operating utilities a

As extends the news I briefly for good States. mentioned earlier, well United nuclear this beyond

we has economies the by While energy unreliable That wind years and the world is to making, now sources renewable waking themselves. energy momentum towards been decarbonization goals that of carbon-free highly up the and zero to meet inconsistent, gaining years, the the past carbon said, over certain while beyond. therefore, are XXXX solar serious are and of few in press fact in sources global

of secure scrambled make that has As recent a like the countries energy most decarbonize, and China, on colder being answer anymore Germany result, recent price among to and XX% citizens is a keep stream This which nuclear. while natural how recent forward. energy months. gas, to legacy absolutely the secret The in crisis simultaneously weather as coal, uranium to is surprises in moving over the to keep in have oil independent, heat seen and lights solution the countries can notably and even homes sure in energy around include recognition the must not their that equation world driving the in sources economy climbed

is SMRs. supporting software to for technologies world. have majority the over public modular just are been has years. procurement for providing of software new that known GSE and services leading as through NuScale, partnership a years alluded lots SMRs providing we construction help SMRs. and company solve by with also challenges that gaining XX heavily to services all some time, the involved is and the developers been the of in simulation over engineering, NuScale momentum than going involved in are and XXX that of for of Fluor, small I has GSE that's is a reactors, quite one owned One more and SMRs many of

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existing very to technology significant Japan the of This that plants. nuclear has GSE the upgrading and engaged existential power In issues, power environment, has been This north production power. the embracing the reliability energy to clients a had more a as the we United on in nuclear focused commercialization becoming his investing Ontario vocal customer in new goals. to and Kingdom, help national Just Power aggressively options. Canadian with emulator concern. of has an are citizens projects efficiency, also from for becomes simulators at to security goals two the as nuclear for taking there will been U.S. effectively on path Darlington a manufacturing nuclear energy get a directly awarded when latest aggressive were this and the acute SMRs to in Prime contract where this that agreement entering in they to recently nuclear announced as producing Canada enhance from devices. require and country back generation -- priority investment Canada Japan, Canada too relying support to border, carbon their announced Nuclear recently in and they free nuclear SMR of engineering also $X.X of More an Generation's help design, steps running BWXT broadly, meet the power Hitachi and GE very more consistent quarter whereby carbon connected the that means upgrade zero recent has Canada's in In news are are with station. with significant and ensure they decarbonization the have procurement we are Canada is These benefited well contract pursuing to million meet recent into made nuclear a investment how or energy to especially availability digital affordable GSE. Energy get security power, decarbonization and country by regarding benefited examples Minister up using an facilities. at energy directly regards plans

rise new been with well U.K. low-carbon prices by has path gas at a XXXX." natural Exelon Royce the engage the power slow officials being recent Spearheading to million U.K. worldwide. in generated as motivated to forward the for are talks financial fund as as Britain's the safely it with develop nuclear, of heart emissions SMRs significant U.K. the government board implemented. many then there in week slower-than-planned in put to export Group raised Rolls are in carbon publicly seasonally While partnered has nuclear much for power several wind Royce SMRs that about net options a which time technologies has on $XXX be power reported announced of that U.K. renewing combined next and chart the The reach Generation to new that can like technology. ministers to initially to has to last open generation zero over will SMRs low-cost, nuclear customers Limited strategy "nuclear

recently progress which pursuing made Another is example has regards to news of Poland SMRs.

from Poland. in at fuel plants. profile, energy coal plans reactors Cameco and recently strategy, a two deployment six the This producing that Also to power country's achieved. and into the innovation, explore as the desire the of launch are from uranium GE energy with be -- meet Wyoming. that fleet can Given country. will while needed use political a solution constructed In time of to with geography NuScale September, the this same to note, an building entered an at the years should the independent an countries to Canada has deal SMRs Polish of use a to announced for part every of evaluate construct solution the agreement SMRs parties came existing energy other plans the and heavily sources. is has in power be as repurposing MOU three signed NuScale of expressed broader XXXX. of site of potential evaluate accomplished In until generating SMR of green six invest of carbon-free earliest be service a coal the recognized via has implementation at one Poland to their off gigawatts repurposing into the targets reactor, chain a in and coal-fired units. plan of other has to nuclear supply heels Poland the of few U.S. Montana In power Poland aggressive In the to X SMRs entering to according to France, Romania Subsequent the to including nuclear technologies X.X government's all, XXXX, SMR to an units among plans would energy by power. to which be according extensively, some potential

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since Now, experienced news. the let's of dive GSE in some of reported events good third pandemic. which into the the quarter our It's key onset strongest was the

saw that In overdue orders. events. Overall, dynamics market in with solid the third in QX, has improvements our new sequential So and and revenue demonstrated stabilized results and some quarter key year-over-year efficient business produced million the highlighted third our as been also the quarter of management The and net forgiven $XX.X has business cash sheet by which orders. increase the loan PPP new during balance quarter.

pleased higher year's trending with we were While QX. yet from QX pre-COVID new in producing from third quarter levels, not be orders new very at the the are to sequentially and right last direction orders year-over-year

stronger ready we work make demonstrates linger, continue as to still we our strides a starting diversified the of some enterprise third able of from up a This result that each that divisions. results pandemic customers see on delayed all quarter and from the our are to the we to highly and catch finally the While pandemic show impact to in customers emerge our within the when position to are are be pandemic. was a continue

simulators who simulation technologies two environment The by and already This to great the we looking mentioned, win technology end GSE, simulator regards value $X.X for it and the services operate were operating manner GSE this engineering customer at plant how enable technologies conditions. of and leverage using of simulation was which upgrading almost will latest around in their our shows the safe upgrade to to announced plant operations software. rely real to simulators operations, customer, years based training to this these in create as for the our As efficient at most valued upgrades the and utilizing latest as in nuclear us quarter upon This them state-of-the-art experiences contract advanced in how and the win well Canada, those effectively facilities million. understand I plants to is most have events and a optimize technology simulators a two was our customers possible. deliver sophisticated at largest as

upgrades, services plant-specific we the well. our addition information and to balance incorporate design engineers services GSE work as will of come have models they which offer that breadth for new our customer can to with clients upon shows rely plant In the the of to

we are global simulation utility Gas for million was the energy in as accelerating quarter and a going have is towards as and order stable global for This power or strong plant, in transition as partner moving accelerated at customer boost over enhancing remains note broadly modernize to a energy decarbonization to signed which a operations commitment while simulation U.S. This is initiatives Another selected by capabilities only and solution and carbon Arabia. well momentum today. with and shortages to Two key Turbine, was that recently it their Act to based The GSE global simulator the very beyond. order early into zero a in win was systems. $X sector training more simulation gain see utility operator. in the to due significantly for announced a from Jobs for to valued forward and optimize Combined important new for opportunities XXXX order catalysts, solution the power additional highlights first the potential grid the Saudi order of with net new third the large law this costs Cycle a as as committed high and CCGT complete we

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For known engineering as Performance Improvement Solutions. performance, also

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Our this has improved. segment pipeline opportunities clearly overall for

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to Software-as-a-Service solutions. Moving on our cloud-based

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basis GSE Aside of typically very revenue quarterly to ratable a for nature lifetime it software this GSE. for provides, recognizes software from high the margins, also the gross provides XX% recurring over XX% on contracts.

to For convert via making current. customers which for solutions. year recognize maintenance associated our our each sales maintenance revenue perpetual deliver that licenses license perpetual we certain license instances, to over upfront are and with We're push a which ratably necessary cloud-based is this significant and in

didn't area converting We're been a look several selling license cloud-based growth We're this units fantastic. sector recently our diamond level, the if have larger moving clients, the Aspen in in forward. company with interesting will to keep of mention also The and are continuing happy and software discussions We will to with combined be that make to graphical at these whereby software of business. and into segment mining, the revenue their in to our merged pharmaceuticals Aspen this net the rock. is company then in about SaaS petrochemicals, movement I and and Aspen software which could into several part the also a grid simulation offerings called positive refining. business Technology of especially forward our this would modernization in an We're more with manufacturing, a successful Emerson acquire agreements I be new part and revenue high industrial Emerson's technology transformation Aspen. Emerson, Tech new comprise remiss

The news. of demand customers Solutions. certain year-over-year assets. Sales Workforce them GSE there improve Orders XX% industry. and third million from which quarter, second software XX% still over to time a their valuation showing to the performance of strong from compared level we're the the moving quarter and sequentially that with as increases an -- whopping million more from million revenue, which Workforce at $X.X This XXx maintenance on-prem businesses $X.X was potential at from the increase strength low to the importantly, of upgrades $X order of sequentially. is the sure our making as a up power was deal value cancellations our with doing last their customers how year's of More receive software pandemic. highlights their business Solutions stemming help were and workers services. facilities Good feeling now to proposed required having the and and comfortable committed demand to The are the demonstrate really

extremely trends proud a to will meantime, of the which we We're orders industry produce produced further company little able industry pandemic-related will demonstrate up loosen the turned confidence the constraints that events. built the we of confident very the spending years bar believe for of summarize, future. to To any our the the to and proven quarter division do were turnaround the diversified over the coming back While the it to team GSE's positive well we've third see customers the has from and been business company prepare third rightsized the the corner improving need In on unforeseen and to a to few the GSE the I'm bode has and that and has be positioned investors cash benefit at to marketplace. the business signs in are patient lower, broadly past start the have gear quarter. results macro We're that has seeing believe we as model happen flow. resilient

with environment. to highly our The carbon value-added We the rely should to are an have us and essential our industry in and and creating we part customers technology broader ecosystem as zero industry sector. strong relationships maintain of the up industry efficient and safe running for position the well ecosystem their up beat flows we nuclear power workforce more and and us the engineering the the power a the we on the provide generation reputation software business while and clients competition keep assets into

enhance over providing a will goals. proceed. industry to Emmett, partner CFO, third to industry is quarter solutions at said, develop financial please As grid that resilient such who call GSE power achieve the these now continues results. Pepe, the to I'll the to forefront the With decarbonization, and the GSE's Emmett of the review wanting that goals of with turn will

Emmett Pepe

Kyle. you, Thank

growth approximately change million XXXX since sequential due to the since the increases quarterly but to This nearly The Revenue gained improvements to third of increase of the The which to the year-over-year quarter highest quarter on million of XXXX was during revenue performance XX.X% of in and the industry pandemic of Gross as lower segments. our in in upgrades XXXX. with Solutions few quarter in segment three improvements mix revenue site quarter, the million in $X.X $X.X to subsidiaries. was seen as the simulation increase or orders in total Engineering $X.X XX% our of the the X.X% QX total of year the third and million change to key $XX.X in XXXX. quarterly Solutions by quarter XXXX. was part numbers XXXX year. reported $X.X million expenses emerging million focus start third or me million restructuring the of $X.X With margin million highlighted performance DP And increased quarter. XXXX. third year results, to a expenses our Operating year-over-year in XXXX operating in in and the which pandemic. from in is the offset led Workforce let XXXX. engineering second press The and $X.X quarter. change primarily of impairment of release, consolidated to XXXX, from of quarterly profit third QX and quarter third second the due added ago the due million million up revenue. North the engineering Gross True an amortization few and and color affect a a $X settlement gradually in year-over-year orders on of I third compared sequential ago in overall due is customers XXXX, increase costs Solutions was $X.X the my the customers to an quarter charge $XX.X from third second XX.X% the and comments -- highest XXXX. ago in an Workforce in was the QX $X.X and of as second third in of second affected the continues to by excludes excluding years. to driven improve compared power in charges led to the primarily in areas of the in is the were quarter million, a QX improvements total specialized largely can. but restructuring third XX% were company's due the XXXX $X.X larger when revenues prior pre continued of in highest highest reengage in the third revenue of of continued Sequential This new were detail $X.X million Workforce were quarter in QX compared portion of XX.X% in and in Kyle in which the quarter contributed million starting in and services. Year-over-year highlighted in their $X.X subsiding approximately in quarter quarter legal increase Engineering quarter with of the of provide improvements our million profit revenues quarterly of activity new due consulting the and to improvement XXXX quarter business the XXXX total our sequential compared of gross performance of expenses, Engineering quarter. or XXXX the year increased project The of pandemic. since where million to compared to revenue revenue than to $X.X $XX.X was maintenance. XX% and million was of COVID-XX

$X.X Net past be included share XXXX per in employee recorded million third in $X.XX of diluted was diluted Net or quarters loss diluted $X.XX of as third and retention stems other the as credit. of well basic quarter Adjusted $X.X million the loan the share compared recorded in the of of and 'XX per and the of for basic $XXX,XXX recording the million per with in The was quarter $X.XX positive of or XXXX, an $XXX,XXX $XX.X closely income second Adjusted from $X.XX other for of operating quarter in share expect net to credit. compared quarter income positive which loss per a forward. PPP share quarter our the them employee to quarter million QX and compared the totaled line $X.XX income or continue the expenses share The the or in XXXX adjusted second the the quarter loss income in to second retention diluted going million $X.X was which per loss income $X.X improvement XXXX. in third XXXX. million share of monitor of to with a at or was of basic third of quarter of quarter an three We the $X.XX EBITDA $XXX,XXX the in or third XXXX. diluted $X third in loss for forgiveness per the of from XXXX a $XXX,XXX XXXX. $XXX,XXX diluted of

each net adjusted Our and we income improved sequentially strengthen as our EBITDA have XXXX figures in quarter post-pandemic. business

our come XXXX, newer some on in engineering the Workforce to improvement These stability quarters. existing that the the million online to contracts As XX, forward to contracts with backlog attributed of $XX.X backlog levels are and our September performance and Solutions. movement million $X anticipated in in $XX.X was million, in show orders highlights coming

with has million quarter business, $X.X cash stabilized As balance We the credit additional quarters. our and and demonstrate the the in $X the by the in remaining to stability sheet third benefited and in which was improvement coming we $XXX,XXX continue have exited should facility quarter. on lowered million

Our $X.X million capital increased quarter. increased by $X Net prior the the working $X.X cash also from million to second in quarter. million from

In of on our a balance as refunds to million received be future asset reflected sheet. and addition, is $X.X ERC expected periods is in current

now we been approximately the third program the results. million on last As forgiven that reflected been under by the year Protection SBA received has call, has $XX last quarter earnings in mentioned Paycheck the

has been forgiven, As under now loan the was any subsequently also related loan forgiven. interest incurred this

we operating been have our expenses for has conversation the positioned turn business rightsized I'll have and tightly ourselves in we now the periods. stability managed, believe Kyle. to the back As been coming

Kyle Loudermilk

due To the One dynamic rise a Emmett. recent We desire in lack energy to a countries you, to tailwinds we see in is other on on prices will the fronts believe Thank unfold that focus an decarbonization act we interesting longer but provides. GSE two summarize, that forward term, sources. continue to as major strong the the prices the services cost as for electricity for global Okay. shortage that basis on looking energy and the supply, is of being a from rise of to as focus the a a companies becoming have list sources that put seen in has realization in these a uranium result. SMRs price as about they as them and consistent the top and nuclear. news our on of moved cleaner are belief result see the to been means timeline of large probably increases energy of press implementation recent the the nuclear reality put but issues in up the from and is as persist, of also It and believe

who are improved. during We know facilities to that workforce. their and of upgrade services. pushed pandemic on we need that and open table we before work our projects company coming questions, conclude wait and continue for has for a the customers maintenance recent Now months the the back like many we the in definitely that as we and industry has several to call believe for bids I'd of stabilized to upgrades the that Bidding resume to

with this is the we positioned hard do progress. still to is our happy think well significant demonstrates opportunities timing very quarter business share While believe win we that of with structure. and the which a cost to GSE fair on pinpoint, leaner We're

essential heavily as we of in long-term a our substantial questions. Given that industry, provider With power to create our value. sector the decarbonization to open the the remain and nuclear situation confident tech-enabled services please for operator, unique power floor very ability but said, very

Adam Lowensteiner

instruct for please ask questions, Operator, you to can please? prompting

Operator

Argus First question sir. of Argus ahead, [ph]. go Don Capital Instructions] comes from Please [Operator

Unidentified Analyst

performing process? the do work have you people the then And world could seem It all be a talk outside lot the seems have it to opportunities of markets. U.S.? work Can globally in With about those is thank markets? sales like of you emerging, virtually? Yes, to anywhere? is you. work, in over you you done capabilities do your your And the what Or lot

Kyle Loudermilk

those simulation States. asking and This of projects And we for deliver especially out question. on we we great Don, Yes, that. globally, Thanks our United Kyle. the deliver Yes. globally solutions so is Look, capabilities. do

United the So Ukraine, we obviously, or that surrounding have to and have Slovakia recent ongoing projects Kingdom, either onboarding Poland. in

do well Fukushima, we're to market we're that for licenses business They was in Prior globally, poised for upgrade so we market, and the their Japan a we well So we We Japan. roughly Where as and XX% need serve that States. we certain provide business well global -- do continue our of to regularly grow. technologies are to to positioned talent market U.K. into net-net, that positioned project they And United of company. so. out we the globally

very inception of And the momentum ago. so we're And as segments, our since and this much key into SMRs United XX do well advancing of market to well business so that years nuclear positioned out norm globally serve for the very as that it's States. is

Unidentified Analyst

Okay.

you're there, normal on one Are of other was The project. providing than services little the services? it different? services from projects Talen suite seem current your is Or Energy the the to the different had a be I

Kyle Loudermilk

is think the group nature so Yes. specific. be the services let's It's for Look, engineering I project. engineering providing that that -- our

a this that is switchyards one we dynamic we're highly high to to very these the with host contracts that's data they're nuclear because systems data do they that them take because what project data we're centers very to this industry. in more having directly long-term solution that release of that about blockchain but wrote carbon companies we've be through industry. seeing complex on spend providing of market at norm claim board Talen utilities connecting apply is engineering companies, really XX/X. the to reliable, for them those voltage tech across premiums the the by these interested was the Talen very can lines leveraging center ways the campus. of services which highlight for all become we And centers and with in albeit doing by going few mining, bitcoin data the could we're unique very We with and press nuclear investing power specialty capabilities, simply that large spot very centers, they're providing And and specific Our solution we're that going to they those with value are that centers, them prices exciting intentionally look, is The carbon-free power to energy throughout a very significant major is very call seen emerging because as the power. associated many from capabilities to behind-the-meter They're in these that want excited clean, free. plant of that data project --

Unidentified Analyst

progress congratulations And the quarter. in you. Thank on the

Kyle Loudermilk

We're [ph]. Thank you. through thanks. Yes,

Operator

question Thank Dordatsky private [ph], Shai investor. comes ahead. you. next Please The a from go

Unidentified Analyst

me? good Hi, you hear afternoon. Do

Kyle Loudermilk

We How you can hear Shai are doing? [ph]. you,

Unidentified Analyst

you. Great. Thank

transparency. of for you It's all, thank such First above-standard great the hosting to call. have

just friendly want to are shareholder and very recognize appreciated. that I it's So you

thank And more? for culture? love win that. Is So that the as to where how it learn question a you more there buying about the to I'd the it industry So Is you contracts, win be, for industry large. nobody to would at to makes dynamic in not operate? got easier takes fired

Kyle Loudermilk

is, yes, answer the speaking, generally think, Shai. I

about invest. applicability August monitoring Arizona has system it in was for DBR the morning, Likewise, large that it and they months, paid of six I the understand in has very to like data the very get most much to operator you power just lost recent And really what I a we're be utility the the also to but us the how not specifically to about think but announced do, last an not community seen think investment number we over about performance wins that our want have the on market news we but that's only and grid industry the this of across specifically, out, change demonstrated doing. is specific are dollars the wins linkage our from good what thermal press producing for millions public the as spoke we center of this really project in we of very putting and transparent allowing specifics can releases only couch. get finding value how And to power example would significant operator we highlighting more it.

sales part can these our things So, to point now of as we efforts.

think typically I the that the cross-selling level of releases more successfully upselling in specifics being shows lot also are quarter and why that's aren't, marketing of And we're very capabilities much the that as transparent broadly. with gaining us to also and a we press explains as only that's momentum. norm and for but helpful

Unidentified Analyst

dovetails were out time X-K rate And second growth to you suggest May of a X-year, my XX, noted $X the horizon, growth million revenues sustainable question you annual would thinking I XX-year a think in over software might that a segment? on SEC the an be there software per that with for XX% rate. When what of with

Kyle Loudermilk

great a question, it's Yes, Shai.

Don release. like tremendous you'll Horn we led clients we're these Bahram bullish and by today as created we for very And earnings and we've have Software-as-a-Service solutions and wherever see well extent the as together resources. invest, given evergreen as the can in it's As there prior, out legacy But growing that to that technology new creating call from engineering working release what are our August on team, the value-added led modest Meyssami and as well we solutions sector. scale by clearly his press been our team team, with on-prem provide into solutions demonstrated which converted net could has our

It's imagine We margin. because grow to obviously we're growth it significantly But broker likewise. and that what ago years year, like of we this So don't we next high going features quite a company. of grown is specifics Had be line thesis look, of labor. done long-term feel for our to beginning what see expect really x just can XX we're as or the around but it's that began it but clearly just we're that we're going company. in to percent business investing license turnaround the continue. project year years at deliberately revenue just to Yes. fruits would so the be this now six beginning of with you ago, the size of part And it

team Bahram Horn, and to they out through So solutions. innovative congrats this Don new business as build and Meyssami to his

Unidentified Analyst

keep to it ceiling terms or could be there factors get tends large of just limiting you where then, might glass long sense the grounded; rate slow And to total properly own size term? down? -- the talk must in about very to expectations What the just the how be could of be my where

Kyle Loudermilk

each there back, industry look served very from Technology billion and much out Engineering you Workforce over if marketers look, past a couple the sectors. for at our recall I they for of Solutions existing one decks point, Well, if the adjacent Solutions investor at years nuclear correctly. were we what power $X put in and And Services, available

served So that's the the is, that's a market. ceiling minimum floor. What glass

to you've organic want our software, within in we company margin, early has it. and into We obviously growth on been grow investment particularly seen, around growth highly this we as the through for we So that. the high growth turn embarked profitable What inorganic put growth. thesis purely highly the

software Workforce there continue that Engineering at look but well and Solutions, pandemic. nevertheless, growth billion, the served accelerating north service technology, between is this the And $X United during from expect the while was you the decks. of a in Services, slowdown coronavirus, investor is this can States, in through We coronavirus to this is market, the

very look, we're also but we're bullish realistic. So very

fully So what the we're results hockey we are we're execute show on to stick, as and to going a project where the not a headed. business do and transparent to be stick. We're here hockey

Unidentified Analyst

the previous Aspen second headline interesting. in positions and actually And unit. at early business of your paragraph, Simulation you XXXX Emerson up when call, the July and appointed is language Design XX, press front were CEO. in quite have VP me in And I of release AspenTech which included that brought you there's the the

serve as at AspenTech. development You Lead [indiscernible]

your curious what should experience vision parallel, I'm all? How be at are for do GSE? that I far to influence degree And in studied you analogs into if what So read AspenTech to this with studies. case could your there think degree possibly

Kyle Loudermilk

joined business Bahram a a a prices forward journey part back me career into was growth, it's significant Datatel, sale took that all look, had to Meyssami Well, of MicroStrategy very and AspenTech. then from organic my I very That formative question. where revenue which growth microstrategy, great here. That through of

me and back that see going to that. great the doing and applied we've AspenTech applies We there, very to with that look, exciting amazing solve? liquidity they're cost GSE to there market that software to and shows move what How subscale a delivered both obviously is solve industrial It MicroStrategy to doing now learned we Great is day because very to does it's of the the significant deliver to are industrial clear it? applying in to for experience when applied that market What value that problem me, So for it problems transaction an have words at is is job the forward much AspenTech so call. business way the that this team that continuing the business. and at and added.

and here the tour be fortunate and excuse Meyssami him AspenTech also Datatel. new with for -- very work we here at duty focus, and of to third me, at of New at investment. a Bahram I I'm or We're together worked together at GSE. AspenTech. course

experience from who's And here. a member, Datatel a AspenTech. and storied Sundaram, at clearly So career the really have applies Suresh Board we AspenTech also

pay Emerson-AspenTech that line through And I today. of a of imagine of small the deal to valuation that and we're off we're had us this applying So, that the just question and then part experience of strategy. honored and our we're supply our our is to but see another don't of know seeing seeing have that you that not deliberate totality business. the or to career and that that GSE benefits if has

valuable could be. a how sense just this get You of

Unidentified Analyst

And the side. on my question last

how unpack And the and to it's degree small appropriate, growth in revenue or So the modular how brought You sort you GSE? of whatever translate? years. SMR Could for SMR reactor at metrics? it it and it translate Is relationship the Is unit what's up NuScale does economics? -- per XX unit? is

Kyle Loudermilk

how CPI industry. by be increases specific either rather or by It's we license Yes. we'll we'll customers our with user We contracts but software. of don't say, level transparency We do -- it specific license obviously, just about -- the SaaS general, a in make don't in the very annual X.X%. could by geared application, or towards SaaS-oriented. plus It's by standard site, It licensed module. renewals with usually X% to extent. It and we

pushing see get these X%. above you that sense very ratchets our It's business. So X.X%, meaningful when CPI down get a you to

to patches. it's continue We invest that so in software, upgrades, the et software sticky and the cetera and where security

are the Nuclear may want that other clients then another applications some evergreen. don't on-premise. clients, -- client things nuclear mitigated So highly be that keep to security they And to Internet. connected the maybe

annual So that's through and maintenance a it's paradigm we connected but when have hard that's to paid regularly. keep then that SaaS

are security So again, well to capabilities the as client all available latest as the pass to centre. the

Unidentified Analyst

become assumptions able market I if some of really know you're where begins it this what or share when units but be to to percent show Is don't a financials? comment again, there the number would material? of And in up

Kyle Loudermilk

to part a our delivered customers of and the as Shai, order started, de -- this particularly had projects Well, I'll say, when a in to IP minimis cost Historically, order was company that century. business. upside down, just of XXst project embedded in our win in was we

We've business, it's and our paradigm. that it's call X%. part done what to material highly changing long that And So of I'd here a It profitable. grown was we are overdue.

own is that you keep but models if project going, can your we so on And quite that it meaningful. that

Unidentified Analyst

so much. I you. Thank time. you appreciate thank your Okay,

Kyle Loudermilk

appreciate thank No, you, it. really man. We Yes, Shai [ph].

Operator

At [Operator this no time, further we Instructions] questions. have

remarks. Now back the I'd turn like Please for to call Kyle Mr. closing over go to Loudermilk ahead.

Kyle Loudermilk

be regarding Investor for flight a advancement very Well, our time and we're that Okay. and share GSE. at to with SMR and why Partners thank are as which Winter sharing positioning Lytham trends like We really your in We our that. as joining we macro to today we've done presenting decarbonization, everybody XX, XX. broader That's excited. Conference, the appreciate have I'd you also call. news We'll December the for good well feel look, interest XXXX

time. Please this do of and focus with hope attend you that we look speaking many to more. So to and forward on certainly we call at that

for call. any evening reach everyone. this us. who's follow-up Adam, joining we'd have Partners for schedule again, and on And you we'll a questions, be you, again, hesitate great If to thank Have thank to you call Lytham a out happy don't and

Operator

Thank you presentation. today's attending for

disconnect. now may You