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Edited Transcript of EVOL earnings conference call or presentation 12-Nov-19 10:00pm GMT

Q3 2019 Evolving Systems Inc Earnings Call

Englewood Nov 28, 2019 (Thomson StreetEvents) -- Edited Transcript of Evolving Systems Inc earnings conference call or presentation Tuesday, November 12, 2019 at 10:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Mark P. Szynkowski

Evolving Systems, Inc. - Senior VP of Finance & Secretary

* Matthew Stecker

Evolving Systems, Inc. - President, CEO & Executive Chairman

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Presentation

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Operator [1]

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Thank you, and welcome to the Evolving Systems 2019 Third Quarter Results Conference Call. As you may have seen, our Form 10-K was filed after market close today, and our press release was just issued. Joining us from management today will be Matthew Stecker, Evolving Systems' Chief Executive Officer and Executive Chairman; and Mark Szynkowski, Evolving Systems' Senior Vice President of Finance.

On today's call, Mark will provide an update on the core, and Matthew will update you on the business investment activities currently underway. Both Mark and Matthew will be available during the Q&A portion of the call.

Before I turn the call over to Matthew, I would like to remind everyone that the company will be making forward-looking statements based on current expectations, estimates and projections that are subject to risks. Specifically, statements about future revenue, expenses, cash, taxes and the company's growth strategy are forward-looking statements. Listeners should not place undue reliance on these statements. There are many factors that could cause actual results to differ materially from our forward-looking statements, and we encourage you to review our publicly filed documents, including our SEC filings, news releases and website for more information about the company.

At this time, we'd now like to turn the call over to Matthew Stecker for some opening comments. Matthew?

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Matthew Stecker, Evolving Systems, Inc. - President, CEO & Executive Chairman [2]

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All right. Thank you. Well, good afternoon, and thank you for joining us. Just 2 years ago, Evolving leveraged a significant chunk of its working capital and just about all the debt it could raise to buy 3 companies. Through these acquisitions, it entered a new market, the telecom-centric customer value management space. All 3 of the acquired companies were generally operating at a significant loss.

Many of you will recall that the hope was to transition them to growth by redeploying these newly acquired assets into a new set of vertical markets outside the boundaries of telecom. At the time, we were going to get them into retail and financial services. As many of you will also recall, I was Evolving's Chairman as those deals closed, and we were optimistic that this plan would unlock substantial value. What happened?

Well, Evolving found that it ran squarely into strong existing competition in those targeted verticals and was never able to deploy that software into new markets. As such, we are left with a much harder job, executing on the blocking and tackling necessary to integrate and turn these companies profitable without a significant increase in addressable market. On top of all of this, all 3 acquired companies had proud but aging technology platforms that had been deprived of R&D as their sellers shopped the companies and tuned them for sale. Evolving was left with having to do the investment necessary to integrate the companies while simultaneously rebuilding their platforms. I came onboard as full-time CEO as the breadth and scope of this challenge was coming into view for us.

So here we sit 2 years and a management change on, and I want to report on where we are. We have managed to build a new platform known to the market as Evolution. That is the flagship of the CVML business. I'll talk a little bit more about what Evolution does, why it's different and why it matters after Mark's comments. But it's new and really significant to us.

Also more importantly, this quarter, we passed the milestone of having Evolution pass acceptance criteria into production in its first deployment. We now know it works at scale in the most demanding possible environment, and feedback from the first customers is positive. From the overall perspective of the business, we've managed this process while staying EBITDA positive. We've often said on these calls that our plan has been to titrate product development such that we remain on the positive side of breakeven. And while this has been challenging, we're pleased to have generally done that.

Significantly, during this quarter, we announced the restructuring of our debt covenants with our lender, and we now have repaid a large part of principal net debt, having fully repaid one of the lines. We are in a trajectory to largely retire the rest of that debt throughout 2020.

So all in all, getting from where we were to where we are now, progress has been both measurable and tangible. Getting all this integration and product work done while paying down debt and while remaining at or above breakeven has been a significant achievement, and I'm proud of what our people have been able to do within those constraints.

So with that as background, let's turn to the financial performance. While third quarter revenues have fallen a little bit below our expectations, we did return to a cash flow positive performance in the quarter and for the year-to-date. Our costs remain firmly under control, and our cash position is strong. Generally, I believe these numbers are strong underlying indicators that while Evolving's journey has been longer and more difficult than we had all hoped, the company is heading in the right direction. The milestones we've been notching off are significant. I truly believe that optimism about where Evolving stands is justified, and there's plenty of evidence to support this belief. Our strong customer footprint and decades of proven performance give us the credibility that is critical for positively influencing senior provider buying decisions.

Just a few weeks ago, Evolving won one of the industry's most prestigious prizes, World Communications Award for Best Customer Experience for our deployment at Orange Belgium. Normally, we can't talk about specific customers, but occasionally, when they win an award, we're able to and really proud of it. The panel of industry expert judges noted that the metrics our solution supports as a new standard -- sets a new standard in the industry. The visibility this recognition gives us is invaluable and an aid to our sales effort.

Our investments in product solutions, both in the market of the acquired companies, the CVML space, but also in our traditional activation and orchestration solutions continue to position us to better support our global customers. We've been very clear in recent months that the key to future revenues lies in driving innovation across our product set while simultaneously finding new opportunities within our existing customer base. In parallel, we aim to consistently be winning new engagements. Though our clients are traditionally wary of publicity around software sales, thereby often precluding us from announcing successes, in this quarter alone, we have closed 3 significant deals.

As we look ahead to life beyond our debt covenants in 2020, we will begin to selectively seek new opportunities, whether through potential accretive acquisitions, joint ventures or strategic partnerships that drive both top and bottom line performance and over the long term to bring shareholder value. Our customer footprint around the world is incredibly variable. There are lots of products out there that would be more valuable in our hands, and acquisition isn't the only way to get that done.

At this point, I'll hand over the call to Mark Szynkowski for a closer look at the third quarter numbers. Mark?

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Mark P. Szynkowski, Evolving Systems, Inc. - Senior VP of Finance & Secretary [3]

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Thank you, Matthew. Good evening, everyone. Let me run through the numbers. Our revenue for the third quarter ended September 30, 2019, was $6.1 million, a $1.3 million or approximately 17.6% decrease over the comparable year-ago period. Total revenues for the 9 months ended September 30, 2019, was $19.1 million or approximately 19.6% decrease over the same period last year.

Service revenue, which includes revenues from the company's preference for managed service over perpetual licensing, comprised approximately of 97% and 94% of total revenue for the 3 months ended and 9 months ended September 30, 2019, respectively, and remains a significant part of our strategy as a method to engage closely and regularly with our client.

We reported gross profit margins, excluding depreciation and amortization, of approximately 67% for the 9 months ended September 30, 2019, as compared to the gross profit margin of 66% for the 9 months ended September 30, 2018. The increase in margin is primarily due to the decrease in client project hours as the staff has been used to support internal efforts and product development and engaging with existing and new client opportunities, adding to our sales efforts.

Total operating expenses were $4.3 million in the quarter ended September 30, 2019, a decrease of approximately $0.2 million as compared to $4.5 million in the corresponding period a year ago. We continually evaluate our costs and look for savings opportunities.

The decrease was primarily related to the reduction in general and administrative costs. We incurred lower legal fees as well as low -- as well as lower outside contracted services. These are partially offset by the increase in costs and product development fueling our ongoing product builds and enhancement and increased sales efforts as part of our strategy to grow our client relationship.

Total operating expenses were $20.8 million for the 9 months ended September 30, 2019. However, excluding the goodwill impairment of $6.7 million recorded in the previous quarter, the operating expenses were $14.1 million. No change as compared to the $14.1 million in the corresponding 9-month period in the prior year, again, as increased cost and product development and sales have been offset by cost savings in other areas.

The third quarter operating loss was $0.3 million as compared to a $0.6 million operating income for the 3 months ended September 30, 2019 and September 30, 2018, respectively. The loss was primarily related to the decrease in revenues.

The company reported adjusted earnings before interest, taxes, depreciation and amortization, adjusted EBITDA, of $0.1 million for the quarter ended September 30, 2019, as compared to $0.9 million for the same period a year ago.

Our cash and cash equivalents as of September 30 were $4.3 million, a decrease of $2.4 million or 37% compared to $6.7 million as of December 31, 2018. This decrease was primarily related to debt repayments as the company generated positive cash flows from operations in 2019.

Contract receivables net of allowance for doubtful accounts was $6 million, a decrease of $1.8 million compared to December 31, 2018. Unbilled work in progress net of allowance for doubtful accounts was $2.7 million and $3 million for the periods ended September 30, '19 and December 31, 2018, respectively.

Working capital as of September 30, 2019 decreased on a sequential basis to $4.9 million from $8.1 million as of December 31, 2018, due to the decrease in our cash and cash equivalents from payments on our outstanding debt and interest. Working capital also was decreased by a recording of a current liability of $0.4 million related to the adoption of the Accounting Standards Update, ASU 2016-2 on Topic 842 for operating leases, which is new in 2019.

In addition, we have recorded $1 million as short-term debt liability to account for a combined prepayment amount due as part of the amendments agreed to with East West Bank that updated our terms and financial covenants for our credit facility. These are less restrictive to our investment and growth strategies. The company has made and continues to expect to make every loan repayment in full as originally scheduled, and we believe we have ample cash on hand and liquidity in our working capital to fund our business and continue to make strategic investments.

Moving on to our business report, I'll turn the call back over to Matthew.

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Matthew Stecker, Evolving Systems, Inc. - President, CEO & Executive Chairman [4]

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Mark, thank you very much for that. And I know there was a lot there, and we'll have an opportunity for people to ask questions about the numbers as we wrap up.

As I discussed earlier, Evolving's journey has been more complicated and more difficult than we anticipated when we decided to embark upon this path with the acquisitions 2 years ago. That said, we have passed significant milestones and have achieved tangible progress.

Our continuing adjusted EBITDA-positive position, our cash reserves and the evidence of a turnaround in both products and performance in the business itself are noteworthy. I'm going to take this opportunity to talk a bit more about Evolution, what it does and what it means than I normally would on a call like this. I think it's important to an understanding of the business overall.

Evolution is both critical to our future success as well as demanding in resource terms as we reach its final stages of its first deployment. It also turns out that the first Evolution customers are some of the largest and most complex across our existing user base. This has meant additional time and development effort to make sure the products have been backward compatible and to work at scale, but the good news is that it's already been tested at scale.

As I discussed, the quarter has seen Evolution operational for the first time on customer sites with live data. We're now in a position to begin to reap the rewards of over a year of hard-fought product development.

So I want to bring into clarity for a second what Evolution does. Generally, it is a platform that looks at everything that happens within a telecom users base, both on the activity side, what are people doing with their handsets, what calls are they making, what websites are they looking, what kind of text messages are they sending, who are they calling, when are they calling, what is everything they're doing on their handset. But also on the financial side, when do they pay their bills, how fast are they using their balance, what's changing about their credit, what's changing about their payment profile, what's changing about their demographic data.

We then use this data and the knowledge it represents to overlay marketing triggers that take actions to optimize the value of the carrier's user base. Sometimes, these actions are simple promotions. We send a SMS, for example, that says now might to be a good time to upgrade your handset or your plan. Because we know that in this instant, you have money and are at that point in your customer journey where the specific offer is tantalizing for you. This example is simple, but you can imagine that the promotions we run can be incredibly complicated in terms of the number of variables and dimensions they look at with deals and offers tailored to individual users and also tailored to the individual business goals of that carrier customer.

Additionally, all this data is also used to run a spectrum of loyalty programs in multiple flavors, ranging from simple points programs to multifaceted gamification exercises, like we won the award with just recently, that engage and delight our end users while delivering both value and loyalty.

Now if you think about the scale of all this data and the need to have it processed in real time, you'll project a challenge that saw us running up against the limitations of the horsepower of the previous technology platforms that we inherited from the acquired companies.

A decade ago, when the predecessor systems were built, the state of the art was to handle this kind of big data problem, was to store and copy all that user and data and logs into big databases that were then queried and triggered for actions. The challenge we faced was that the store, copy and query method was running out of steam. The database engines themselves we were using were hitting the maximum theoretical limitations for their size. Performance is beginning to suffer such that we can only be really effective in smaller operators that had lower volumes.

There's a reason that the footprint of this part of the business is concentrated in the emerging market. And while we've built a strong capability of doing business in that sector, the truth is, and it took me a long time to figure this out, that our systems were also limited in the scale of -- to the scale of the operators that were found there. We had to say no over time to multiple opportunities to deploy in environments that were just too large for the system to handle.

Evolution solves this problem by putting a real-time analytical engine across the streams of carrier data that catches relevant triggering events in real time. A way to think about what it does is in this illustration. Think of Evolution as the policeman whose job it is to hand out traffic tickets on Fifth Avenue. The previous system stored everything about the behavior of every car that went by, recorded where it was at every position in time, had an engine that would analyze vehicle movement data offline and send users speeding tickets in the mail.

Evolution, on the other hand, watches the flow of traffic, and in real time flags just the cars that needed tickets. It records for each one why and what conditions merited the ticket, but it's able to get the same result without storing all those huge databases. It doesn't have to store any information about the majority of traffic we're not interested in. We leverage state-of-the-art techniques and technologies to do this, and the result of it is that with this architectural shift, we can now handle carriers much larger than ever before.

We still have in front of us the hard challenge of selling into those larger customers, but the technical barrier is gone and from a strategic perspective, it means significant new addressable markets for us. Within our existing footprint, the salespeople had knocked on all the doors there were to knock on. But now that we can really handle Tier 2s and smaller Tier 1s and even larger Tier 1s, we have a lot of work in reconnecting with customers that we've ignored for a long time because we couldn't technically support their needs for many years.

On the traditional Evolving side of the business, our customer activation and network services business has been through and has now emerged from equally significant transitions in its product lineup. Our newly repositioned (e)SIM Life Cycle Management Suite, a coherent set of offerings reflecting our unique ability to help carriers keep pace with the evolution of SIM functionality, particularly the advent of the (e)SIM is central to the business that's generating more interest in the market, and by extension, more hard leads.

In addition, on top of all that, we have a new product called [Chameleon] SIM in the early stages of development that allows MVNOs to seamlessly work on top of multiple network operators instead of being tied to just one.

In terms of sales, the unfamiliar but positive problem thrown up by our work in the first half of 2019 is that the growing number of opportunities we're addressing is now stretching our resources as we strive to exploit them. Our investment in marketing in 2018 is paying off with our first deal driven exclusively by a market-sourced lead, closed that month and now have delivered.

There's still no question that a great deal of work remains to be done to optimize our performance and continue to expand our revenues. But as I said before, there's more and more evidence that the foundations for success are firmly in place. The shift from rebuilding mode to growth mode is almost complete.

Finally, over the last year, extensive work has been done to revitalize the company's products and pipeline. With recent customer wins and the industry award and an enhanced pipeline, I believe the market is taking notice. One consequence of the story is we're now starting to devote significantly more attention towards IR and telling the story of the company and what's happening here.

So I want to thank all of you for your support and look forward to updating you on our continued progress. I've had the pleasure of speaking to many of you individually, and I've been especially happy during this quarter to have spoken to some new investors, in addition to the many folks that have been following us for years.

If you'd like to have a call with us or speak to management about the company and its journey, feel free to follow the links on the website and shoot a message to our IR team.

At this point, I'd be happy to open the call to questions, cognizant that I have gone on longer than I traditionally would in a call like this. Operator?

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from the line of [Mike Chenoweth with Antheus Capital].

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Unidentified Analyst, [2]

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And I appreciate the continued mind-set on keeping costs in check while you're in the transition cycle. Okay. I have a question. I came in just a few minutes ago. Obviously, I may be asking something that was already answered. So just bear with me. I wanted to go back to some of the contracts you were alluding to on the last quarterly conference call, and if you have any updates there that we can -- that can be disclosed or discussed further at this time.

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Matthew Stecker, Evolving Systems, Inc. - President, CEO & Executive Chairman [3]

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Okay. I'll let Mark talk about the detail. This is Matthew. In general, we have moved away from -- way back, going back a few years, we used to report bookings as kind of a predictor of where our future revenues might be going. We stopped doing that. And if you look at our business, there are -- in any given quarter, there are 6 or 7 new deals that closed, ranging from small to large. And that is a distribution of deals such that when you impose it over a quarter -- doing the same amount of work. One quarter you can close 3. In the next quarter, you close 9. Or depending on where the quarter boundary is, one quarter you might close 6 and the other you close 6. And so it's a little bit hard, and that's why we don't report because it's been pretty lumpy.

What I can tell you is, subjectively, we've been pretty happy with the state of deal closing. There was a lot of stuff that has shifted throughout the year. And so I expect in the fourth quarter, as I alluded to in the press release, if you read -- traditionally, the fourth quarter is strong for us because that's when telcos have traditionally cleaned their budgets, and they usually have -- they often have a use it or lose it mechanism by the end.

So while we don't report on specific new contracts and where they are in terms of closing, we can say that we've been happy with kind of the pace we have of deal closure.

It's always tough in -- we had -- I think when you take a look at the yearly cycle, we will do well. Every quarter, we always are chasing orders to try and get them closed by -- in the last days of the quarter, and that's why the fourth quarter is kind of cleanup.

Mark, I don't know if you can say anything more than that, but I'll let you have a crack at it.

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Mark P. Szynkowski, Evolving Systems, Inc. - Senior VP of Finance & Secretary [4]

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Well, no. I mean other than, like you said, the taking out the specifics, they definitely range. I think also that they range sometimes in size. You can have very large deals to very small. On average, we've seen the deal size somewhat shrink due to the competitiveness of the market. However, we do have some deals out there. And they're -- it's all about ongoing and recurring revenue for us. As also, as we reach certain milestones, that revenue can be recognized out over anywhere from a 4 to 6, 7 months, sometimes a year even pops in recognition.

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Matthew Stecker, Evolving Systems, Inc. - President, CEO & Executive Chairman [5]

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Yes. So just in summary, we made the decision awhile back that we announce revenue and that we were chasing our tails a little bit, trying to announce bookings and deals. So we don't. So we'll talk subjectively about them as potential indicators. We'll talk about having won some deals in a particular geography, but we do not try and make a promise to track, hey, we talked about 3 new European deals and let's update you guys as to where they are. So when we talk about deals in progress, it's usually just as an example.

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Unidentified Analyst, [6]

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Okay. So maybe we can think about it another way then. If the business is such that you're recognizing revenue, you're saying 4 to 7 months, I think, on average, are we talking about the complete revenue recognition of the first year agreements? How should we be thinking about the duration of the contracts? And what type of KPI should we be thinking about then for this business in terms of understanding the recurring revenue model?

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Matthew Stecker, Evolving Systems, Inc. - President, CEO & Executive Chairman [7]

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It's a good question, and we can give you certainly some more detail off-line and be happy to do that. But our customer's pay -- one of the things that we've done is we, a couple of years ago, we created a managed services offering. And when you think about what that did, it did not change what we sold in any way, really. But what it did is it created an alternate financing vehicle for our customers.

So traditionally, a customer would buy from a set of software licenses and then maintenance and support. So you'd see a big lump of revenue in year 1 when they bought the licenses. And then depending on the length of the deal, 2, 3, 4 out years of some relatively small revenue, maybe 1/10 of that original size, maybe 1/4 for ongoing maintenance and support. So our revenue would be very lumpy with the big hit during the quarter.

That being -- sorry, our cash flow would be. But from a GAAP perspective, it has always required us to amortize that license revenue pro rata across the life of the contract. So from a cash flow perspective, we would get that big lump in, in the first year. But from a revenue recognition perspective, it was essentially -- that big license revenue would be taken ratably throughout all the years of the contract.

So today, customers either buy in that model. They'll buy a license and service, or we will offer them a managed service fee, which sometimes helps them get the project into their OpEx budgets. So instead of charging them $1 million for licenses and $100,000 a year for maintenance, we'll just charge them $300,000 a year for a flat-out license to kind of everything in the tools they need in our toolkit, plus all the support they need.

Same result from our end. And whether we sell it as a CapEx project or as a managed service project is largely depending on the customers' environment and whether they have CapEx or OpEx dollars. But it's really the same product and program that they get.

Almost all of our clients are multiyear engagements. So we don't announce the breakdown of what is new and how many years they're under contract for, et cetera. But I said in previous calls that one way of understanding both sides of the business is that in any given year, about 70% to 80% of our revenue, if we didn't do anything, would continue in future years. 30% would end. And because carriers are either: merging, they're integrating, they're moving on to new solutions, they're upgrading their underlying technology stack and don't need our stuff anymore.

And so the tail of the tape is really if we can sell, if we sell more than that kind of 30% replacement, we will grow. If we sell at exactly that 30% replacement, it stays at the same size. And if we sell less than that, we'll shrink a little bit.

Now obviously, there's a whole part of the company that's deployed at trying to reduce that churn rate as well, trying to make sure that there isn't 30% at risk. But in terms of what's at contractual risk any given year, it's probably about 30% of our underlying revenue where people would have the options to do something else. But we've been pretty good about getting a lot of customers to stay with us through that transition. There's always a price renegotiation, of course. But that's kind of the metric. And again, because we don't give out detailed information about the aging of new contracts and where they sit and what's recurring and what's not, I know it can be frustrating to track. But give us a call off-line, and we can help you try and understand what you need to.

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Operator [8]

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And we do have another question. This comes from the line of [Alan Lee], private investor.

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Unidentified Participant, [9]

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Okay. I just had a question here. I noticed your cash has gone down quite a bit over the last year and you're paying down the debt, which I understand. And you're saying you're -- Evolving is about to reap some rewards here very soon. So my question is, are you expecting the revenue to go up quite a bit over the next 12 months?

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Matthew Stecker, Evolving Systems, Inc. - President, CEO & Executive Chairman [10]

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Well, it's a great question, [Alan], and so it's an astute view. What's happened in the last year is that we run at breakeven, and running at breakeven has meant that paying off the debt has come out of our cash. And so the good news is that, that load ends in 2020. So we will finish paying off the debt.

In terms of the projection of the business, everything we're doing has been trying to set the stage for growth. That being said, if you take a look at the revenues, both the pro forma revenues of the acquired companies and Evolving's historical revenue net of the acquired companies, there's been a multiyear downturn in the revenues, right? The telecom environment is smaller than it used to be. A project that we would sell 3, 4 years ago for $1 million are now $200,000 projects. And that's not because the work has changed, it is because we're selling into a cost-constrained environment, right?

A couple of years ago, telecom operators would be asking us, hey, how do we plan to grow with you? Now they work -- they, if they're good customers, they reach out and say, "How can you help me work in an environment where my top line revenue is shrinking, my budget is shrinking and my budgets are cut?" And that's just the lay of the telecom environment.

That being said, we've been working on -- everything we're doing is around rebuilding revenue. And so the moment I think we're in and to get from shrinking, which is where we've been, to growth, you have to pass through staying the same size. It's a little bit hard to tell whether you're there or not yet because we have a lot of seasonality. Q3 is usually down. Q4 is usually bigger, as we've discussed. So given that the lumpiness between the quarters, it's a little bit hard to instrument and tell where you are.

But the moment I think we're at is passing through that flat spot. And so I think the first notch in our belt will be to say, "Hey, we're here," right? We can consistently pull off the same revenue performance. It's not going to be shrinking year-on-year anymore, right? That will be the first milestone. And then we'll start really turning our heads to monitoring growth.

I mean I think we have everything we need in order to put the platform back onto modest growth. I think we could get back to being the same size that we were in 2018 and then 2017. There's nothing about the business that can't achieve that kind of performance.

So again, we're not giving a prediction, but that's where we're trying to go, right? Investors have been very clear that they've been patient throughout this process, but no wants to see us tread water eventually that doesn't get us anywhere. And so they've been clear that we need to grow. And again, the first step for that will be proving that we stopped shrinking, and I think we're there. But the next few quarters will tell that. And then we'll hope to start putting up some slow but consistent growth. And that's for the organic business, right?

But the way I think about it is that once we're done paying off the debt, then we could start making strategic moves that augment that. So if you look at what these 2 businesses we have now, how they're performing. I think, again, they've been shrinking for many years. I think they're probably at the end of their shrinking cycle. And given the product investment, we should probably see them pointed towards -- from straight line into some slight growth in the next year. And then on top of that, we'll be able to start thinking, as I mentioned before, about what other kinds of products, what other kinds of partnerships we can do to make some strategic moves once our hands are basically untied from the bank debt in 2020.

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Operator [11]

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And we have no other questions on the line at this time.

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Matthew Stecker, Evolving Systems, Inc. - President, CEO & Executive Chairman [12]

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Awesome. Well, hey, I appreciate those 2 questions, and thank you.

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Operator [13]

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Ladies and gentlemen, I want to thank you again for your continued support. Management will be available to -- with investors throughout the week. And if you have any questions, by all means, please feel free to contact us, and we look forward to communicating further progress and developments with you. And we're now ready to end our call.

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Matthew Stecker, Evolving Systems, Inc. - President, CEO & Executive Chairman [14]

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Thanks, everyone.