Nanophase Technologies' CEO Discusses Q2 2013 Results - Earnings Call Transcript

Aug. 2.13 | About: Nanophase Technologies (NANX)

Nanophase Technologies Corporation (NASDAQ:NANX)

Q2 2013 Earnings Call

August 1, 2013 11:00 AM ET

Executives

Jess Jankowski - President and CEO

Frank Cesario - Chief Financial Officer

Analysts

Bill Chapman - Morgan Stanley

James Leiberman – Wells Fargo Advisors

Operator

Good day, ladies and gentlemen and welcome to the Nanophase Second Quarter 2013 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instruction will follow at that time. (Operator instruction).

The words expect, anticipate, plans, forecasts and similar expressions are intended to identify forward-looking statements. Statements contained in this news release that are not historical facts are forward-looking statements that are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.

These statements reflect the company's current beliefs and a number of important factors could cause actual results for future periods to differ materially from those expressed in this news release.

These important factors include, without limitation a decision of the customer to cancel a purchase order or supply agreement, demand for and acceptance of the company's nanocrystalline materials, changes in development and distribution relationships, the impact of competitive products and technologies, possible disruption in commercial activities accessioned by terrorist activity and armed conflicts, and other risks indicated in the company's filings with the Securities and Exchange Commission. Nanophase undertakes no obligation to update or revise these forward-looking statements to reflect new events or uncertainties.

I would now like to introduce your host for today conference, Mr. Jess Jankowski, President and CEO of Nanophase. Sir, please go ahead.

Jess Jankowski

Thank you. Good morning everybody. We’re glad you’ve been able to join us for our second quarter 2013 financial conference call. Frank Cesario. Our CFO is here with me also. Today we’ll be talking a bit about our new initiatives as well as updating you on our existing business. At a high level, quarterly revenue this year has ranged from $2.7 million to $3 million and proven over our quarterly revenue last year which range from $2.1 million to $2.8 million. After Frank provides a short overview of our financial results, I’ll go into a little more detail about our position as we keep rolling into 2013. Frank?

Frank Cesario

Thanks Jess. Good morning. This is Frank Cesario. Before I begin today’s overview of our financial results for the second quarter and first half of 2013, please remember that all financial results are stated in approximate terms.

Revenue for the second quarter was $2.7 million versus the revenue of $2.8 million for the comparable 2012 quarter. For the first six months, revenue was $5.7 million this year, up from $5.2 million last year.

Gross margins were 32% for the quarter and 31% for the first half versus 31% and 27% for the comparable quarter and six months of 2012. The net loss for the quarter was $0.5 million or $0.02 per share and $0.9 million or $0.03 per share for the six months ended June 30, 2013, compared to net losses of $0.4 million and $1.2 million or $0.02 per share and $0.04 per share respectively in the comparable 2012 periods.

We ended the quarter with $3.2 million in cash position. Our company remains debt free. I will note that we invested $0.5 million in working capital during the first six months of 2013 which is a reversal of working capital benefit during 2012.

Jess?

Jess Jankowski

Thanks, Frank. While we are sure off to a solid start, everyone who has been listening those that our goals don’t stop achieving $3 million in quarterly revenue, but the overall development in business does represent another step toward our next milestone achieving positive cash flows on a consistent basis.

I said it before and this has been internalized at Nanophase. We fully understand there are real challenges ahead of us and our goal and vision is firmly set on accruing high value to our shareholders and stakeholders. That’s why I am here, that’s why the team is here.

Those are my expectations which I share throughout the organization. No one look at forward to saying we made it more than I am and they say to – set much higher then only achieving positive cash flow.

At this point, we are not sure about our second half volume, but we expect 2013 revenue to be close to that of 2012. The reason that the number hasn’t been higher yet is due to the greatly reduced revenue from two legacy customers. Now, this was a reduction that we fully expected and have discussed in the past.

We’ve seen a decline in CMP polishing revenue from Dow that even though we knew it isn’t coming but difficult to absorb. We’ve also seen the sun setting of our long-term exclusive licensing arrangement with CIK Nanotech which saw the last licensing fee revenues in 2012.

These two changes will result in a year-over-year reduction in full year revenue of $1.1 million. On the other hand and here is the bright spot, we’ve seen growth in other areas that has absorbed this loss in revenue. The growth we have seen should be sustainable going forward and has replaced some long declining revenue streams.

We expect to be able to establish a stronger trajectory going into next year with new business coming on in addition to growth and the business that we’ve developed so far to replace the legacy business we just discussed.

All in all, we are in good shape here. I mentioned in our last call, that we further expanded our franchise by developing products in a few new areas related to energy management. In particular, we’ve begun to market both of our energy solutions. As we made some good progress today, I’ll paint a clear picture than I thought comfortable doing in the past.

We are always a little cautious in talking about these efforts because our goal is to be the first of the commercial space with new technology and we are still in the commercial development process. Working to alleviate the annoyance investors may feel through not getting complete information for now is our way by the need to control these products that they rollout.

Feedback maybe this year or maybe into next, but one way or another we expect to get solid commercial feedback quickly and are prepared to transfer both solutions to revenue as soon as possible, of course that’s customer dependent. The first is in the energy storage space and will allow us potentially to leverage our technology and products in a more valuable way.

As many have speculated it is indeed a battery application and simply put we look to replace materials being used commercially today with materials we believe offer superior functionality and an attractive cost.

We are now relying on a new industry being developed, we aren’t forcing existing players to change their processes, but expect to provide them with both an immediate replacement solution and a mechanism for them to make changes to reduce cost in related areas if they choose to for their future benefit.

We believe this to be a powerful value proposition. We think this solution should deliver cost savings and performance gains today with the roadmap toward additional savings down the line for those customers.

The second is an energy control solution for an existing market that is slightly behind the battery application in terms of expected timing, so we’ll hold up on a more discrete explanation for now. Here too, we believe we got the material solution that provides significant performance benefits versus our competition at an attractive price point.

The commercial rollout here will look different than with the battery application but again, we’ve targeted an existing market in a more straightforward replacement of existing materials.

One change to our business growth process has been the tightening of the management of our projects. I have talked about this before, but just to reiterate, we’ll only research a few projects at a time as opposed to working at many things at once in order to maximize our leverage.

This enhancement of focus and expertise has been an evolving initiative over the past two years and I expect it to continue. We believe focus will bring speed and allow us to more quickly identify winning ideas or replace struggling projects with the next potentially big opportunity from the list.

I expect a solid ROI from our investments in this development work and we are all in the same page here now. This expected growth in new areas will be an addition to expected growth in our existing business including an attritional personnel care applications and potentially in several polishing applications. We are looking both to lock in incremental or better improvement in our existing markets while targeting more dramatic results in some newer markets.

We believe that this balanced approach that encourages speed to market and a better share rate is the right one for our company. With that, I’ll tie things up. Although most of our investors listen to the webcast or review the transcript after the live call, we’d like to invite those participating in today’s call to ask any questions you may have or to share your comments. Nova, would you please begin the Q&A session?

Question-and-Answer Session

Operator

(Operator Instructions) And our first question comes from the line of Bill Chapman of Morgan Stanley, your line is open.

Bill Chapman - Morgan Stanley

Jess, Frank, good morning. Can you guys hear me okay?

Jess Jankowski

Yes, hi, Bill.

Bill Chapman - Morgan Stanley

I’m sorry, I’m in airport. So forgive the background noise if you can hear it. Hey guys, on the battery story, can you give me a general idea about what kind of cost savings you are hoping to get? Are you talking 5% or you hoping over 20%? Just kind of – just a general range if you could, please?

Jess Jankowski

I don’t want to do that. I think what we can do is deliver savings to them that is typical to better than typical of what they were targeting but on a longer term basis, fairly broad area. And when we talk about the application, this is one area in a field that many – I’m generically referring to it as batteries, this is in a relatively narrow space and it represents some potential for us for good revenue now.

Everything takes some time, I would like to see the thing unfolding next year and I view it as positive but part of my issue with sharing more information is just that we are – the commercial process we are always negotiating with customers and we are going back and forth and where the value is. I think it’s a nice thing for the company to be above them. I think it’s something that if it comes out could very well be life light to our business.

Bill Chapman - Morgan Stanley

Okay, thank you. Now we also are talking about improved performance you are talking about improved battery life or more amperage with less cost or can you give me a general idea on that?

Jess Jankowski

Generally, I think the life would be improved broadly, those – lot of the things that you just discussed are very inter-related. If one thing gets better and one other thing gets better, but I would say generally it would allow that and allows some cost savings as well.

Frank Cesario

There are also be some differential, it’s Frank, from a customer-to-customer basis, because every design a little bit different, but in both cases we are talking about meaningful numbers Bill.

Jess Jankowski

Okay, thank you. Now we are talking car batteries, cell phone batteries and – because on your website you have a lot of batteries that I mentioned.

Renewing lot of – would mean that simple, we’d ask doing it lot of this just weighing it out a little under time just.

Frank Cesario

I think we just have to wait a little bit and get a little progress and part of it is, I don’t want to potentially create an issue with a customer, but I think it’s a broad thing, it’s an area where there is potential for growth. And additionally this is a space generally speaking where we’ve thought that nano materials could have more than one application, not every application for every kind of battery depending on which they are.

But if this accessible, we’ll probably then expand into it and what I am doing I talked a little while ago about kind of separating our resources and focusing more tightly on our projects, we are focused on a very specific area that could generate some good revenue for Nanophase. If we have success, in the commercial side in the market, we will probably expand and look at some other areas in the battery space, and I don’t want to go beyond there right now.

Bill Chapman - Morgan Stanley

Okay, another tricky question if I may please, you mentioned you don’t want to go back to exclusive deals. Is there a possibility you might be willing to do exclusive deal on this battery?

Jess Jankowski

There is always a possibility. I guess if that was going to qualify that, if you look at the business in the past we had some exclusive relationships where we were further away from the user which created issues and there was absolutely no requirement on the part of the person we were in a relationship with the company, we had a relationship with for buying.

So it’s not that, we wouldn’t consider an exclusive relationship but we just have to be the terms what have to be commensurate with the value we bring to the table and I t think, live and learn, if you look at our business, certainly we’ve been around for a while and the exclusive relationships were in kind or a tightly clustered area between, say the late 90s and the early 2000s when we viewed the business differently.

Since we’ve changed management here and we built the new team, we have a new approach and we believe that the only way we are really going to succeed is working directly with those end-users, the exception there currently is that the BASF relationship which is, we have an excellent relationship with them.

We do a lot of development work for them, we bring expertise to the table. But we don’t directly touch that end-user of our products and that presents some issue. It’s good for reach, it’s not always good for experience and in the case of BASF, it’s been a great relationship.

And as – I don’t know Bill, I don’t think you’ve been around as long as some, but initially I think the success with the BASF relationship drove us towards their partner model then as we did it a few times, we talked about that all today, and in the past we’ve had book and some others.

We realized that every exclusivity is not the same. There needs to be more rigid standard and I think also, and this is something that I have been talking about for sometime. The value of Nanophase really has a lot to do with applications development. So we make a lot of really neat particles. We know how to code, we know how them disperse them.

But also know how to get them to work into things and I would say we didn’t capitalize on that in the past to the extent that we are now and to capitalize on that you really have to understand what is going into it, that’s the change there we’ve been working on for several years.

So, very long wended answer to your question, the answer is yes, but. We would, but it has to be better than the ones we’ve done in the past or more. Better is the wrong term. We have – at the time, we know more than that we know that and I think it’s the better way to be successful.

Bill Chapman - Morgan Stanley

Okay, let me ask you too, are we going to be manufacturing the materials, are you looking to do a roll GDO unless the OEM manufacturers using your processes?

Jess Jankowski

If we could, we’ll manufacture the materials, it’s always possible down the line, our model currently has been that that we would manufacture materials and that’s two-fold. We have a discrete process that is different than the processes. So if you were to look at our materials, typically, they look very different than everybody else’s materials.

There is a combination of the patents and trade secrets that protect that. So we are always very careful about moving any of that outside the building. Also and I think more importantly, some of these applications were migrating toward or much higher value applications where the material bulk isn’t really an issue.

We wouldn’t be shipping tanker loads full of water anywhere or train carriage full of material. We’ll be shipping very high value material in a way that’s not the shipping cost and the logistics don’t make it inefficient thing to do from here.

Bill Chapman - Morgan Stanley

Okay, and one last question and so I am going so long. What you have behind the curve and the new technology applications you come with up that you are not going forward with, you are focusing you mentioned of energy or to energy solutions. Is a possibility of partnering with the other ideas you come up with, just for the sake of scale?

Jess Jankowski

Potentially there is a couple of issues to contend with. The one, you’ve always got a bandwidth issue where we’ve got a relatively small company and there is only so much time to have people build those relationships, we do look at that and we are open to that.

We do talk about it. Some of that also is, what we absolutely go on and do which every tech company is guilty of at some point or another is embedding things for with there is not a market.

So, we have some – what we believe is some nice technology. We haven’t done all the market development works and really I think we don’t maximize the profitability on it if you go right out with an idea without having done some of that work.

Now Kevin Cureton brings a really nice perspective on that our brass is better than it’s been. Our marketing strength is better but there is still some limitations. So we keep – we are working on other things beyond what we are talking about but we are keenly focused on these things because we realize we’ve got to get – kind you have to be there, to be there and we are going forward.

The hit rate historically hasn’t been that high, we are trying to make that hit rate better, also recognizing the fact that we need things going through the front-end of the funnel to be able to replace potential things that are either successful, unsuccessful, successful in a lesser way that we thought, that’s always a risk. I think we are better positioned than we’ve been in the past to do that. I really – I like where the company is sitting right now.

Bill Chapman - Morgan Stanley

Well, I want to thank you guys. I am really in my affiliation with you and I thank you all the team. I’ll get off the phone now.

Jess Jankowski

We appreciate you taking the time out and don’t eat bad – bag leathers on the plane.

Bill Chapman - Morgan Stanley

Thank you.

Operator

(Operator Instructions) And at the period we have no further questions in queue. I’ll turn the program back to you. One moment, we do have a question from the line of James Leiberman of Wells Fargo Advisors. Your line is open sir.

James Leiberman – Wells Fargo Advisors

Thank you. I thought I had got on the queue earlier but apparently not. Greetings, it’s a pleasure to hear the progress you are making in these new opportunities and I wonder could you comment a little bit more on some of the applications – though some of the legacy areas like new growth opportunities in polishing or in the personal care area?

Jess Jankowski

Sure, hi, Jim. One thing I guess was going through my – I recognize, when I said, I mentioned that, incremental or incremental plus growth in those areas, we will be adding new customers in those areas as well which would be more than incremental. I just look at it at the top-line basis. In those areas, personal care be a tough business has grown significantly over the last several years.

Last year I don’t remember the number off the top of my head, but it was in the high $6 million range or mid to high $6 million range and it has been growing and there are lot of nice forces that are helping that relative – the acceptance of nano, we also have a larger product in the US that’s not the case.

Europe is look at that being a positive now, zinc oxide being a positive which was not the case in the past. And we are seeing market growth generally. BASF while growing is also seeing a little bit of competition which we view as a good thing because zinc oxide is growing in that market.

I think there is room there. We also have been doing, we developed the new products for them last year. I can’t disclose these things just because it’s not my place to disclose when they are going to launch products, but we are working with them in the product development cycle and I think their attitude is very positive toward and I think there is room for growth. Relative to the …

James Leiberman – Wells Fargo Advisors

Can I ask one quick further question, when BASF announces a product or issues a new product with one of your products in it, is there any way that we can be notified as shareholders or sort of like we keyed into it or do you have some guidance on that where that we could follow on?

Jess Jankowski

Sure, we usually, it hasn’t happened since last year. We did talk about the LSA, it was called decode LSA was the product they launched last year. They haven’t seen a big move and again part of it is just the way the cycle works.

They have something they call the filling season then they have a lot season and if you miss a certain window, you got to wait here and there are a bunch of things that work in that. I would say generically, it’s growing in a positive way and we will definitely put something out.

Nothing happens quickly in these markets. The good point is, typically the reductions when there is fluctuations don’t haven’t quickly either, the rest of the business that you mention and the polishing side we’ve got optics polishing and some other things that we are looking at we continue to work on that and we had some new products there.

We haven’t really talked about it much because the, we haven’t seen the growth yet, but we expect there could be the rarest situation has balanced out which makes it better. The downside in that business is the CMP business with from Rohm and Haas has gone our way.

And that we expect that to happen. We actually thought it was going to happen longer previous to one it has, but this year would probably be the last time in a little bit that we’ll have some revenue there. There is some growth but it’s not really moving and the rest of the polishing business we think we have some room there.

We also still have – business particularly in graphic arts we’re doing our launches in a more targeted way. We are going after some bigger customers. I expect we might see some business there and we have customers that are still working on launching products. Just the thing is, and I know that you’ve got almost as many – than I do Jim over this.

But the thing is we’ve had – we continue to have products that make it through the cycle of the customer get launched and their customers don’t buy up. So last year I had mentioned I was h happy with the degree of launches we had which, the reason I don’t talk about it in the conference call or in the press releases is it because they haven’t resulted in revenue and I recognize that’s what we are here for. But we are seeing more things make it sure and I believe, we’ll still see more of those things building top-line as we go.

There is always the risk of legacy business shrinkage. Some of the coding business we’ve had in the past isn’t strong and we are also not as focused on it because we’ve seen some opportunities to build thing as a little more quickly, a little more profitable. But we still have a fairly robust development projects going on relative to the graphic cards business.

We’ll see where that goes, I mean, I am open. We don’t turn down revenue if it’s sizable we also are a lot more picky about maintaining a lot of work for customers then not developing into a six or seven figure revenue opportunity just because, we got limited resources and we recognize that’s not why we are here, we are here to go after and I completely get that.

James Leiberman – Wells Fargo Advisors

We are really pleased with the focus and the opportunities that lie ahead. Thank you very much.

Jess Jankowski

Thanks, Jim.

Operator

Our final question comes from the line of (inaudible) Your line is open sir.

Unidentified Analyst

Yes, hello, Jess.

Jess Jankowski

Hi.

Unidentified Analyst

How are you?

Jess Jankowski

Good how are you?

Unidentified Analyst

I’m doing well. Thank you for taking the time and taking my questions. Just, maybe a picture from bird’s eye view of what you are thoughts are on Europe opening up to – approving UV filter, being zinc oxide, I know there is some good stuff.

As seen in the plus side, but what’s your view and then on September 6 is apparently when you are going to stop the building on the approval or something to the effect, any thoughts, or any comments on that?

Jess Jankowski

Sure, I don’t have a direct line into the EU, but I would say a couple of things. The direction has been moving – it’s been moving in a good way all along. We have products that are both larger and smaller which are important in those markets. They’ve also, they are reacting slowly to the fact that the USFDA has taken an approach toward the monograph that has excluded a bunch of organics.

We are making inorganic material and some of the European reaction I think was, okay the FDA now disallowed a lot of materials. We need to look at more – there is also a push for all natural there too. I think, I am not an expert in the European market, but this seems to be a rare case to me where the United States has gone faster on an natural green type application than Europe got. So I would expect that to move now.

When does that move? If they get done at the end of this year and the labeling gets changed, it’s not likely we see volume probably until 2015. Because the way that works is, they do some sampling and they their season typically is in the middle to the late summer where they think about what they are going to order and it somewhat like the whisper number we used to talk about. If they are talking about okay next year I need this much, can you supply it.

So it will probably be around Q3 next year, later Q3 where we know for sure, but I do see there is a positive thing and I would tell you this Ben that, having been in this business for a while and particularly – as we get closer and closer to personal care and that’s one of the things that Kevin also has a pretty good background in personal care. I haven’t seen this much positive momentum in Europe in a long time.

So, it all depends, we are still focused on North America, our resources are – and there is enough market in North America for us to support it. BASF is a perfect partner to exploit Europe and it’s definitely on the radar. It’s also – it’s a strategic thing for them as well.

So I think in the long run, it’s going to grow. I just couldn’t pinpoint, to your point about a bird’s eye view. My bird’s eye view probably isn’t much better than yours and it may even be worse. If you are keenly focused on this only and I don’t know what your background is, but I am on a bunch of stuff. But we are very close to BASF, I’m there a lot, Kevin is there a lot, our VP of R&D is there a lot and I think things are going to move in a good direction.

Unidentified Analyst

Gotcha. And you mentioned, pretty much flat revenues for the rest of 2013, if I recognize correctly?

Jess Jankowski

I mentioned that, I think the 2013 revenue is roughly going to be around where 2012 was. Things change rapidly in terms of – one of our problems is that, it’s kind of like when the United States gets a cold, some other countries are in the hospital, when our big customers change orders at the last minute it can move a quarter by 10% pretty easily. I would say that, roughly, year-over-year I don’t expect to see growth.

What I do – what I am optimistic about is, as I mentioned, we lost over $1 million worth of revenue that we fully expect to move and when we made it up that’s one of those things that’s really hard for me again to talk about, gee, we made up some revenue but we lost enough that it was a watch. But I am optimistic because the cycles and these products are long.

The lifecycles are long and some of these things that are winding down, the Dow business in particular, we started working with them in 2003 or 2004, so, I can’t say that all of our new business is going to be 10 years in the growing, but I can say that we are replacing the business we’ve lost.

Unidentified Analyst

I pick that up through the various 10-Qs. So truly, such a – revenue is coming very, very lumpy. It’s really what the word is, it’s not really something to look at, I guess with the quarterly revenue tomorrow on an annual basis, it would be a better proxy in terms of growth or even, that’s really hard to look at numbers down in that sense. But, the last thing on this, on the energy storage obviously, the batteries, is that the fundamental part of what we spoke about in the past? Is that what you are talking about when you talk about fundamental new particle or is that’s something that…

Jess Jankowski

Actually no, we have some other things we’re working on, that application – we have – part of it is we’ve done some IT work that we can’t really disclose. We filed it all in a confidential filing. So I don’t want to get into too much detail with that. The application there is something that we know how to make, we’ve known how to make, we discovered a way to use it that was more viable.

We’ve leveraged some additional resources to work our way up the food chain both technically and commercially and we think that, we’ve got a good player. I actually, I think we’ve got enough things going forward that we have a pretty good – we have pretty good prospects as the next few years unfold, I realize it’s frustrating from an investor’s perspective, because we’ve suffered from a degree of flatness,

But I look at it and think we are in pretty good position. I am pretty comfortable - comfortable is a wrong word, I am pretty happy with where we are at given what we have. I always wish that we would be growing faster and bigger and more profitably and it’s one of those, keep two balls in the year here relative to cash flows. But again, at the end of the day ROI is more critical and you have to balance those two things.

Unidentified Analyst

So the new particle that is something different than the energy storage application, is what you are saying or that the patent is something different than the energy storage?

Jess Jankowski

I actually don’t want to answer that question, because it’s one of those questions, it’s like forget, that’s – you pull it and it’s got to keep on going and going. Those two things are intertwined. If I answer anything more directly I am going to potentially put a risk either the marketing effort or the IP that.

You know what, there is basically a perspective, that once you start disclosing something that you filed in confidentiality, it’s no longer confidential in the patent office perspective changes as well and I prefer to do it the way we thought.

Unidentified Analyst

No, no, I just – don’t quite understand what you guys were getting at, and then my last, just in terms on the energy control products, I know there is – I have a lot of friends in the glass business and we talk a lot about this and they are very interested in this product and would invest quite a bit in your company if we had some sort of performance values or were able to see what the actual product is, can you give us anything?

We know that, Guardian for instance makes a product that’s pretty good, but it’s almost fairly makes it into the government credits for alternative or for green energy credit or whatever it is. Is it better than those or better than everything? Is it – allow us more, and is there anything you guys can give us at all…

Jess Jankowski

I think you are going to have to wait and see, we’ve got some things developing in that area. I imagine probably not Q3, potentially in the Q4 call or after that we should have more to talk about and you are free to invest in the meantime if you wish, that’s is free but I just can’t get your hand any further.

Unidentified Analyst

Okay, thank you very much.

Jess Jankowski

All right. Thank you.

Unidentified Analyst

Bye.

Operator

(Operator Instructions) We have a follow-up question from the line of Bill Chapman of Morgan Stanley

Bill Chapman - Morgan Stanley

Sorry guys, just two more quick ones. Is your R&D expense, do you anticipate that churn lower or still maybe higher in the next six months?

Jess Jankowski

I think the same. I don’t expect to change significantly.

Bill Chapman - Morgan Stanley

And are you, second question, are you going to be considering going out to investor conferences or, are you going to continuing to employ your same strategy?

Jess Jankowski

I think we are going to employ the same strategy for a little bit, if that’s really part of the problem with this business, because this is not a quarter-to-quarter type business and I think, until we get the point on the board there is some significant things to talk about that are more or less game changing.

I realize it’s important for people to be aware of our company, but I also recognize that at the end of the day, everybody wants us to have results and if you don’t know me and you are not on the call, and you just pull up our 10-Qs, we really haven’t generated exciting results. I completely understand that and I am troubled by it obviously, it’s a focus.

So, I think we’ll wait until we get to the point where we are starting to generate some different things. And we can actually talk a little more, because, one of the frustrating things for me of course is, I am a lot like all of you and I am listening to myself not give you complete answers, it’s frustrating and in an Investor Conference, that’s – it’s just as frustrating.

And I think two things, that having enough to talk about and also winning for some serious success, and I think the third thing which we probably don’t talk enough about is, given our size, I am very involved in the sales and marketing process as well as in the day-to-day management process of the company.

So, spending the time to do that, I just have to weigh it economically and say if – we use to do more of it and you are right. If I spend three days a quarter doing that and three days a quarter I either not here or I am not at various customers. And I, at this point think, it’s time that is not here but I do hear what you are saying and I realize at some point, it will be advantageous to all of our shareholders for us to do that and I just don’t think we are that point yet.

Bill Chapman - Morgan Stanley

Okay, thanks again.

Jess Jankowski

Thank you.

Operator

And I am not showing any further questions in the queue at this time sir.

Jess Jankowski

Okay, well thank you and thank you for your questions and your engagement. We are fully confident that we have the team, the knowhow, the products, the strategy and more than enough potential to achieve our goals and I hope everybody can take that away from this call. We do appreciate your continued support. As always we try to be available for any follow-up questions you may have, but again, there is some bandwidth issues. We appreciate your participation and hope that you all are able to enjoy the rest of your day. Thank you.

Operator

Ladies and gentlemen, thank you for participating in today’s conference. This does conclude the program and you may all disconnect. Everyone have a great day.

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