TransGaming's (TNSGF) CEO Dennis Ensing on Q2 2016 Results - Earnings Call Transcript

| About: Transgaming, Inc. (TNSGF)

TransGaming Inc. (OTC:TNSGF) Q2 2016 Earnings Conference Call January 28, 2016 10:00 AM ET

Executives

Dennis Ensing - CEO

Ankit Patel - VP of Finance

Analysts

Brent Todd - Canaccord Genuity

Operator

Good morning, ladies and gentlemen. Welcome to the TransGaming, Inc Second Quarter Fiscal 2016 Financial Results Conference Call. I would now like to turn the meeting over to Mr. Dennis Ensing, Chief Executive Officer; and Mr. Ankit Patel, Vice President of Finance. Please go ahead, gentlemen.

Dennis Ensing

Thank you. Good morning, everyone. I'm very pleased to welcome you to TransGaming’s November 30th Q2 fiscal 2016 call. Thank you very much for joining us. With me on this morning's call as usual is Ankit Patel, TransGaming's Vice President of Finance. Before we provide our discussion of the highlights for the quarter and other comments, Ankit will review the standard Safe Harbor statement. Please proceed, Ankit.

Ankit Patel

Thank you, Dennis, and good morning, everyone. Before we get started, we want to emphasize that some of the information discussed on this call will contain forward-looking statements within the meaning of applicable securities legislation.

Forward-looking information presented or discussed is based on a number of assumptions and subject to a number of risks and uncertainties, many of which are beyond the company’s control that could cause actual results to differ materially from those that are disclosed in or implied by such forward-looking information.

For a discussion of these assumptions and risks and uncertainties, you should review our filings with securities regulators, including our 2015 Annual Report available on CEDAR.

During this call, we will also discuss both GAAP and non-GAAP financial measures. A reconciliation between the two is available in our MD&A for the three months and six months ending November 30, 2015.

Dennis Ensing

Thank you, Ankit. We had several important accomplishments in the recent quarter that flow from our key focus of building our base of growing scalable revenue. In Q1, we laid the foundation for these, making key investments in our HTML5 base platform to both support the direction of key pay-Tv operators in our pipeline as well as our smart TV distribution footprint. First, this investment led to the launch of our subscription-based cloud gaming service, GameTree TV GOLD on Samsung smart TV shortly after the second quarter ended.

Also, as we've indicated for several quarters now, the new DISH Network, one of our flagship pay-TV operator accounts was making a significant transition of its device base to its next-generation Hopper boxes. DISH support and marketing attention was completely devoted to this transition, leading to a steady decline in our legacy satellite TV game service over the past 18 months. As of the end of January, this legacy service will be taken down by DISH, but as announced subsequent to quarter end at CES, we've an agreement with DISH to provide a new game service called Hopper Arcade. This service is HTML5 browser-based and a true justification for our investments there. DISH's objective is to replace all of its legacy devices with Hopper boxes and we are very excited about growing our service and the related revenue there again. Hopper is positioned as the entertainment hub for the home with our game service anchoring the apps and other entertainment options offered to DISH subscribers.

And on top of these two major accomplishments, we also follow through on our plans for premium content by introducing the first social casino game on any connected TV anywhere. Slots XL was launched right after quarter end at Free in France, our other flagship pay-Tv operator-based service. And we plan to launch Slots XL on both smart TVs and other over the top devices imminently. Our premium content including social casino games is monetized differently. It is free to play with in-app purchases similar to the mobile market where this revenue model is very lucrative. We are encouraged by the early indicators of revenue performance of this category of content since launch and look forward to sharing more details in the upcoming quarters.

As reflected by our recently announced collaboration with Espial, we also continue to search for and enter into partnerships that will extend our reach of pay-Tv services to other key markets and return for shared revenue from game distribution. Shortly, Ankit will offer some detail and discussion of our Q2 operating results. I would like to be clear however that we intend to grow revenue profitably and are determined to be cash flow breakeven in a shorter period of time as possible.

To this end, we undertook some additional restructuring subsequent to quarter end with reductions to our development team and other operating expenses. We expect that this will reduce the quarterly gross operating expenses somewhere between $550,000 per quarter and $650,000 per quarter.

I announce regularly about this, so let me say it to everyone clearly. Based on conservative expectations for revenue and growth, we believe that this restructuring – with this restructuring, we are on stable further in cash wise for the foreseeable future. We continue to evaluate options SwiftShader, but any proceeds from mid-sale are not required to fund our operations or even be a backup source of cash in case expectations are not achieved. We expect to leverage these reserves for selective strategic investments.

At this point, I will ask Ankit to provide his commentary on the financial results for Q2. Ankit?

Ankit Patel

Thank you again, Dennis. Before I begin our financial review for the quarter, I’d like to note that due to the Nvidia acquisition in Q1 of this fiscal year, we have reported the financial results of the former Graphics and Portability Group, excluding SwiftShader, as discontinued operations in the consolidated statements of operations for the three and six months ended November 30, 2015 and 2014. Accordingly, the figures discussed on this call reflect the financial results of the continuing operations only, unless specifically noted as discontinued operations.

Revenue for the quarter was $0.8 million, up $0.3 million sequentially from Q1 and up slightly from the same period last year. For the six months ended November 30, 2015 and 2014, revenue was $1.2 million and $1.5 million respectively. The quarter-on-quarter increase is primarily the result of one-time professional service revenue of $0.3 million. In November 2015, our average revenue per user, or ARPU, from direct MSO subscription based services, was $3.41, down slightly from $3.50 at the end of Q1 2016. This decline is a reflection of DISH Network transitioning subscribers from its legacy satellite service, scheduled for takedown at the end of January to its new gaming service Hopper Arcade.

We hope to return to ARPU growth in 2016 as we aggressively transition DISH gains channel subscribers to Hopper Arcade, but anticipate a transitory impact on DISH revenue beginning in the third quarter of this fiscal year. On the other hand, we expect to see positive revenue contribution from new stream of in-app purchase revenue this year, as we launch our GameTree casino service across multiple platforms in the coming months.

We also continue to have great success with FREE, resulting in another quarter of positive subscriber growth. More than 85 games are currently offered on GameTree TV with FREE and those games have logged 6.5 million minutes of game play in the past 12 months; with subscriber growth of 58% during that period and a monthly churn rate that remains exceptionally low at 6%. With ongoing marketing profiles and featuring from FREE, as well as the consistent addition of new content, we expect the upward trend in subscribers to continue.

On the expense side, cash operating expenses consisting of total operating expenses net of amortization and stock based compensation, came in at $0.9 million for the quarter, down $0.3 million from Q2 of last year and flat sequentially from Q1 2016. Large portion of this decline is attributable to the assignment of the Company’s Toronto office lease to Nvidia in Q1; reflected in the decline in G&A expenses overall during the six months ended Q2 2016. As a result of the assignment, total savings from the remaining term is approximately $2 million.

We recorded gains on foreign currency exchange of $0.2 million during the quarter and $1.4 million for the six months ended November 30, 2015. The gains are primarily the result of revaluing U.S. dollar inner-company loans made to our foreign subsidiaries combined with the weakening of the Canadian dollar against the U.S. dollar; about a $0.09 swing year-to-date.

Net income from discontinued operations for the six months ending year-to-date was $3 million, mainly drive by the gain on the disposal of the Company’s cross platform portability technology for $2.8 million. Revenue from discontinued operations for the six months ended was down $0.6 million year-over-year as the majority of the customer agreements related to the GPG business unit were transferred to Nvidia early in Q1 2016.

Our adjusted EBITDA loss for the quarter which includes the operating results of discontinued operations was $0.2 million, an improvement of $0.3 million from the same period last year and $0.2 million sequentially from Q1 2016.

On the balance sheet, we closed with the cash position of $0.5 million, up $0.3 million from year-end. The increase is the result of $3.4 million in proceeds from the sale of the GPG unit, offset by the repayment of the BEST Fund’s debt totaling $1.4 million and net cash loss from operations of $1.5 million. We are now in a much stronger financial position than at year-end with no debt on the balance sheet and working capital of about $0.5 million.

As mentioned earlier, we made some necessary reductions to our development team this past December, which will reduce our gross quarterly cash operating expenses going forward by $250,000 to $350,000. We are confident these changes will put us on strong financial footing for the remainder of the year and beyond. With this cost restructuring, 2016 cash flow is expected to be positive even without tapping any of the proceeds from the expected sale of SwiftShader or collection of the $0.5 million in refundable tax credits.

We’re also considering very strategic transactions including the divestiture of certain assets as well as business combinations in order to further enhance shareholder value. Achieving profitability as revenue scales is a key priority, and with a clean balance sheet and a significant reduction in expenses, we are confident we can achieve this before the end of this before the end of this fiscal year.

With that, I'll turn it back over to you Dennis.

Dennis Ensing

Thank you, Ankit. At this time, we'll open the lines for questions, so turn it over to the operator Wayne to facilitate this. Wayne?

Question-and-Answer Session

Operator

Thank you. We will now take questions from the telephone lines. [Operator Instructions] There will be a brief pause, while participants register. Thank you for your patience. Our first question is from [James LeCarre], a Private Investor. Please go ahead.

Unidentified Analyst

Dennis, how are you doing?

Dennis Ensing

Hi James.

Unidentified Analyst

How things going?

Dennis Ensing

Really good, as I, hopefully just reported.

Unidentified Analyst

Yes, I see that. I think there's been a nice transition in this quarter. I'd like to get some more information on some many MSOs that could be coming online shortly.

Dennis Ensing

Okay.

Unidentified Analyst

Maybe percentage or how close you are to inking some deals?

Dennis Ensing

Well, of course, our two flagship services are with DISH and Free and then we've talked about those regularly. We also have existing partnerships and are distributing content through partnerships on Virgin in the UK, on AT&T in the U.S. as well as a couple of other ones. At this point, I don’t think in terms of setting out where we are in the pipeline. These are long sales cycles, there have ebbs and flows to them, and putting a percentage on the likelihood of closing a new one in the next couple of quarters would probably not be a healthy thing to do. Certainly, you're welcome to look at the top operators around the world and know that they're all in the pipeline and all have ongoing contact at various points in time. I think all of the major ones we've been in touch with again have moved along in the last quarter. And I'm optimistic, we'll see a couple more this year.

Unidentified Analyst

That's excellent. I'd like the fact that you had trimmed the budget down and it looks to me like you are going to achieve your results of breaking even by the fourth quarter. That's extremely beneficial to everybody. I think it's a great thing.

Dennis Ensing

Thank you.

Unidentified Analyst

And my compliments to you guys by the way that was a yeoman's show, that's not something that goes unnoticed. The last thing is the SwiftShader. Are we still on track with that, nothing to derail it?

Dennis Ensing

That's correct. I think in the past, I've suggested that we were trying to balance the timing of that transaction between cash now and maybe more cash later. I think we made the decision to proceed as quickly as possible with respect to that, so hopefully we'll have some news on that in the coming quarter.

Unidentified Analyst

Excellent. And then my last question is Espial, that's something new to us obviously, it's a big Canadian firm, correct?

Dennis Ensing

That's right, that's right.

Unidentified Analyst

And that gives you global footprint.

Dennis Ensing

That's correct.

Unidentified Analyst

So, in other words, you can go out directly to the TV sets, I'm just trying to get some background for myself on this.

Dennis Ensing

Well, actually there -- as oppose to we already have a global footprint directly to the TV sets through our partners and with all of the operators. What Espial does is gives us another partnership into operators that we're not currently into.

Operator

[Operator Instructions] The following question is from [Jill Oakli], a private investor. Please go ahead.

Unidentified Analyst

Hi Dennis.

Dennis Ensing

Hi [Jill].

Unidentified Analyst

Listen, I would like you to expand a little bit more on the Slots which were launched few months ago, especially with Free, what kind of traction we've had so far and what kind of expectations we have for the coming quarters and especially quarter -- following months instead of quarters? I understand that Free wanted those Slots to be launched, but now the reaction from the customers, how is it?

Dennis Ensing

Yes, it hasn’t been very long [Jill], it's been maybe not even two months yet because we launched right at the end of November. And so the first -- in fact, the first set of data we had was for December and we had no -- on purpose because there was -- we considered a data launch. We didn’t do any marketing and promotion, but in-spite of that, we were actually very encouraged with both the user adoption, the retention, so in Slots, we're measuring some different things. We certainly on the subscription side like to see game play, the number of games that people play and how engaged they are. On the free to play side, we are also looking for both the retention of users in the short term but also over longer terms.

And we’ve been benchmarking our statistics of retention as well as conversion to pay and what the ARPU is against our partner’s comparable statistics. And we have a partner that was the original developer of this game based in the UK. And so we’ve been able to benchmark our statistics against theirs and they certainly have slots available there for long enough that we have a pretty good track record and data. And interestingly, in the first month, we were bang on what our expectations were, both with respect to retention, conversion and the average revenue per paying user. And so those are the numbers that we’ll be able to report to you over the next little while.

Again, as opposed to singling out a single operator, we’ll be launching the same game on Samsung eminently. It's been in QA there for the last couple of weeks, so it could literally be any day or any week now. And once we have -- and then also subsequently on other TVs as well as over the top services and as soon as we could start aggregating that result, so that confidentiality is maintained. We’ll be providing those statistics. And you’ll know what the revenue is from that premium content.

Unidentified Analyst

Does that mean Dennis that that division the slots could become a major asset for the TransGaming?

Dennis Ensing

We believe so. Longer term, there are -- assuming that we have a really good and growing base of users, we’ve clearly seen transactions in the mobile space for these top social casino companies that are attractive. But for now, we’re building the business as a business unit. And we’re setting our sites on ensuring that we’re successful with it and that our users are excited by it. And at some point, we might turn our minds to a strategic transaction with somebody in the space that will bridge from mobile to smart TV. But one of the determinations we made was that 150 million smart TVs around the world was a great frontier for this type of content, and slots is much more exciting to play in a lean back big screen, high definition environment. And it is huddled over a smartphone or a tablet. And that we think is very exciting and we really do think that the adoption that we’ve seen in mobile will carry over and looking forward to that kind of success.

Unidentified Analyst

And is Hopper going to be also available in all the slots, be also be available on Hopper?

Dennis Ensing

Not initially. We’re working with DISH on that. With operators doing a free to play within that purchases model with operators, sometimes it's a little difficult to work with, because they don’t want to see small charges onto the cable bill repeatedly through the months. FREE didn’t have a problem with that. And so our first priority with Hopper is to transition our legacy satellite subscribers to Hopper and provide a really great subscription base game service to them as well as to all of new Hopper providers. Then we’ll look at options for premium content there later on this year.

Unidentified Analyst

Finally, I have membership with Dell. And we have an access to some games which are free, and I imagine that that’s the cost to us through our usual piece. Is there any way we can try to look into that fashion?

Dennis Ensing

With this model, absolutely and there are operators that we are looking at that business model with where they’re not -- we’re doing it on a pay per use or pay per subscription basis is one option, and the other option is making all of the games and the whole catalog available to the entire subscriber base on a free basis; and there are couple of operators who are currently discussing that way.

Unidentified Analyst

I see, okay…

Dennis Ensing

And by the way, Dell was a customer in the past and certainly when they transitioned to five, it took them a while to provide a game service. It's still for us a fairly small service compared to some of the other ones that we’re pursuing. But we certainly had a relationship with them in the distant past.

Unidentified Analyst

Well, hopefully we can remove that situation. I think the results are going in the right direction and hopefully we can see a breakeven and even cash flow positive by the end of May.

Dennis Ensing

I accept that challenge.

Operator

Thank you. There are no further questions registered at this time. I would like to return the meeting to Mr. Ensing. Actually, we do have another question.

Dennis Ensing

Yes, go ahead.

Operator

From Brent Todd from Canaccord Genuity. Please go ahead.

Brent Todd

I mean on the surface I mean there was -- it was an okay quarter, right, like there was that one 300k that sounds like kind of a one-off that skewed things, but you kind of -- if I'm reading it right, your Free TV in France income was sort of making up for what you've been losing with DISH as a transition to the new box. Is that kind of the way I should look at it?

Dennis Ensing

Yes, that's over the last 12 months. That's definitely been the way it's been working, yes.

Brent Todd

So, it sounds like you did a lot like you've accomplished a lot, signed a lot of deals et cetera. You've launched with Samsung this GameTree GOLD, is it too early to tell or are you seeing any traction there?

Dennis Ensing

We're not seeing as much traction as we would like Brent, however we are seeing traction and I do think it's too early to tell. The bottom-line was the HTML5 investments we made were primarily targeted to Hopper because that was going to be HTML5 browser-based. And the provision of the same kind of service across the smart TVs was principally a land grab which we did a couple of years ago with an ad-based model with very disappointing results. We are seeing much better results.

By the way, we're also working on a better ad distribution. We're seeing ad networks paying more attention now to the smart TV platform which is something -- it gives them a differentiation and offers the opportunity to deliver some video based ads into an environment where people are very used to seeing those. And it is a new captive market for those ad networks, so we're seeing transition both in terms of a pick-up in the ad revenue that we're generating from the free content there. We're also seeing some conversion to subscribers.

Both of those we will be able to talk about again as well. I think your summary of the announcements we made were completely consistent with what I shed out as priorities last year in making sure that we both restructured and repositioned the company as well as focused on every opportunity to seed areas where we could grow the revenue. And really, this quarter was kind of the combination of that where all of those investments were seeded and now we're going to nurture them and watch them grow.

Brent Todd

If you're sort of going forward, you've sort of spread your platform out in a few directions, want a few seeds. Going forward, what should we be looking for or where do you think the most immediate impact will come from on a revenue basis?

Dennis Ensing

Yes, our -- I think consistently our preferred channel of distribution channels are through operators. The partnership works well because of the incentive that's built into the revenue share model for them to promote the service. We have a captive audience of their subscriber bases and so that still is the foundation and having a couple of more of those would be sort of the priority and where the expectation is.

However, our expectation next and maybe even greater than that, but we're not sure yet would be around the premium content and in-app purchases and for secure these slots. We think with not just the game being made available to a flagship pay-Tv service like FREE, but globally across 10s of millions of TVs that as successful as that content's been on mobile, we're very bullish on the opportunity on our smart TV network. So I would put that as maybe the most -- that's the one that we have the most hope and expectation for this year. And then followed by both the advertising and subscription based revenue from GameTree TV GOLD.

Brent Todd

So, I guess you’re hopeful that the DISH stuff starts picking up again once Hopper is released, which is like eminent. I guess it’ll take a bit to rebuild. Is that correct? And then secondly, it would be a successful year, I am talking 2016, if we saw couple more operator come aboard versus just DISH and FREE?

Dennis Ensing

Yes, and I think Ankit did highlight that we lift this transition between the taking out the legacy service and the launch of Hopper Arcade within a couple of months. We will see a transitory affect on revenue couple of months where revenue from the Pay TV services will be down slightly. But Hopper Arcade, the Hopper devices are out there and we’re just working with DISH to get the game service launched, and we’re making excellent progress there and the target date is within Q4 of this year, of our fiscal year. And when we talk about a couple of other operators, that would be in the context of calendar 2016, not necessarily this fiscal 2016.

Brent Todd

That’s what I meant.

Dennis Ensing

But consistent with what I’ve said before, some of these have the potential of being game changers and maybe slots in particular. But kind of consistent with pattern that I’ve -- and the expectations that I’ve said before is we’re doing this -- the revenue growth is going to be consistent and scalable over time. There isn’t going to be something in our foreseeable future that double or triples revenue in one month or one quarter unless something crazy like slots takes off. And I think that’s the other part of this is that our strategy has been to say this is a long term game we’re in and there are some potential short term buzzers that I don’t want to set the wrong expectation that slots is going to create a massive bump all of a sudden. We’re very bullish and very excited about it. And I think it will prove to be something really interesting to watch over the coming months and couple of quarters.

Brent Todd

And then any color around -- you mentioned some other technologies you can tell besides SwiftShader. Would we look to see some of those deals in 2016? And I am not talking fiscal.

Dennis Ensing

Possibly, I think SwiftShader is the main one that Ankit was referring to. We certainly been looking and I’ve been pursing some M&A on the GameTree TV side and largely to look for a way of building some synergies around distribution, as well -- of content, synergies around the investment that’s made in the content and getting wider distribution for that content. And there are several game providers smaller than us that might be worth having a look at and there are others that are larger than us too that provide some interesting opportunity. So, those will be what we were probably referring to there from a technology standpoint, largely partnership driven. And I think because of the frontier, this next frontier of opportunity on smart TV is wide open. We want to make a real move into it.

Brent Todd

Last question, any contemplated deal with SwiftShader, would that be similar to the last deal, would it likely be a U.S. entity paying in U.S. dollars?

Dennis Ensing

We like the U.S. dollar question, we really do. We made the decision several years ago to report in U.S. dollars and I am looking at Ankit wondering what impact would be dollar had on our Canadian equivalent revenue these days. But absolutely everything we do even if we were Canadian entity Brent, it would still be a U.S. dollar transaction. These days the only Canadian dollar expenses we have or transactions we have are the modest expenses for our corporate office here in Toronto. But all of our revenue transactions are either in dollars or in euros, I suppose. So that’s, from a conversion standpoint, that’s a good thing. But our royalties, our revenue share is going out, are also U.S. dollars. We certainly like the effect that it had for us.

Brent Todd

Lastly, how many employees do you have now, we’ve sort of done a lot of restructuring over the last 18 months?

Dennis Ensing

Sure. I think approximately now around 25.

Brent Todd

Are you to the bone or….

Dennis Ensing

No. Yes, operationally, we are definitely to the bone. I think anything more will be -- the concern would be to affect revenue and we certainly took advantage of the investments we made to get these new services up and running and really the focus then was to take that -- to realize that we'd made the investment in the content in the Hopper platform in the Slots to excel content. And those initiatives could drive revenue and cutting to the bone like we did wasn’t going to have an effect on revenue. So that was the idea. The idea was make the investment, launch, drive revenue and de-cash for breakeven.

Brent Todd

All right, so you've made the investment. You've launched and touchwood six months from now we're seeing the fruit to that.

Dennis Ensing

You got it.

Brent Todd

Got it, well, good luck for that all.

Dennis Ensing

Thanks.

Brent Todd

As I said, I know you guys will work and I can see that. I see the news releases and the launches, so you just need a little bit of luck getting some traction here.

Dennis Ensing

I'm with you.

Brent Todd

Yes, I think it'll make a big difference if you can get on the other side of profitability, that's really what the -- I think the market is scratching its head with you guys right now at these levels.

Dennis Ensing

Yes, that's withering.

Operator

Thank you. The following question is from [James Le Carre], a private investor. Please go ahead.

Unidentified Analyst

Dennis, I just want to make a comment, you're doing a great job. You don’t hear that enough, I think you need to hear it more often. You had a tremendous transition so far and you're doing everything right as well, it's a good sign and I think there's a lot of detail, it doesn’t come out in these calls. It should be appreciated and that's fine. And good luck.

Dennis Ensing

Thank you, James.

Unidentified Analyst

I know you're going to do it, so I'm very happy about that. And I'm content, so keep up the good work and add everybody in the back there for a job well done.

Dennis Ensing

Thank you. Appreciate it very much.

Operator

Thank you. The following question is from [Jill Oakli], a private investor. Please go ahead.

Unidentified Analyst

Hey Dennis, I want to have some for my money. Listen, I want to know what kind of pricing do you use and what kind of -- can you walk me through the fact that -- of the situation where the pricing for playing the games and the way it works?

Dennis Ensing

The subscription-based service?

Unidentified Analyst

Yes, yes.

Dennis Ensing

So our standard model has been 499 a month in either Euros or U.S. dollars. We had a slightly different model with the DISH legacy service because with the limitations of satellite bandwidth, we had to package up -- it wasn’t an all you can -- necessarily an all you can play service.

Unidentified Analyst

Yes.

Dennis Ensing

So that's for 699 a month, there was a smaller package of games and in fact at 1009 a month, you could have an all you could play option or all content was available and so that on an ARPU basis, that was favorable. With Hopper Arcade, we haven’t finalized pricing. It maybe 599 a month or 699 a month, but we typically have found, historically that 499 a month is a really good threshold and not a big barrier to entry and keeps the churn low in terms of people seeing it on their bills and being content that with the kinds of activities that we get engaged with programming wise, that it's good value for their money.

Unidentified Analyst

So bottom-line was that -- I mean, that's the pricing that after major studies seems to be fair value whether for the client or for the company.

Dennis Ensing

Correct, it seems to be the right balance. Look, I'd love to charge 1099 a month, but then it sounds a big deal, right?

Unidentified Analyst

Yes.

Dennis Ensing

Then it's the balance between adoption and pricing and that's always the tension, right. And so we did a lot of that kind of study on the smart TVs in the fall and we played with pricing from $0.99 a month up to 599 a month.

Unidentified Analyst

Yes.

Dennis Ensing

And we still came back and realized that kind of the best balance seemed to be 499 a month, which is what the GameTree TV GOLD subscription is available for and that subscription removes the ads, gives you access to more content and gets you newer content sooner than the free to play uses or the ad supported users.

Unidentified Analyst

Sounds good. A final question, not the best one. We know where the price of the stock is and the press there's nothing happening, what are the positions of the management to that effect? Any -- what's the feeling of the Board of Directors? Do they want to get involved into the company more or do they want to stay on the sidelines and do nothing?

Dennis Ensing

I can’t speak on behalf of the Board Jill. People know that both Ankit and I did jump in late last year and certainly I continue to examine when and where that should happen again. I can only speak on behalf of myself. And right now, management is, from a stock price standpoint, the greatest influence that we can have isn’t through buying the stock. We can certainly provide emotional support, if that’s what it means to buy the stock. Our job is to execute and deliver on revenue, profitable revenue, and ensure that the shareholders are seeing value delivered through the execution of the business plan, and that’s where our priories lie.

Unidentified Analyst

Understood, on that effect, the follow up on that is, I surely hope that there is no options getting ready to be distributed through directors and whatever, except for maybe employees who would want to keep.

Dennis Ensing

Yes, we want to keep all of our employees for sure.

Unidentified Analyst

Now, you understand what I am saying…

Dennis Ensing

Not exactly…

Unidentified Analyst

Maybe the language barriers sometimes is not clear enough.

Dennis Ensing

No, your message was received loud and clear.

Unidentified Analyst

Perfect, appreciate it.

Dennis Ensing

Okay, thank you.

Unidentified Analyst

Have a good day. Thank you.

Operator

Thank you. The following question is from Brent Todd from Canaccord Genuity. Please go ahead.

Brent Todd

Follow up past comment, but at some stage you guys are responsible for turning this ship around. I hope you have a lot of shares. I’d like to see management for shares. And down the road, a tasteful number, I wouldn’t mind you guys getting a lot of option to ensure that you want to stay with this project and when we guide it going forward. So, I am personally not opposed to you guys getting aligned with shareholders.

Dennis Ensing

Well, we are aligned Brent and certainly I wouldn’t dispute that and I hope that our actions reflect that.

Brent Todd

So far so good, yes.

Operator

Thank you. There are no further questions registered at this time. I would like to return the meeting to Mr. Ensing.

Dennis Ensing

Excellent. I enjoyed the dialog today from the participants and I’d like to thank everyone for dialing in, and especially those that have good questions and allowed the discussion to be made available to everybody listening. So thanks again for your time and as always the questions. And I wish you all a very good day. Thank you. Bye-bye.

Operator

Thank you. That concludes today’s conference call. Please disconnect your lines at this time. And we thank you for your participation.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!