BitNile Holdings, Inc.
Q1 2018 Earnings Call Transcript

Published: 22 May 2018

[Operator:]

Welcome everybody. We are about to begin the webinar first quarter 2018 financial review. Before we do so we will start with the Safe Harbor Statement and then I will turn the meeting over to Mr. Milton Todd Ault III, CEO and Chairman of the Board of DPW Holdings as well as Will Horne, CFO of DPW Holdings. This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 including but not limited to statements about DPW Holdings Inc. DPW’s expectations regarding the market demands, future financial performance, the implementation of strategic plans and future growth. These statements are made based upon current expectations that are subject to known and unknown risks and uncertainties. DPW does not undertake to update forward-looking statements in this presentation to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking information. Assumptions and other information that could cause results to differ from those set forth in the forward-looking statement information can be found in this presentation and in DPW’s filings with the Securities and Exchange Commission, including its most recent periodic reports including the risk factors listed in the Form 10-K and for the year ended December 31, 2017, as amended, available on the website and on the Securities and Exchange Commission’s website at sec.gov. At this time I would like to turn the call over to Mr. Milton Todd Ault III.

[Milton Todd Ault III:]

Thank you, Darren. I will say this is probably one of the more exciting calls I've ever been on. We just ended the first 90 days of the year in terms of the reporting period. It is a little unusual that we're in May and we're reporting March 31, that always kind of skews a numbers a little bit in terms of what we're talking about presently versus the future. I'm going to take my time today on the call to cover some really important highlights because while I don't pay attention to social media except on the Company's Twitter account where we do put out some information there is a lot of questions being asked that lead me to believe that people are somewhat misunderstanding what's going on with the company. Excuse me anyone on the call please mute your phone if you're not talking. Thank you. So let me start of by saying the quarterly results quarter over quarter, year over year were great. They were largely due to acquisitions as everyone knows this is an acquisition story as we transitioned an old line business to a more of a diversified holding company. So I will cover the results very quickly and that as we ended the quarter at $5.196 million in terms of total sales versus last quarter of about 3.1 million versus last year at 1.628 million, a pretty dramatic increase but part of the education that I want to give to everybody about what we look like from an acquisition perspective is when you're in the middle of acquisitions and growing your reporting is very behind relative to the time that you encapsulate the acquisition you made versus recognizing the revenue. So for example many of you know we're in the middle of acquiring Enertec but the actual closing date didn't happen in the first quarter therefore the 2.5 million to 2.7 million in revenue that would have been in there which would have picked this number higher is not include. So there is no Enertec revenue in the 5.196 million. Now the company's acquisition of Enertec was approved by the Board of Directors today, a little bit before this meeting right before this conference call. So assuming that Enertec acquisition closes in the next 24 hours which we believe it will maybe 48 but we're pretty sure it's going to be around 24 hours or so. Assuming that closes you're only going to have 40 days of this quarter left to include their total revenue and their backlog right in terms of when you're reporting so you should see a very dramatic increase in the total top line revenue as you integrate each one of our acquisitions. Let me take another step and explain that our hospitality business even though we're a lender to it since last December is not reflected in the financials, if you would have included in those the financials you fear hospitality business or you see at least an additional 1.5 million to 1.750 million of first quarter revenue but that won't be introduced until this quarter and so I was hoping that we'll maybe could comment on that or I'll get back to that in a second, I will bring Will into comment on those that integration as you see the top line revenue ramping and the reduction of our capital needs which would be in a bit reduction in the total capital need to be raised but a dramatic increase in the total top line assuming we don't make any more additional acquisitions. The gross margins for the quarter decreased from 43.5% to 26.9%, a really simple answer here. So we have pretty decent gross margins but the first few machines being made by MTIX, there are kind of a learning process and so we have a fixed rate of profitability on the first few machines and then our profitability increases as you ramp the number of machines as you go out and so that's an important part of understanding why the gross margins are affected. Now we did get to report for the quarter 1.7 million plus of revenue from MTIX, in fact we reported 1.793 million from MTIX and that is included for the quarter and what we've said in our guidance here is that we expect to recognize between 6.4 million and 8 million of total revenue for the MTIX purchase order that would reduce the 50 million to 42 million if we collected the full 8 million for 2018, this will be an important thing going forward because you'll start to see Coolisys revenue ramp as they continue to manufacture machines and bring on that backlog. As many of you probably saw on the press we did report a backlog of approximately $68 million and that backlog should increase over time as Enertec is integrated and we start to see orders from the Indian government and more orders following through FMF and as we transition to looking at FMF, Foreign Military Funding one of the strategic reasons why Enertec is going to be part of the loop here and why we acquired them is because now Enertec is going to have access to U.S. defense money because they're now going to be a U.S. subsidiary of a U.S. company approved for foreign military funding and defense contracting. I'm going to transition over to the assets of the company now and then we'll just hold on one second we'll continue to go forward there. The revenue increased, the assets of the company increased by $7.9 million almost $8 million to 38.493 million. Of course once again the quarter ended March 31, we're into May with the acquisition of Enertec and the other capital we've taken in that number is going to be much larger in the second quarter as we approach the end of June that number will get much larger I expect that number to be north of 50 million maybe even closer to $60 million depending on what we lose for the quarter. I will point out to people that when you look at the total losses two really important things to remember, Joe let's switch to the income statement really quick for a second so we can point out to them some things to remember for the income statement. Thank you. So when you see the top line income statement reflecting our total revenues of 5.196 million if you go down to the bottom line you see other comprehensive income and above that net unrealized losses securities. Well our portfolio for our total securities ended in about $10 million. So we have $10 million of either securities held for resell or securities held in our trading account when you add those two together that's about $10 million but what happened was that one of our positions declined in value and so while we didn't sell it we market to the market each quarter. Warren Buffett talked about this at Berkshire Hathaway, you've seen a lot of reports about this in the media about how you will be flowing through everything through the income statement. So you will see a pretty big fluctuation in our quarterly results as you watch our portfolio grow from the 10 million is now we expect it to grow over time. These will be securities held for resell and stuff we hold on our balance sheet and in our that trading account. I expect that number to grow dramatically as we continue to take positions and other public companies and as we continue to be aggressive on the acquisition trail and then what happens with MTIX International their rollout and their hope to listing up to the Nasdaq so that should make for a pretty volatile comprehensive net realized loss or gain so truly in my opinion a wasted number when you look at the fluctuation quarter over quarter of the stock portfolio. The number you want to look at is whether what we sold or what we bought relative to those adjustments. So first time [indiscernible] talk about the comprehensive loss or gain in the stock portfolio, somewhat of a waste of time but it is reflected in our number and makes our loss look dramatically more than it was. I'm sure when people see the $10 million they're not taking into account that $4.741 million was change in the value of our securities value and that really reflective and if you go a little further to total comprehensive income you will see that our net cash charges for the quarter were I want to look that up real quick sorry I lost my way a little bit here with that. I believe the net cash loss number was on a non-cash basis was about $4 million, I'll get that number. Will do you've the non-cash number for the quarter? That will be helpful for everybody. Okay. So I'm going to switch back to the mission statement. We are going to skip around a little bit here because I want to cover some things. We truly are a holding company now. We are truly in my opinion at the end of the quarter. We've gotten in sum of the scale we want. As you can see the asset base will increase. We do have some acquisitions pending as I talked about earlier with Enertec but from a mission statement perspective we truly are moving forward with our mission to have the different categories. Can you go back up for a second please to the different subsidiaries, Joe? So as I skipped around a little bit with the presentation I wanted to cover some topics. Do you see right now the three key holdings we have, Coolisys Technologies and their subsidiaries everybody knows Enertec will be under Coolisys. Super Cryto mining and its operations, Digital Power Lending and its operations You'll see later on in the year the hospitality business will come into play and there will be a fourth holding there and then the businesses that they own in hospitality and then you will see eventually a real estate section pop up there. We're active in the real estate space right now. We're not reporting that as of today but I can tell you we have a very big project that we're working on and we're very excited about that that will change and continue to change the dynamics of the holding company. So if you go back to where I was about non-cash charges, the non-cash charges for our total losses were 4.152 million. So you can see a lot of that the loss was eaten up by non-cash charges for the mark to the market of the portfolio and I encourage everyone to read the press release along with the PowerPoint it will really help with the narrative so you can understand where we are. We try to get a little bit more of a comprehensive breakdown of some of the individual numbers continue. Keep going. Right now if you look at the organizational holding structure you'll see that cool will have Enertec underneath it and you'll see that we increased our position in MTIX International by a little bit of a smidge. We now on a beneficially ownership basis on 83.1%, of course if anyone converts or a founder convert we would be diluted down from there but we do have a large position in the company. We continue to own a position in WSI Industries and Sandstone. Let's continue. We created with the help of a consultant this infographic. It is a kind of a one page outline of everything what we're going on with the holding company the underlying subsidiaries etcetera, maybe a timeline on the right hand side. You can see when you look at the top of the infographic 2015, 2016, highlights 2017 highlights in terms of total assets. You can see that our assets have went from 5.4 million in 2016, the $30 million, 510,000 to 38 million as of today almost 39 million excuse me as of March 31 and that number's going to be closer to 50 million maybe even closer to 60 million depending on some adjustments for the end of June. You can see our revenue numbers which were stagnant for many years. We've done in the first quarter and remembering back to what I said in the beginning of the call we did in the first quarter almost more than half of what we did all of last year and what's a little misleading is that we didn't include all the acquisitions because of closing, timing and other reasons so I'm pretty optimistic that when you see this fairly dramatic growth it will come in-line a little bit here. I'm sorry I'm getting questions here, okay. Thank you. All right, let's go to the next page. We are going to come back to the infographic, I really like this please if those of you contact me I would love to get your feedback on the infographic and if you think you wanted more on to it, those of you who are in touch with me. We covered some of the highlights of comprehensive income, the total loss, total revenue etcetera. Recover the non-cash charges, for the quarter we raised $11.892 million. I'm going to talk about [indiscernible] because this is probably the number one question I get and it is a little misleading because we don't take the money we raise it and just go burn it, we're buying acquisitions which create assets and those assets are reflected and supposed to earn us money and so the relative term is what is the performance we're getting on the total assets we've deployed so when we get to the end of the June quarter let's say we ended at 60 million in assets we wanted to know what those rate of return on those assets were and how well they were performing. We really have laid out the strategy for a long time. I get a lot of questions about someone asked me about like what's happened and what are you diluting on and we have been doing this, we have been on this acquisition trail effectively for I think the better part of like 5.5 or 6 months so people's ideas and their question seem to be so short term but it's almost impossible for me to answer them because the bulk of the questions I get generally are from people that appear to be day trading the stock or really don't are not paying attention to what we're buying and understand how the revenues were ramp. So I really just can't accommodate everybody is concerned about this but the raising of the capital as a holding company, it's pointless to own a holding company without the required capital to grow it to the numbers we want to get. We want to be $100 million plus in revenue and we want to be a $100 million plus in total assets and that takes time and energy etcetera. We're going to move on to an important part of the process here but I was reflecting earlier about what happened with bitcoin in the first quarter, cryptocurrencies we are going to switch to that next let's move to slide 4. I've already covered this slide. We've switched real quickly to a Super Cryto really quick. Thank you. Okay. So this is a very tricky situation with us for the first quarter. We started off in January late December really aggressively installing miners and wanted to get to a certain spot. We put miners on our urban location, we put minor miners in our LA location with a mind-set that we were going to find the best place to mine and we really found that for us in Indiana and so we were very pleased with that but what we learned a lot was that when we were installing miners and you guys know all of you know Cryto Joe, we really discovered that the mining was being affected by how much heat was not being displaced from the miners and we really made a strategic decision towards the end of the first quarter to take our miners offline and move them to Indiana and install them there rather than have them out here in the higher cost facility. So we have our facility in Indiana which we said in my quote is operational it's doing very well. We are credibly pleased with that and where the misnomer is if you look at it, it says we mined 237,000 worth of coin crypto in the first quarter. We're doing more than 400,000 a month every single month now. About 1.2 million a quarter and that number is growing. We expect as we ramp towards 10,000 machines that that number will go dramatically higher, it's not hard to do the math based on what 10,000 machines would produce you. One of the other things that we're doing here within the crypto space which replaced besides doing 400,000 plus a month in bitcoin and litecoin and shape shifting to Ethereum we are in advanced talks to develop our own miner. We have -- we are in major discussions with a major manufacturer of the chipsets to produce our own minor first for ourselves and then available to the public. We want to be a North American company that are competing with Bitmain in the space. So we want to be a North American company that's competing with Bitmain, this is a hyper growth business for us and if you go back and you tie that Coolisys two sister companies, Coolisys is in advanced talks in development and helping us build the miner, they will be our manufacturer, they're building power supplies force that will be integrated and we really think not only will we achieve our 10,000 number but we now have the facilities to allow us to go to more something like 20,000 and we're looking at continuing capacity to be big in this space. The one of the reasons why this is transitioned over time is because these data-centers rebuilding can also be used for AI and so this is become a really collaborative relationship between Darren and his staff at Super Crypto and the staff at Coolisys. So I'm going to Darren an opportunity to talk a little bit about what he feels like about what's going on in Indiana, the transition, the current 400,000 plus a month he's doing and we have said it will be about 5500 miners operational by July 31, and we still believe the 10,000 by the year end. Darren why don’t you make some comments here on what you think are important for everyone to know about what we did in the first quarter and what we're doing now.

[Darren Magot:]

Thank you, Todd. I think the key here is to emphasize the fact that for long term growth we need to build a strong foundation. So we've paced ourselves and we have actually stepped back from an aggressive pace to set things up correctly and establish relationships that will allow us to meet our growth not only this year but into 2019 which we've already discussed how we're going to purchase machines and grow throughout the next year. Unlike our name which really are more than just mining as evident from this graphic we've spent a lot of time and energy at meetings not only with Coolisys, Amos and his team but also with Chipset Manufacturer and [indiscernible] and then also working and modeling out our cloud, mining offerings. Then we are going to launch our next round of cloud mining, sharing up that website, security protocols and preparing for another round which will happen shortly this year. Additionally we're focused on blockchain, mainstream blockchain opportunities. Again to put sort of a technical outside of just a pure crypto play but also position ourselves to support real estate transactions and financial transactions where we know that that's really the future of blockchain and watching growth, but I would just add that there really is no concern about reaching a 10,000 number this year we're well on pace for that and excited about the infrastructure in the Midwest. The team there is forward thinking, innovative, our machines have never run so cool and are delivering us. Bitcoin in our wallet at an incredible rates so we are excited about that partnership.

[Milton Todd Ault III:]

So appreciate that Darren, thank you. I think the decision to move miners Indiana versus continuing to build them as installments Southern California that gave us a little bit of pause and it's important to note too that the cryto portfolio was basically collapsed during January to the March when you saw bitcoin come from 15,000 - 16,000 Ethereum from 1400, you saw all that that basically your kind of mining in place as you mine the asset, the asset went down a price and so it was a really difficult first quarter. I considered it to be kind of crazy where you mine something in real time and it's worth you know 10% less the next day. The stabilization of bitcoin above 7500, 8000 will make things relatively easier for us but our thesis is still really simple here and I'm going to make it really simple for everybody. We believe and we believe will demonstrate to you and the shareholders into the market in the next three to four months we believe that we're not only going to be one of the most competitive price mining companies but we're also going to have our own miners and as we build this out. We believe this is a question of power and it's clear to us that this is a power play whether we're mining bitcoin or any other cryptocurrency or providing AI solution. So I'm very pleased with the progress here the first quarter was a challenge but I still consider this to be a big win for us and we're really active and even at the current pace if you did nothing else things producing 5 million a year of bitcoin and crytocurrency so it's a really good business for us, we're excited and part of. Do I wish the volatility was a little lower in bitcoin? Of course I do. That's something that it's really hard for us to deal with. Hold on a second please. Darren was tapping on my shoulder saying don't forget Todd though. We are staying long bitcoin and we are long term and that's absolutely true. I mean we're a big believer in the fact that there's going to be some replacement here in terms of the currency and it still fits our model so what we want to go do here and so this is something we're credibly pleased with and in the cloud mining thing we have some good consultants with us. We have a nice platform being built we hope that that improves with a decline of bitcoin and the hash rate it has been a little bit of a challenge to watch how that business will work but we think with the data centers we're building we're going to have a lot of opportunities to offer additional services. Can you go back up the Coolisys for me? Thanks. So let's get back to Enertec. Enertec is important acquisition for many reasons, one this is a Coolisys represents a business that's been around since 1969, take Enertec that’s been around 26 years and you connect the small devices we make for the commercial defense and military market but don't forget Coolisys makes one of our top power supplies for data-centers. This power supply runs an existing data-centers today and we think that the combined company of the 60 plus engineers with Enertec and the combined sales organization we have in the U.S. with FMF funding will propel the company. So if you look on a simple basis Coolisys next year if we just did no changes today is going to do about 25 million to 30 million next year in revenue not including their MTIX contract you layer that contract on, you put the company closer between 35 million and 40 million and then you look at them producing a miner in the mining space and the ability for them to come up with more advanced solutions especially with our talks with the chipset manufacture and you have what you have here is a business and radio frequency making commercial defense products, telecom, industrial medical, we're very pleased this is the foundation of the company Amos still continues to run it after many years and he is excited about the growth this morning when we had the conference call to approve the acquisition of Enertec by the Board I think Amos was relieved after year and half of hard work with MICT etcetera. This Amos' team an engineering powerhouse, I think that this is something that can grow for a long period of time and will represent the foundation of one of the holding company's key assets. Now I know you can get a lot of questions about whether this will be sold off or IPOed, there's a lot of opportunity here and I think it's important to people to look and see if DPW is somewhat of as a holding company it's somewhat like private equity I put in my chairman's letter to look at [indiscernible] enterprises so you can understand that ICON Enterprises [ph] recently sold off its casino division and its recently did a deal on its automotive parts division. We will look to do deals that make sense for all of our subsidiaries as we grow them out from commercial defense to hospitality to lending. We'll look to do other deals. I'm very pleased with what's going on here, do you know if Amos is on the call today? Amos are you on the call today? I think you may have been traveling to Israel I don't think he's on the call. Let's switch over to the lending business. Billy, are you there?

[Bill Corbett:]

I'm here, Todd. How are you doing?

[Milton Todd Ault III:]

All right my man. All right. This is the fun part, this is the one of the exciting things as you'll be a lender. Billy I thought maybe you could talk about the kiosks, maybe give them a little bit tidbit about what you're doing behind the scenes of kiosks we talked about at one of the last conferences we presented at and talk about the loans you're making to other public companies and how you're growing Digital Power Lending. I know you're really starting to hit your stride a little bit, you're getting a lot of the deal flow, maybe you can talk about the kiosks a little bit of what you're doing in the ATM business.

[Bill Corbett:]

Yes, sure. Thanks, Todd. So let me ask you quickly give you a little brief overview but you know Todd had mentioned we basically built an incredible California Finance Lending Platform over the last six months. We've created a network I would say with some of the most sophisticated Wall Street Investors that I've ever seen that can with us help us analyze and originate almost an unprecedented deal flow. I mean it's almost like the GM, GMAC model where our lending license allows us to provide capital to our subsidiaries and our subsidiary CEOs which can be very time consuming for them we allow them the capital to go make investments and at the same time we've developed a really interesting network for individuals to participate in deals that would basically be very hard for them to find and we can do that through an online platform, we can offer micro loans which is becoming very, very attractive to investors small investors that get to participate in deal flow that they wouldn't see from Wall Street. As Todd mentioned we're rolling out this kiosk platform terminals if we want to call them that we mentioned in January that our intent was to do that in Southern California. We're in the late stages of rolling that out. It is in Vegas at a conference we started kind of talk about really compelling to the audience, to the investors that were there listening because it's very exciting to be able to sell crypto that we're mining in our facilities on these machines and all of that research that we've done has shown that there is a great need for people to want to buy crypto from the machines these are some of the most incredible machines that exist, they're not really expensive like an ATM machine but they allow individuals to wire money for example with a money transmitting license which we will have. They allow an individual to buy crypto. They can pay utility bill in Mexico City from Los Angeles. So they can buy micro-loans on the box. So we're very excited you know about the vertical integration of being able to mine our currency to offer that to individuals and we are excited, we think that the numbers that we've put together are very compelling, really profitable in short order, it's not a huge CapEx commitment and we think throughout Southern California as we see these machines start to really ramp we will roll them out in other areas but right now we've got some great partners that are going to help us do that. They have been doing it for a long time. They're experts in the space. They're going to run it for us and we're very excited about it. I'm really looking forward to the numbers that we can put up in June ending quarter with the ability for us to bring in friends of 20 or 25 years that are experts in investing in microcaps, I've been building companies for 25 years in microcaps. So with all of us together we can find incredible opportunities, develop a portfolio of warrants and equity in companies that we assume and hope for shareholders that will be worth a lot more than what we're investing the dollars into. So anyway Todd back to you. I appreciate the time to be able to tell kind of tell everyone where we are.

[Milton Todd Ault III:]

No, it's exciting what you're doing there. It gives you power [indiscernible] pretty impressed. As you know we run a holding company and I keep reiterating the company's operate our Marone with Darren almost and Billy running their own shows, I'm involved with them and try to help them provide capital and growth but we really believe that the some of the parts will add a lot of value to the total value of the business and Billy's out there making loans and building the balance sheet we're pretty excited about that. One thing that has happened with Billy too is there has been so many people that he knows in the space we have a lot of -- as Billy talks about deal flow a company has been able to look at recent deals on the side whether we wanted to participate and potentially buy other businesses that met some of our existing verticals. Billy, I think we should answer one of the main questions I've been getting and I understand that you've some news today so why don't we talk a little bit about what happened with IM today and you can maybe let the market know what happened with the IM transaction. So Billy let me set the stage you lent them 1.6 million initially for them to buy and build out the fourth restaurant that hospitality business is humming now. We think it's going to do somewhere about $10 million over the next year they've been in business for four or five years they're doing really well, that's going to be integrated into our financials in the next quarter and add to our top line. Why don’t you just talk about what you're doing with David Krause and his team there, Debbie Krause and what's going on with PrepKitchen.

[Bill Corbett:]

Yes. Thanks, Todd. So I know it kind of comes as a shock but we've closed the transaction to acquire IM and in doing so pick up an incredibly talented management team, have a long history in this space including Cheesecake Factory. The restaurants are doing extremely well. We do believe they'll be profitable immediately. They were last quarter although the numbers that we've seen for the last several years they were profitable so we're very excited. We will own 51% which allows us to consolidate and they will have to obviously out of cash flow they will be paying back the loan and once the loans paid back they were on 49%. So right now we own currently about 98.2%. They will own over the next probably out of cash flow over the next year and a half they're 49% and they are great partners and we're very supportive of what they're doing and already on a path to acquire and build out more restaurant. So it's great for us. It's great for them.

[Milton Todd Ault III:]

I've spent a lot of time with their team David and his wife never Deborah Krause. I believe they were and I hope I don't get this wrong she was really instrumental in building out Pure Nightclub in Vegas they did an incredible job when she left Cheesecake Factory and he's really an expert marketer. I've talked to them about their plans for PrepKitchen. I think they plan to open 35 in Southern California up and down the coast and that's a big number but there are already four locations in the first I think quarter in terms of what they have St. Marcos, Little Italy, I apologize they have a [indiscernible] so there is four locations, I think they will have a fifth location in Los Angeles. I think that may have been as early as today so they're really ramping and that's a really important business for us to be part of as they are kind of proven operators, they are really, we really are excited to work with them they're really dedicated to what they do and have a proven successful track record and the uniqueness of this transaction which is what I want to talk about is that Billy lent them 1.6 million, they had to pay us back in order to earn their equity and that's the kind of partners we want because they should listen, give us a loan we're going to go out there and prove this model. We're going to pay that back, we're going to earn our equity back on the loan and so we get to go out there and be partners with someone where they really run all the day to day operations. We truly run as a holding company. They report to us quarterly, they got a great accounting system and this is really something -- for those of us who have not invested with me before it's important to know that I made money on [indiscernible], I've made money on the [indiscernible] private equity and I really like the hospitality space as we've joked about before and you have mentioned but I don't seem to miss a meal although recently, we'll see about. Just having a little fun. We have a made a lot of money in the past in the hospitality space. We think that they're great operators and these are the kind of people that we want to be part of and with so we're pretty excited to be part of them. Billy thanks for staying the time here. I'm going to move on the next subject. Any of you have any questions, or any questions for Digital Power Lending or if any of you have a business that needs a loan, send us an email and maybe we will lend you some money because we're pretty excited about that business. MTIX, I'm going to finish on MTIX and we will go to new questions. Okay? So this contract is starting to pay off and if it wasn't for lawyers I'd give you more guidance but I'm not going to. We expect this to be 6.4 million to 8 million of revenues for Coolisys this year. That contract continues to ramp, I've tweeted out a couple things about what they're doing in Europe, this is truly our biggest outside investment. We truly believe this company will dominate it's space. It's the only one of its kind and we completely believe this business will ramp. We believe that the avalanche financials will be current in the next month and a half or two months I know they're behind and once they are current we will seek to uplift the company to the Nasdaq making DPW one of the biggest beneficial owners of the company. We think adds a value to our balance sheet, remember every dollar that this goes up in price puts about an additional I think around $12 million on our balance sheet along with our ownership of the company at Coolisys as a contract to be the general manufacturer to build these with [indiscernible] and the other subcontractor. So this just is something where we are completed excited about, we've said, and continue to say it we've bought more as you notice we have increased our position and we're very clear with them. We're happy with the management team. We're happy to be an owner. We do not consolidate their financials. We have lent them the money and we do have the convertible which we can convert it to our option or be paid back but we do own a large portion of the common stock in the open market I think a little bit more than 10% and we're very pleased with this, this purchase order will hopefully lead to additional purchase orders as we deliver machines. I expect the number to be much higher for 2019 than the $8 million we are looking at for 2018 eighteen. Let's continue on. New acquisitions, we are always looking at places that businesses that we can put into our existing portfolio to help out especially in hospitality, crypto mining etcetera. The one thing I would say that I get a lot of questions on is about dilution, capital raises etcetera. This will start to wane a little bit. We won't need as much capital for example just one example of not needing as much capital for operations. As Darren's team is producing $400,000 worth of crypto a month. So if Darren choose to he can buy the new miners from Bitmain that we are buying directly selling in cryptocurrency and with those prices being down his average price to get to 10,000 is less plus we're building our own miners that cost even lower we think internally over time but the fact that he's generating 400,000 a month is a big offset to the prior burn that he had when we made those purchases of those machines. So as the companies like Enertec come on board they have these long tail contracts. They start to deliver on their promise value. You will start to see the cash flow increase and the needs for us to go to market will be reduced clearly everyone saw we just recently did a big deal to buy in Enertec and to do some shuffling around. When we acquire in the future and one of the things that Will Horne will be thrilled about is our CFO -- will be pulling his hair out about this. Our capital cost will come down as we have scaled past 60 million in assets will bring down our borrowing costs and will go to a single sourced lenders to where we can borrow $5 million, $10 million, $20 million at a time to make acquisitions that are more synergistic etcetera. It should be easier on the balance sheet going forward as our cost of capital goes down but as of present we will start to see as moderate as we integrate the existing acquisitions we have. We work hard to make them profitable and to work them forward into 2019 as you know it gives the guidance going into 2019 and we expect generate free cash flow and this is something which is really important to us as we go forward. I've already talked about the initiatives so I'm not going to really cover this any further. I am going to get to some questions let me answer some of those questions for what we're doing for this existing quarter. So the question from Lisa Thompson was, does the $68 million include Enertec? Yes it does. 10 million of the 68 million comes from Enertec. We have already covered her second question the status the IM acquisition. One of the main questions, is there any issue with maintaining the New York listing? We have present equity of over $21 million, the required equity is 6 million so we are well capitalized to maintain our listing and as that I know of New York stock exchanges do not have the same issue with the dollar as the Nasdaq does. We are in good standing as I know of as of today with the NYSE, I don't know why that rumour continues to persist it's nonsense. We have passed the one year mark since we satisfied our continuing listing application and we're very comfortable with our relationship with the New York Stock Exchange American. How much of have you raised with the ATM? We've raised 13 million off the ATM so far. What is the status of MTIX machines? They're being delivered and as we've said will deliver $8 million worth in 2018. So I don't know if there are any other questions. We appreciate everyone's time. We're really proud of where we are. I do wish, a part of me does wish that we could accelerate a little bit our reporting so people could see that revenue ramp but keep in mind as you get out there's a lot of information that I see on the web when I get questions asked that are really misleading. When you look at our asset base it's important to understand our future revenue and what will generate with future cash flow and so the story is intact for us we still plan on doing $44 million to $49 million for this year and if everyone does the math which I can't take you on you've to go on to your journey for that. You would be able to figure out what we can do for the following year given our growth. We will give guidance for full year when we're comfortable some time when we report in August for 2019 we will provide some guidance at that time but the story for growth with Enertec, Coolisys, Super Crypto, Digital Power Lending, MTIX, our hospitality business and our real estate business and I stressed everybody there is real estate it's not substantial enough yet to go into it when you look at materiality I would encourage everyone to understand the materiality is a function of our total assets. We will disclose the real estate transactions when we believe they are material and with that I thank everyone from being a shareholder. Thank you, Darren. All the parties. I'm sorry, Will couldn’t be here, Will thank you very much for being on the call. Will as we hang up here do you have anything to add or anything you would like to say on the call before we hang up?

[Will Horne:]

No. I you did a fantastic job going over the different segments and operationally.

[Milton Todd Ault III:]

Well, Will we appreciate all your hard work. You've taken the company that has never had this kind of reporting and turned it into a holding company and you've taken a bunch of acquisitions and have put them together. I know there's a lot pending but you did an amazing job. We appreciate your hard work and the team you're building around the financials. I really said this everybody on the call and I said it a bunch of times there's no better CFO I think in the world than Will and hopefully we don't lose him. The deal I have with Will is if Microsoft offers him a job he can take it, then he doesn’t have to stay with us. So anyways Will we appreciate your time. Everybody have a good week and we'll talk to soon.