Duos Technologies Group, Inc.
Q3 2020 Earnings Call Transcript

Published: 13 Nov 2020

[Operator:]

Good afternoon. Welcome to Duos Technologies' Third Quarter 2020 Earnings Conference Call. Joining us for today's call are Duos CEO, Chuck Ferry and CFO, Adrian Goldfarb. Following their remarks, we will open the call for your questions. Then before we conclude today's call, I'll provide the necessary cautions regarding the forward-looking statements made by management during this call. Now, I'd like to turn the call over to Duos’ CEO, Chuck Ferry. Sir, please proceed.

[Chuck Ferry:]

Welcome everyone and thank you for joining us. Earlier today, we issued a press release announcing our financial results for the third quarter of 2020, as well as other operational highlights. A copy of the press release is available in the Investor Relations section of our website.

[Adrian Goldfarb:]

Thank you, Chuck. Before discussing the numbers in detail, I would like to make a few introductory comments. From a purely financial standpoint, this past quarter has been extremely challenging. After our successful uplisting to NASDAQ earlier in the year, we were almost immediately hit with the effects of the ongoing pandemic. This changed many of our original assumptions for the business operations for 2020. Fortunately, an assessment of the situation leads us to believe that although we were likely to suffer delays in receiving orders, and implementation schedules, we would likely be able to resume later this year. In addition, the pause gave us time to examine and consider certain aspects of the business that could be significantly improved. And I'm pleased to report that the management team has and will continue to focus on areas to strengthen overall operations and results -- improvement in financial results that can be expected. Chuck will discuss much of this later in the call. Now turning to our financial results for the third quarter. Total revenue for the third quarter decreased 42% to $1.28 million, compared to $2.2 million in the equivalent quarter in 2019. The decrease in total revenue for the quarter was due to a decline in technology systems revenue, as a result of an earlier delay in receiving an order for a large project. This was initially planned for execution during the third quarter of 2020, but will now be substantially completed in the fourth quarter. Total revenue for the nine months ended September 30, 2020, decreased 46% to $4.26 million from $7.9 million in the same period last year. The decrease in total revenue was driven by slower than anticipated contract awards by one customer, pending resolutions of certain terms and conditions, which has now been resolved. The current pandemic environment has also impacted expected receipt of awards and caused delays in execution due to travel and other restrictions.

[Chuck Ferry:]

Thanks, Adrian. For the remainder of my remarks today, I'd like to spend an extra amount of time discussing our strategic review, the results of that process and our operational roadmap going forward. Then I'll provide a brief update on our operation for the last quarter, including recent wins and management updates, before turning it over for questions. Beginning first with our strategic review. At a high level, I'm pleased to say that the many reasons that drew me to this company, including its people, technology and market opportunity still hold true after a detailed assessment. I also recognize there are a number of improvements that must be made to position our company for long-term success.

[Operator:]

[Chuck Ferry:]

Thanks operator. And thank you everyone for joining us on today's call.

[Operator:]

Before we conclude today's call, I would like to provide Duos' Safe Harbor statement that includes cautions -- important cautions regarding forward-looking statements made during this call. This earnings call contains forward-looking statements within the meaning of Private Securities Litigation Reform Act of 1995. Forward-looking terminology such as believes, expects, may, will, should, anticipates, plans, and their opposites or similar expressions are intended to identify forward-looking statements. We caution you that these statements are not guarantees of future performance or events and are subject to a number of uncertainties, risks and other influences, many of which are beyond our control, which may influence the accuracy of the statements and the projections upon, which the statements are based and could cause Duos Technologies Group Incorporated actual results to differ materially from those anticipated by the forward-looking statements. These risks and uncertainties include, but are not limited to those described in Item 1A in Duos Annual Report on Form 10-K, which is expressly incorporated herein by reference. And other factors as may periodically be described in Duos filings with the SEC. Thank you for joining us today for Duos Technology Group's 2020 third quarter earnings conference call. You may now disconnect.