Insignia Systems, Inc.
Q3 2015 Earnings Call Transcript

Published: 28 Oct 2015

[Operator:]

Greetings, and welcome to the Insignia Systems' Third Quarter Results Conference Call. Just a reminder, today's conference is being recorded. Except for the historical information mentioned, the matters discussed in this conference call are forward-looking statements. The company's actual results could differ materially from these forward-looking statements as a result of a number of factors, including risks and uncertainties as described in the company's Form 10-K for the year ended December 31, 2012, I’m sorry, 2014 and other recent filings with the Securities and Exchange Commission. The company wishes to caution listeners not to place undue reliance upon any such forward-looking statements, which speaks only as of the date made. At this time, I would like to turn the conference over to Mr. John Gonsior, President and Chief Financial Officer. Please go ahead.

[John Gonsior:]

Hi, thank you. Good afternoon everybody and thank you for participating in today's call to discuss our third quarter. With me today is Tim Halfmann, our Chief Sales & Marketing Officer. First, off let’s review the numbers. As we stated in our release from earlier today, we have continued to see year-over-year growth in our core business. Q3 versus Q3 was pretty consistent across the board, although profitability in the 2015 period was better than last year. On a year-to-date perspective, revenue is up about 2.5% overall with increases in both service, revenues and legacy product revenues. Gross margin dollars have also increased on a slightly reduced margin percentage which is due to both customer mix and pricing strategies that we’ve employed this year. Operating expenses are down over 4% from last year, as we’re continuing to focus on spending where we believe we’re getting the best returns that we can. Operating income is also increased nicely year-over-year and we’re produced EPS of $0.07 a share versus $0.05 a share last year. Additionally, during the third quarter, we repurchased 577,000 shares at an average price of $2.59. Finally, we’re pleased that we have $6.8 million of POPS bookings to run in the fourth quarter, which is up nicely when compared to last year’s bookings number $5.2 million. Next, I want to address a couple of key areas for our company. The first is obviously our core products. We’re pleased with the results, that we’ve seen this year and our ability to continue to produce returns on these core offerings. Over the past few months, we’ve placed greater emphasis on analyzing our core business with the purpose of identifying our true strength in opportunities. That focused analysis has allowed us to be creative in how we connect with new customers, retailers and do things like POPS day which drove incremental revenue for us this quarter. Secondly, as I mentioned on our last conference call, we have a continued focus on expanding our product portfolio and having us focus the part of our DNA now and in the future. For several years, we have relied primarily on a single product, as our source of revenue and during that time have seen inconsistent revenue and profitability. We had a time when both CPGs and retailers are looking for new ways to reach and engage with consumers. And we’re using that hunger for new ideas to guide our efforts as we’ve looked to add additional products to our set of offerings. We’ve seen the momentum for the Like Machine build in the past couple of months and during this [indiscernible], we’ve had many learnings that I believe will benefit us in our future efforts to add new products. I believe it’s important though as we’ve looked to move down the path of product expansion, that those products both support current offering as well as allow expansion to new retailers channels and customers. With that, I’ll open it up for questions.