Sylogist Ltd Q2 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Amr Ezzat - Ventum Capital Markets - Analyst : Bill, Sujeet, congrats on a strong quarter. If we could start with the bookings, you're going from record to record. Can you speak to the strong pace during the quarter? How much of it was displacement versus growing wallet share within existing clients?

Question: Amr Ezzat - Ventum Capital Markets - Analyst : Fantastic. Then just back on the Ed side, that 25% number you gave, is that 25% of the growth or 25% of the total dollar bookings? I missed that.

Question: Amr Ezzat - Ventum Capital Markets - Analyst : Okay. And are we -- is that like specific to North Carolina? Are there other states that we should be thinking about? Any color you can give us there?

Question: Amr Ezzat - Ventum Capital Markets - Analyst : Fantastic. Then the execution, I guess, of these new bookings are a summer of 2024 event, correct?

Question: Amr Ezzat - Ventum Capital Markets - Analyst : Sorry, I meant, these new bookings you guys are executing on these projects currently in 2024? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 08, 2024 / 12:30PM, SYZ.TO - Q2 2024 Sylogist Ltd Earnings Call

Question: Amr Ezzat - Ventum Capital Markets - Analyst : Fantastic. Appreciate your comments on your channel strategy. Do you have channel partners working on implementations like independently yet? Or do you still have your PS professionals like mirroring them? I'm just trying to understand your pace, I guess, of handing off the implementations.

Question: Amr Ezzat - Ventum Capital Markets - Analyst : Then your PS professionals would all be focused, or mostly be focused on Ed, I guess, like going forward. Is that a fair statement?

Question: Amr Ezzat - Ventum Capital Markets - Analyst : Fantastic. Just one last one. Any updates you can share with us on SylogistPay?

Question: Amr Ezzat - Ventum Capital Markets - Analyst : Okay, I'll pass the line. Thank you. And congrats again.

Question: Gavin Fairweather - Cormark Securities Inc - Analyst : Good morning and congrats on the strong numbers. Maybe just to start out on, from a vertical perspective, Mission keeps putting up the numbers. Strong growth this quarter, 20%. Curious, when you look into the pipe and see what's going on in the competitor landscape and think about that cross sell opportunity, how confident are you that this level of performance can be maintained?

Question: Gavin Fairweather - Cormark Securities Inc - Analyst : I feel like we've been seeing that cross-sell between Navigator and Mission CRM has really been quite a strong growth engine for a number of years. How much runway do you have or how do you size up kind of the opportunity to execute on that integrated system going forward?

Question: Gavin Fairweather - Cormark Securities Inc - Analyst : Got it. And then just looking at the bookings overall this quarter, I mean, clearly you're seeing good returns on your increased spend. So I think you said 24 people in sales and marketing, and you've also kind of ramped up events and marketing spend as well. And I think you referenced kind of stepping on the gas. So what are you thinking from a go-to-market investment perspective? Where are the buckets where perhaps you could turn up the dial a little bit and keep the bookings momentum going? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 08, 2024 / 12:30PM, SYZ.TO - Q2 2024 Sylogist Ltd Earnings Call

Question: Gavin Fairweather - Cormark Securities Inc - Analyst : Got it. And then just lastly from me, I mean, now that you're seeing good momentum in all of your verticals and in the pipeline, like is M&A becoming a greater focus of the management team and curious what the dual landscape looks like there right now?

Question: Gavin Fairweather - Cormark Securities Inc - Analyst : I'll pass on the line. Thanks so much.

Question: Suthan Sukumar - Stifel Canada Inc - Analyst : Good morning, gents, and congrats on a strong quarter. For my first question I wanted to touch on some of the early encouraging progress you're seeing in Ed and government on back of the new product rollouts. Can you share some more color on some of the success proof points you were REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 08, 2024 / 12:30PM, SYZ.TO - Q2 2024 Sylogist Ltd Earnings Call seeing to date on the go-to-market front with these product rollouts verticals and what do you anticipate next steps to be to help drive sustained growth here?

Question: Suthan Sukumar - Stifel Canada Inc - Analyst : Great. That's helpful color. I also wanted to touch on some of that land and expand commentary that you discussed earlier, particularly in Mission. Can we expand on where you're seeing kind of the typical, or rather could you kind of help me understand what the typical land and expand motion is within mission? Is it just really the cross-sell of CRP -- CRM to ERP or vice versa? Or are there other product capabilities and functionality that really drive what the expansion motion could look like longer term?

Question: Suthan Sukumar - Stifel Canada Inc - Analyst : Yes. No, agree, that's good validation. How do you -- when you look -- when you look forward out over the kind of the medium to long term, and when you look at the mix of bookings from net new and expansions, how do you expect that mix to shift as you look out here? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 08, 2024 / 12:30PM, SYZ.TO - Q2 2024 Sylogist Ltd Earnings Call

Question: Suthan Sukumar - Stifel Canada Inc - Analyst : That's great. And then, Bill, maybe one last one for me, just on the competitive environment, it sounds like displacement momentum is sustaining. Curious to what you're seeing in the landscape. Is it still the same players that you're going up against or other new kind of solution providers coming into the mix as the market evolves here?

Question: Suthan Sukumar - Stifel Canada Inc - Analyst : Okay. Great. Maybe just one more for me, just on the outlook for continued investment here. What are your priorities here in terms of the investments that you are going to continue making on the OpEx front? And any change in view on sort of the capital being committed on the product and R&D side of things, just given some of the traction that you're seeing and opportunities that are emerging in the near term?

Question: Suthan Sukumar - Stifel Canada Inc - Analyst : Great. Thank you for the color. I'll pass the line.

Question: Daniel Rosenberg - Paradigm Capital - Analyst : Hi and good morning to Bill, Sujeet. And my first question was just around the customer. I was wondering if there's any -- if you just speak to the demand profile that you see out there from your end users, it's nice to see retention spending going up, but just trying to understand the dynamics on the front lines in terms of budgets, just trends in that areas from your end customers, please? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 08, 2024 / 12:30PM, SYZ.TO - Q2 2024 Sylogist Ltd Earnings Call

Question: Daniel Rosenberg - Paradigm Capital - Analyst : Okay. Just one quick financial question. So in the quarter, there were some working capital movements that kind of were unfavorable this quarter. Just can you help me understand what that looks like going forward just for modeling purposes, and how we should be thinking about working capital swings?

Question: Daniel Rosenberg - Paradigm Capital - Analyst : Okay, great. Appreciate that. And congrats on another solid quarter. I'll pass the line.