Agilysys, Inc. (AGYS) on Q4 2021 Results - Earnings Call Transcript
Operator: Good day, ladies and gentlemen, and welcome to Agilysys Fiscal 2021 Fourth Quarter and Year-End Conference Call. As a reminder, today's conference may be recorded. I would now like to turn the conference over to Jessica Hennessy, Senior Manager of Corporate Strategy and Investor Relations at Agilysys. You may begin.
Jessica Hennessy: Thank you, Sara, and good afternoon, everybody. Thank you for joining the Agilysys fiscal 2021 fourth quarter and year-end conference call. We will get started in just a minute with management's comments, but before doing so, let me read the safe harbor language. Some statements made on today's call will be predictive and are intended to be made as forward-looking within the safe harbor protections of the Private Securities Litigation Reform Act of 1995, including statements regarding our financial guidance for fiscal 2022. Although the company believes that its forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause results to differ materially.
Ramesh Srinivasan: Thank you, Jessica. Good evening, everyone. Welcome to our fiscal 2021 fourth quarter and year-end earnings call. Joining Jessica and me on the call today is Dave Wood, our CFO. Finally, we've been able to return to our pre-pandemic routine and conduct this call together from our Atlanta Office. We hope all of you and your families are doing well and staying safe and healthy. We would like to dedicate this call to our talented, courageous, committed and determined global teams located in the U.S., UK, Asia and in the India Development Center, who have helped us navigate through an extraordinary fiscal 2021 a lot better than we were imagining last April. Among other things, all of them have helped us keep our focus on product innovation, and world-class customer service, fighting through all the tough circumstances. While the U.S. and UK seems well on their way back to normalcy. Many countries in Asia continue to be seriously challenged by the virus, especially India. The last couple of months have been particularly difficult for our 950 India Development Center personnel. Several of them have lost family members and have faced extremely difficult family situations. About 30 of them are themselves currently recovering after testing COVID positive. Through all of this, they have worked incredibly hard to keep our pace of product innovation moving forward. Working together with our experienced, talented and hardworking, U.S. based R&D personnel. The productivity and quality of execution levels of our worldwide workforce has been inspirational for all of us. We continue to treat the good health, happiness and well-being of all our Agilysys teammates, and customer and partner personnel as our top priority. While most of our employees still remain in a work from home mode, which has worked well for us during the past 14 months. We are beginning to slowly trickle back to working from our various office locations, as a number of fully vaccinated personnel continues to increase. January and the first three weeks of February presented continuing difficult challenges and uncertainties for the hospitality industry, resulting in a slight miss of our original revenue expectations for the quarter.
Dave Wood: Thank you, Ramesh. Taking a look at our financial results, beginning with the income statement. Fourth quarter fiscal 2021 revenue was $36.3 million and 8.4% decrease from total net revenue of $39.7 million in the comparable prior year period. The expected decrease in top-line revenue largely reflects a 21.8% product revenue decline and a 23.7% decrease in professional services revenue offset by a 2.8% increase in recurring revenue. On an annual basis we saw a slowdown in projects with large upfront capital expenditures, resulting in lower product and professional services revenue. Product revenue declined $17.5 million or 39.6% while professional services revenue declined $11 million or 33.3%. Products and professional services revenue finished the year a combined 44% higher in Q4 fiscal 2021 compared to Q1 fiscal 2021. While Q4 revenue was still impacted by the pandemic, we are pleased with the continuing signs of recovery exiting the fiscal fourth quarter. Throughout the year, total sales continued in the 60% to 70% range of fiscal 2020 sales with subscription sales at record levels. We currently have a backlog of hardware, software and services that continue to remain at healthy levels to achieve our fiscal year 2022 plan. The improved sales activities we have seen during Q1 of fiscal 2022 should continue to grow that backlog and help return our professional services and product revenue to normal solid levels. We are pleased to see growth on an annual basis and recurring revenue. Recurring revenue during fiscal 2021 was $4.9 million higher than fiscal year 2020. Recurring revenue despite the headwinds created early in the year by the pandemic, and various one time credits given to customers to do our best toward helping them get through these challenging times. Total recurring revenue represented 63.1% of total net revenues for the fiscal fourth quarter, and 64.6% for the full year compared to 56.2% and 52.1% of total net revenue in the fourth quarter, and full year fiscal 2020 respectively. We are pleased with our continued subscription revenue growth, which grew at 11.6% for the fourth quarter of fiscal 2021 and 15.5% for the full fiscal year despite the tough industry circumstances. Subscription revenue comprised around 42% of total recurring revenue, compared to 39% of total recurring revenue in the fourth quarter of fiscal 2020. The highlight of the year was our continued annual subscription revenue growth of 15%, compared to fiscal 2020. I would add with add-on software modules growing at 325% compared to the prior fiscal year. Add-on software modules in fiscal year 2021 comprised 5% of total subscription revenue, compared to 1% in the prior fiscal year. Moving down to the income statement. Gross profit was $23.5 million compared to $19.7 million in the fourth quarter of fiscal 2020. Gross profit margin increased to 64.6% compared to 49.6% in the fourth quarter of fiscal 2020. Gross profit margin increased in Q4 FY2020 was 57.5%, if you remove the impact of capitalized software amortization that concluded at the end of fiscal year 2020. The gross profit margin increase was primarily due to the increase in higher margin recurring revenue and the reduction in product and professional services revenue compared to the prior year. Moving down to operating expenses. For fiscal Q4, we had a onetime vesting event related to stock-based compensation. Quarterly stock-based compensation was $28.7 million higher than Q4 fiscal 2020, as we pulled forward several quarters of expense in the fiscal fourth quarter of 2021. Stock-based compensation will return to more customary levels and remain in the 8% to 12% of revenue range for fiscal year 2022. Looking at operating expenses, excluding charges for legal settlements, impairment and severance and other charges, the fourth quarter saw an increase in operating expense to $48.3 million compared to $22.7 million in the prior year period, this increase in operating expense is mainly due to the stock-based compensation vesting mentioned about. Removing the increase in stock-based compensation, operating expense would have decreased by $3.1 million, compared to Q4 of fiscal 2020. Combined the three main operating line items, product development, sales and marketing and general and administrative expenses, excluding stock-based compensations were 46% of revenue this year, which was the lowest in the past five years. This continues to be a good reflection of the steady progress we are making with our operating leverage. Our operating loss for the fourth quarter of $24.8 million, net loss of $24.7 million and loss per diluted share of $1.05, all compared favorably to the prior year fourth quarter losses of $26.9 million, $27 million and $1.16, respectively. Adjusted net income normalizing for certain non-cash and non-recurring charges of $5.2 million compares favorably to adjusted net income of $1.3 million in the prior year fourth quarter and adjusted diluted earnings per share of $0.21 compares favorably to $0.05. For the 2021 fourth quarter, adjusted EBITDA was $7.1 million, compared to $3.6 million in the year ago quarter. And for the full year fiscal 2021 adjusted EBITDA was $26.7 million compared to $13 million. The growth in adjusted EBITDA for the full fiscal year represents 105.4% growth. We are pleased with our profitability levels with adjusted EBITDA coming in at 19.4% of revenue for fiscal 2021. Moving down to the balance sheet and cash flow statement. Cash and marketable securities as of March 31 2021 was $99.2 million, compared to $46.7 million on March 31 2020. We are pleased with our ability to manage and improve our liquidity throughout the last 12 months as we move past these challenging times. For the year we collected 93% of the cash collected in the prior years, despite a reduction in revenue. We feel this speaks to the strength of our customer relationships and the quality and nature of the products we provide. As it relates to free cash flow, I am pleased to see an increase for both the quarter and full fiscal year. Free cash flow in the quarter was $12 million compared to $4.9 million in the prior year quarter, and $27 million for the full fiscal year compared to $7.2 million in the prior year, which is driving our cash balance increase. As we have mentioned on previous calls, and Ramesh mentioned earlier, we're going back to providing only annual guidance. For our fiscal year 2022, we expect revenue to be in the $160 million to $170 million range with adjusted EBITDA slightly above 15% of total revenue. In closing, we are pleased with our 2021 financial results and the proven financial stability to navigate through one of the most trying times for the hospitality industry. We are fortunate enough to have a good recurring revenue base built on a foundation of mission critical products. While revenue levels suffered in fiscal 2021 did the impact of the pandemic on our customers, our profitability levels allowed us to continue the product innovation necessary for the future of Agilysys. With that, I will now turn the call back over to Ramesh. Thank you.
Ramesh Srinivasan: Thank you, Dave. One quick personal note that possibly does not have a place in earnings call like this, but let me go ahead and say it anyway for the sake of greater clarity. As everyone already knows, I'm a big believer in the future of Agilysys and have been a buyer of our stock during past years. The original set of stock options granted to me when I joined Agilysys January calendar 2017 are set to expire at the end of June and I have no choice but to exercise those options and convert them to shares during the next few weeks. While processing that net transaction, a bunch of shares are going to be sold to pay for the taxes. When you pick that news up across various outlets, please do not interpret that as me selling Agilysys shares. It's just a standard practice and part of the options exercise which I have no choice, but to get done soon. Okay, back to our business. All things considered, we like our position now. We worked through an extremely difficult fiscal year and have good reasons to believe that we have come out of it much stronger. We are now better set for profitable growth than we have ever been. The hospitality industry is showing every sign of being in the early stages of a solid recovery and need the kind of technology and solutions we have painstakingly built over the past few years. We've started fiscal 2022 on a great note with increasing sales levels and are bullish about our short-term and long-term prospects. It does seem like a perfect positive storm is brewing, where a recovering industry eager to provide great service to guests who are demanding better and easier to use contactless technology. When such a recovering industry meets and starts to like a hospitality focused world-class technology provider like Agilysys, which has invested heavily during the past few years to create just that kind of guest centric cloud-native software solutions, the result of that is should be a big win-win for all concern. We cannot wait to see how the next few months and years unfold. With that, let me open up the call for Q&A. Sarah?
Operator: Thank you. Our first question comes on the line of Allen Klee with Maxim Group. Your line is now open.
Allen Klee: Good afternoon. I'm sorry to hear about the challenges of your employees in India. How do you feel about, what impact that that's going to have on productivity there and all your goals related to that?
Ramesh Srinivasan: Hi, Allen; thanks for the concern, appreciate it. So far it had only minimal impact, because everyone has been working from home anyway. A couple of product releases did get delayed by a couple of weeks. So for example, the Spa and Golf module, there were certain releases planned that had to be delayed by two, three weeks. But other than that, no major impact to our business or our progress with product innovation, Allen. And we are being very supportive, many of them – their family members have been affected badly and we as a company are helping them out as much as we can. So there are some slight impacts here and there, some product releases get delayed by a week or two, but nothing to be concerned about. We don't see our product innovation pace lifting up at all. So we should be progressing, as well as we have in the past year or two.
Allen Klee: That's good to hear. My other question is, I thought I heard you hear that the interest in your property management system solutions has been picking up. Could you just talk about that a little bit?
Ramesh Srinivasan: Yes, Allen. The interest in PMS has been picking up especially in the last say, four to six months or so. For example, the Stay PMS, our cloud-native property management system platforms, we have had more wins with that product in the last, say, four months or six months or so than the previous couple of years combined. So there is definitely been a significant pickup in PMS interest, we've also won a couple of crucial deals with our LMS, PMS product. And Visual One completely modernized, is about to be released end of July and there is a lot of interest in that product as well. And the number of RFPs that we are participating with our Stay PMS product has also increased. So there could be some good news coming on that during the next few months. So overall, yes, our core PMS product interest has definitely picked up. And they already built all the supporting modules like mobile check-in, checkout and service and all those – and the booking engine – the booking website – the direct channel booking website, all that were already built up over the last couple of years. So now we have reached a stage with our PMS product set Allen, where all we need is a shot to do a demo. And if a customer takes the trouble to look at our guest journey – the PMF guest journey, that they can use in their resort. We have a 70%, 80% chance of winning the deal, that's the level of confidence with which we are going into PMS, RFPs now, and our participation levels have increased during the last four to six months.
Allen Klee: That's great. Thank you so much.
Ramesh Srinivasan: Thanks, Allen.
Operator: Thank you. Our next question comes from a line of Matt VanVliet with BTIG. Your line is now open.
Matt VanVliet: Yes, thanks. Good afternoon. Thanks for taking my question. I guess first you mentioned that the majority of maybe CapEx related projects especially those with a lot of product and/or services revenue have been sort of the most impacted or the slowest to come back. Dave, you also mentioned that you felt like those were going to come back to normalize level. So wanted to dig in a little bit there in terms of your level of confidence and sort of what that discussions with customers have been that would give you that confidence that they're going to want to return to something that as a product-based rather than moving to more of just the cloud-native products?
Ramesh Srinivasan: Yes. So – hi, Matt. So just to break-up that answer into a couple of pieces. Even when a customer chooses our cloud only cloud-native solutions Matt, it does involve services as well. So all our projects, whether they are on-prem projects or SaaS cloud-based project, it does involve services. So in terms of services revenue, coming back to normal levels is just a matter of an increase in the number of implementation projects. And that is bound to pick up, because it has to keep in line with the level of sales activity that is going on now. And customers are signing up for products and then finding themselves dealing with multiple priorities that they have to work through, and so, some of these projects are getting pushed back as far as implementation is concerned. So the first point, I would make is services revenue does not have anything to do with whether customer choose cloud, SaaS products, or on-prem products, both of those require our implementation services personal help, that is one. The product revenue part of it has not picked up as yet, because the hardware refresh portion of the product revenue has not picked up so far. So customers are buying software modules and the really needed software modules for now. And I think the hardware refresh kind of purchases will follow in a few months from now once everything picks up. The last point I will make Matt is in terms of coming back to a normalized state. The real pickup we have seen since about the end of February and has been week-after-week consistent throughout the last 12 weeks have mostly been in U.S. domestic gaming and resort sectors, which have really started doing well. APAC, EMEA, and managed food service providers, because employee cafeterias and all that have really not made a comeback as yet. Once those segments of the market also make a comeback, we should see even better sales progress than what we are doing now. So which is why we are very optimistic about the fiscal year as it goes along. It is bound to continue to improve, because currently it is mainly gaming and resorts pulling the wagon through once the APAC, EMEA, managed food service providers also make that kind of momentum increase, we should be in good shape throughout this fiscal year.
Matt VanVliet: Maybe a follow up on that. Just curious on how the new EMEA leadership is sort of building out the team there. What kind of progress they're making, I presume, is more from a pipeline standpoint at this point, given your commentary around that that region, but just curious what they've been able to do so far after joining sort of right at the beginning of the year?
Ramesh Srinivasan: Yes, good question, Matt. They are making excellent progress. They are really making excellent progress. We're very, very happy that they joined us. And also remember it is – EMEA is now managed by Don Demarinis, who also heads sales in the Americas as well. So Don is leading that team as well. And they are making excellent progress. In fact, in my list of major customer wins, you would have noticed, there were a couple of them from EMEA where Stay PMS was being sold for the first time there. So PMS is also making good progress in EMEA. And overall, we are very happy with how EMEA has progressed from the start of this calendar year.
Matt VanVliet: All right, great. Thank you for taking the questions.
Ramesh Srinivasan: Thank you, Matt.
Operator: Thank you. Our next question comes from the line of George Sutton with Craig-Hallum. Your line is now open.
George Sutton: Thank you very much. One of the statements you made on this call and also in your press release was that we currently go in every product sale discussion with a high degree of confidence. And Ramesh, I'm just curious if you can compare today in making that statement versus even a year ago. I'm not sure you'd make that statement unequivocally across your product platform, is that reasonable?
Ramesh Srinivasan: Yes. Now we can make that statement clearly across all our product platforms, George. No question about that. Now we are surprised if a customer looks at our product demo. And especially across the entire guest journey right, how they can manage their entire guest journey with a comprehensive set of products we have on the POS side, on the PMS side and now the inventory procurement products and data managing have also been modernized. We do go in with a good degree of confidence. And the recent win loss ratio that we measured, George, internally for the last four months, starting from December or so, when we look at the percentage of wins in the deals that we participate in, and we have closed either a win or a loss of big majority of them, we are winning now. So yes, George, we do go into sales demos and all that with a high degree of confidence. And the customer feedback also is extremely encouraging, because they are not seeing this kind of a modern technology based comprehensive set of products that serves the entire set of needs they have. They don't see this from others as well. So yes, and there are no comparison between 12 months from now, 12 months before and now, George, there's absolutely no comparison. Our confidence is much, much higher than what it was even 12 months ago.
George Sutton: So we were very impressed with the new PMS, LMS that you came out with in the last couple of months. I'm curious if you've started to do demos for some of the larger players in the market? Or when would you anticipate that to start?
Ramesh Srinivasan: A lot of the larger players in the market are also looking at Stay PMS now. LMS has a major presence mostly in the gaming sector. So most of the customers currently looking at the modernized LMS, PMS, I would say are current customers, who are planning to upgrade to that modernized version, and also take advantage of all the other add-on modules we have. A couple of bigger customers and corporations are currently looking at Stay PMS. And they are extremely impressed.
George Sutton: Super, thanks very much.
Ramesh Srinivasan: Thank you.
Operator: Thank you. Our last question comes from the line of the Nehal Chokshi with Northland Capital. Your line is now open.
Nehal Chokshi: All right, thank you. Solid results. You had some very encouraging set of metrics that you shared here, saying that now 85% of the best COVID period of the past five years. So, when you say now at 85%, you’re talking about the past 12 week period, meaning from February 23 and May 18. Is that correct?
Ramesh Srinivasan: Yes, so I’m sorry Nehal, I confused you a little bit. Not you, confused everyone a little bit with that stat. So basically, we have seen a major pick up since the last week of February, up to this past weekend. So that’s a set of 12 weeks. So, what we did was we added up our global sales that we measured an annual contract ACV terms, we added up our global sales. That number we had that total number of these past 12 weeks. And we compared that with the best 12 weeks stretch, which we’ve had in the last five years. So in the last five years, we went and analyze the numbers and looked at what is the best 12 weeks stretch we ever had in sales. And this current 12 weeks was about close to 85% of that peak 12-week number.
Nehal Chokshi: Yes, one was that that’s 12 week period over the past five years?
Ramesh Srinivasan: We did – Dave, did we note that tem, somewhere in 2018.
Dave Wood: Yes, was 2017.
Ramesh Srinivasan: So it was – we can when we talk to you later Nehal we’ll share with you the exact time period, but it was somewhere in that range of about three years ago or so.
Nehal Chokshi: Okay. So you also made another statement here during a conference call that I think sales were at 75% of comparable fiscal 4Q 2020 levels. I believe you were talking about sales or ACV bookings in this most recent March quarter, is that 75% of comparable fiscal for 4Q 2020, is that correct?
Dave Wood: Yes, that’s correct. So for the year, we were in the – we were about 65%, 67%. And for Q4, we had an uptick to around 75% of previous year bookings levels. But that was on the sales bookings, not the revenue side.
Nehal Chokshi: Yep. Understood. So the fiscal 4Q 2020 levels, how does that compare to that best 12 week period that you’re referencing that now 85% of?
Ramesh Srinivasan: So this 85% was compared to the best 12 week period we’ve ever had. And that was sometime in the 2017, 2018 timeframe. Right. So, we just wanted to express to you Nehal, that this last 12 weeks have gone well for us, so we are noticing a big uptick in gaming and resort space in the U.S. domestic market and we just compared to the best peak period we ever had. We didn’t compare it to every other 12 week period we’ve had, Nehal.
Nehal Chokshi: Yes, yes. But I guess what I’m trying to get at here is that it sounds like that the ACV bookings that you’ve been experiencing over the past 12 weeks is at least 20%, maybe 30% or 40% better than what you saw for the March quarter? Is that a correct interpretation here?
Ramesh Srinivasan: Yes, I mean, it is tough to compare – these 12-weeks falls across both Q4 and this current Q1. Right. So it is tough to make that comparison, because part of these 12 weeks did fall in Q4 as well. So, let’s not complicate it further by comparing it with that, right. So this 12 week what – one about five-weeks was about five weeks of that was in Q4 the remaining seven weeks of that or six weeks of that was in Q1. So it kind of silo straddled across both those quarters. But I will tell you that the current pace of sales is a definite pickup, right over what we have had in the last 2012 to 2014.
Nehal Chokshi: Okay, very good. And then Dave characterize that overall backlog was healthy. Does this mean that overall backlog has increased QoQ? Or is it are – you now able to implement faster than what you’re booking at this point in time?
Dave Wood: No, we’re still seeing an increase in the backlog, especially in professional services in our subscription backlog, waiting for products to go live. The hardware, the product backlog has leveled off of it is still definitely a healthy level. But as more customers are choosing subscription, that backlog is increasing faster than the product backlog. But all three are very, very healthy levels.
Nehal Chokshi: Okay, great. And then let’s move to the full year guidance here 16% to 24% year-over-year growth. Is it fair to say that the level of outperformance that you’ve been seeing for subscription relative to overall revenue will continue? At about the – I think around 2000 basis point premium relative to overall revenue?
Dave Wood: Yes, we expect that subscription revenue to continue to grow in the in the 20% range.
Nehal Chokshi: Okay, so not necessarily faster than overall revenue, then?
Dave Wood: Well, for fiscal 2022, it’ll be a little bit faster, because keep in mind, there was the one time credits that created a little bit of a drag on the subscription revenue.
Nehal Chokshi: Gotcha. Okay. Okay. And then there was another statement during the prepared remarks that said that expect momentum to increase through the year, does that mean year-over-year growth will continue to increase through the year or do you just simply mean that QoQ revenue trajectory will continue to improve? And are you talking about revenue? Are you talking about a sales or what I would call ACV bookings?
Ramesh Srinivasan: Yes, so that statement is more about revenue, though it is related to sales as well, because sales is, what drives at least a portion of the revenue? So, what we meant to say was, when you take our guidance of $160 million to $170 million, Nehal, we expect a higher proportion of that to happen in the second part of the year than in the first part of the year, so that we have given an annual guidance, but we expect it to be sequentially increasing revenue quarters as we go along. We expect second half to be better than the first half. And that was a statement about the revenue statement that we made. Now, that is going to be driven by the fact that we expect sales bookings to continue to increase throughout the year.
Nehal Chokshi: Got it. Okay. And then the free cash flow exceptionally strong this quarter. Does that take from free cash flow generation capability for fiscal year 2022?
Dave Wood: No, it does. I mean, the way we’ve always talked about free cash flow is, there’s some seasonality with billings and contract liabilities. But if you look over a 12 month period, it’s a pretty – it’s usually pretty close to our adjusted EBITDA levels. So, what you’re seeing is, you’ll see the same cycle next year where in the first half of the year we have bonus payments in the second half of the year, you’ll see more billings with our annual recurring revenue. So, it’s not taking from the next fiscal 2022, it just kind of averages out over a 12 month period.
Nehal Chokshi: Okay, great. Then my final question is that last quarter, you talked about, you’re starting to look at some acquisitions. Presumably that would be to, potentially enter some adjacent markets, but what’s your ability to enter adjacent markets without acquisitions, and what are the adjacent markets you would look at?
Ramesh Srinivasan: Yes, so Nehal in terms of adjacent, the two ways, adjacent products as well, there are certain adjacent products that we can look at through acquisitions. And we know the remaining conservative, and we are listening to opportunities as they come along. And we are taking a look at them. And, we will make the right decision when we come to it. In terms of your question about going to adjacent markets, we do have the ability to get there even without acquisitions in calendar 2022. Because when you think about our 1000 strong R&D resource strength now, we are now completing all the modernization projects, and virtually all of them should get done by the September, October timeframe, many of them are already done. So when we say that what we mean is all the R&D resources who were focused on modernization, meaning re-engineering current products are all going to be freed up to now carry the products forward. And also, these modern products are a lot easier to enhance and change than our old products were. So towards the end of this calendar year, it is almost like we are adding to our R&D strength without adding any resources, because they now get freed up to actually carry the ball forward. So we expect to be able to enter adjacent markets starting calendar 2022 without doing any acquisitions, but if a good acquisition comes along that we feel will be accretive quickly. And we’ll add to the shareholder value we are creating now. Absolutely, we will look at that as well. But starting calendar 2022, we have the ability to enter adjacent markets without needing acquisitions to do that.
Nehal Chokshi: Just quickly, how do you define accretive?
Ramesh Srinivasan: Accretive is that our EBITDA levels will go up within a short period of time.
Nehal Chokshi: Okay. Very good.
Ramesh Srinivasan: Even after the…
Nehal Chokshi: Thank you.
Ramesh Srinivasan: Maybe 12 months to 18 months period of time.
Nehal Chokshi: Right. Okay. Thank you.
Ramesh Srinivasan: Meaning acquisitions with sufficient cost synergies and good revenue synergies, that’s what we mean.
Nehal Chokshi: Okay, understood. Very good. Thank you. That’s it for me, which was a lot of questions. Sorry about that.
Ramesh Srinivasan: No worries, Nehal. Anytime. Thank you.
Operator: Thank you. There are no further questions. I will now turn the call back over to Ramesh for closing remarks.
Ramesh Srinivasan: Thank you, Sara. Thank you for all your continued interest in Agilysys and all your support and guidance. On behalf of our board management team and close to 1,400 team members. I’m very grateful for your attendance today and your continued investments in Agilysys. We look forward to talking to you again in a couple of months from now, when we will be reporting on our Q1 fiscal 2022 results. Till then, please take great care of yourself and everyone around you. Thank you.
Operator: Ladies and gentlemen, this concludes today’s conference call. Thank you for your participation. You may now disconnect.
