Sylogist Ltd. — Call Transcript 2024

Thank you for standing by. This is the conference operator. Welcome to the Sylogist Limited third quarter 2024 results conference call and webcast. As a reminder, all participants are in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star, then one, on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star, then zero. I would like now to turn the conference over to Jennifer Smith with LodeRock Advisors. Please go ahead. Thank you, Alan, and good morning. Joining me to discuss Sylogist Q3 fiscal 2024 results are Bill Wood, Sylogist President and Chief Executive Officer, and Sujeet Kini, Chief Financial Officer. This call is being recorded live at 8:30 A.M. Eastern Time on November 7th, 2024. Our Q3 press release and MD&A financial statements and accompanying notes have been issued and are available for download on SEDAR+. Please note that some of the statements made on the call may be forward-looking. Actual events or results may differ materially from those expressed or implied, and Sylogist disclaims any intent or obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise. The complete Safe Harbor statement is available in both our MD&A and press release, as well as on sylogist.com. We encourage our investors to read it in its entirety. We are reporting our financial results in accordance with International Financial Reporting Standards, or IFRS. Before, we will also discuss non-GAAP performance measures, which should be reviewed as supplemental. The MD&A contains definitions of each one used in our reporting. All of the dollar figures expressed on this call are in Canadian unless otherwise noted. I'll turn it over to Bill first with opening remarks, and Sujeet will review our Q3 financial performance, after which Bill will conclude scripted remarks, at which time we will open it up for questions. Bill? Thank you, Jen. Good morning and good afternoon to those of you joining us overseas. Building on the momentum we generated the first half of 2024, it was a strong Q3 for the business. Our results continue to validate the successful transition to a SaaS-driven enterprise, with growing recurring revenue, an effective and engaged partner network, and an expanding presence across our three strategic markets. In short, we're very pleased with the results we're seeing from the execution of our value creation strategy. I'd like to add some color to our Q3 performance. We saw 14% year-over-year bookings growth in the quarter. Especially encouraging was our success with customer upsells and cross-sells, that's largely attributable to happy customers using more of what our SaaS platforms now offer. I also want to highlight that nearly 40% of our bookings came from our SylogistEd sector. Reflecting the continued acceleration I've been signaling was on the horizon is now clearly occurring. The success we're seeing from our targeted competitor displacement strategy, the success of our SaaS offerings relative to the competitive landscape, and strong customer referrals drove our overall win rate even higher to above 70% in Q3. This impressive win rate is inclusive of both direct and partner-led sales motions. We're now seeing an increasingly balanced pipeline in bookings across all three strategic markets: SylogistMission, SylogistEd, and SylogistGov. At the end of Q3, our bookings pipeline is up 122% year-over-year. These leading indicators bode well for more balanced SaaS ARR growth across all three sectors as we look out to 2025 and beyond. One of the pillars of our value creation strategy is a carefully selected, aligned, and enabled partner network to allow us to scale profitably and capture market opportunity quickly. It's been just over a year since we turned earnest attention to building a strong partner community, and we're well ahead of plan in terms of the results we're seeing. As of Q3, partner-attached bookings have grown more than 700% year-over-year and grew 52% quarter-over-quarter. Partner-attached bookings represented almost 50% of our total bookings this quarter, compared to just 7% in Q3 of 2023. In our SylogistMission and SylogistGov sectors, so net of SylogistEd where we don't yet engage partners, partner-attached bookings came in at 77% of total bookings. Again, a very strong result for a KPI that bodes well for future value creation. To help ensure project implementation success, we continue to maintain our expert internal team to both empower the expanding partner community as well as deliver SylogistMission, SylogistGov, and SylogistEd project services to customers directly. As our community of high-quality partners becomes more self-sufficient, we see increasing leverage in sales and, even more importantly, broader implementation capacity in the back half of 2025 and beyond. As we execute our channel strategy, one of the outcomes is the accelerating handoff of our direct-to-customer project service revenue. This effectively inhibits our top-line revenue growth in the near term as we settle to a new top-line revenue mix that's increasingly comprised of more lucrative SaaS ARR. As I've said previously, this is an exciting, purposeful shift, and we're very pleased it's happening at a faster-than-expected clip as it validates that our partner strategy is working. To that end, strong execution continues to drive robust growth in our higher-margin ILTB SaaS ARR, as well as our SaaS NRR. Our SaaS ARR increased by 13% year-over-year to just shy of CAD 30 million, and SaaS NRR came in at a healthy 107%. I'll pause here and let Sujeet take you through our financial performance for the quarter in a little more detail. Sujeet? Thank you, Bill. Good morning, good afternoon, everybody. Before we get into the numbers, I wanted to remind everyone that in Q2 2024, we completed the divestiture of our Managed IT Services division. In order to facilitate an apples-to-apples comparison of key financial and operating metrics, all comparisons to prior periods have been adjusted to reflect the sale of this division. Additionally, within our Q3 2024 MD&A, we have included, for your reference, a four-quarter table that quantifies the revenue and Adjusted EBITDA impacts of the Managed IT Services division. As Bill mentioned, our Q3 results demonstrate the meaningful transformation of Sylogist into a SaaS enterprise while staying focused on profitable growth. Total revenue for the quarter was CAD 16.6 million, led by 15% growth in our SaaS subscription revenues. This growth was partially offset by an anticipated decrease in project services revenue related to our strategic shift to a partner-led delivery model. Overall revenue growth continues to be driven primarily by our SylogistMission segment that grew at 15% year-over-year, closely followed by our SylogistEd segment that grew by 10% year-over-year. Q3's overall comparative year-over-year revenue growth was additionally impacted by significant levels of non-core hardware sales that happened in Q3 2023. I want to remind everyone that we had a large hardware booking within our Sylogist Solutions business segment in Q3 2023, and this was in the amount of CAD 545,000. So absent the impact of this hardware sale in Q3 2023, year-over-year top-line revenue growth would have been approximately in the 6% growth range. That is, year-over-year Q3 2024 versus Q3 2023. Our gross profit margin for Q3 2024 was relatively consistent, with recent quarters coming in at 60% for the current quarter. Total operating expenses for Q3 2024 were also relatively consistent at 34% of revenue, compared with 35% during the same period last year. G&A expenses decreased by CAD 0.6 million to CAD 2.7 million in Q3 2024, compared with the corresponding period last year, coming in at 16% of revenues compared to 19% of revenues in Q3 2023. This decrease in G&A is a result of various operational savings in the current quarter. Sales and marketing expenses for Q3 2024 were CAD 2 million, or 12% of revenue, compared to CAD 1.7 million, or 11% of revenue in the same period last year. This increase was due to anticipated strategic investments made in additional sales quota-carrying headcount and increased marketing programmatic spending, including the spend on our SylogistEd user conference. Our sales and marketing FTE headcount increased to 26 people at the end of Q3 2024, up from 22 people at the end of Q3 2023. Net R&D expenses for Q3 2024 were consistent at 6% of revenue for Q3 2024, compared to 5% of revenue for Q3 2023. Similarly, gross R&D expenses were consistent at 14% of revenue for both periods. Adjusted EBITDA for Q3 2024 was CAD 4.2 million, and our adjusted EBITDA margin came in as expected at 25.3% in the current quarter, compared to 27.2% in Q3 2023. At the end of Q3 2024, we had CAD 13 million in cash. This level of cash is in line with the seasonality of our operations and the renewal cycle of a material cohort of our SylogistEd customer community. On October 31, 2024, we renewed our corporate credit facility. The renewal now includes a revolver for CAD 50 million, that's CAD 50 million, with an additional CAD 75 million optional accordion feature. This is in comparison to the prior facility, which is essentially a revolver for a headline amount of CAD 125 million. The new credit facility is committed for a three-year term and is renewable annually thereafter. We purposefully constructed the renewal in this manner, as it saves us approximately CAD 200,000 in standby fees annually, while at the same time preserving access to the same borrowing range that we would have had under the prior facility. And finally, I would also like to point out that at the end of this quarter, we completed the three-year anniversary of the Mission CRM acquisition and its related earnout. Inclusive of the accruals for the third-year earnout, the total purchase consideration for this acquisition is approximately CAD 7.8 million. We're extremely pleased to say that the overall ARR for Mission CRM at the three-year point, or at the three-year mark, is CAD 1.9 million. This compared to CAD 140,000 when we acquired Mission CRM back in October 2021. All of this is a compounded annual growth of approximately 141%. And so this acquisition, we believe, has undoubtedly strengthened our Mission platform, and team. With that, I will hand it back to you, Bill. Thank you, Sujeet. With our three leading SaaS platforms now in market, our competitor displacement strategy gaining traction, and the successful shift to a partner-driven model, we're well positioned to deliver increasingly profitable growth that's scalable, repeatable, and aligned with long-term value creation. To the credit of our outstanding team and a customer-first mindset, our investments are yielding the desired results. We've laid the foundation for growing very sticky recurring revenue, expanding free cash flow, and enhanced margins that we expect to become even more evident in the back half of 2025. Make no mistake, we envision a day when Sylogist is a materially larger enterprise with operating leverage. Thank you for your continued confidence and support as we push Sylogist to new heights. With that, let's take some questions. We will now begin the question-and-answer session. To ask a question, you may press Star, then one on your touch-tone phone. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press Star, then two. We will pause momentarily to assemble our roster. Our first question comes from Amr Ezzat from Ventum Capital Markets. Please go ahead. Good morning, Bill and Sujeet. Just a few questions. The first one, can you update us on the pace of your targeted competitor displacement? I'm wondering how does it compare to the previous few quarters? Is it holding steady, or are you seeing it accelerate? Good morning, Amr. We're actually seeing it accelerate. We're expanding the aperture of who those targeted competitors are as our now all three platforms are in market. So we have crosshairs in the Ed, Gov, and Mission segment. Within the mission segment specifically, we're seeing good strength in that area, continuing strength and better efficiencies as we work through each and every one and light up new customers from a given competitor. So the momentum is building. We feel really good. It's sustainable for many quarters ahead. Fantastic. On your NRR for the quarter, and still just Ed's, we saw a slight dip in NRR quarter-over-quarter. I also expected to see a bigger sales number in education, especially with the strong bookings last quarter. The MD&A notes some anticipated attrition in the vertical that's impacted NRR. Can you maybe give us color on that? For sure. There were some legacy customers that deepened their cycle in terms of where they fit with our go-forward SylogistEd strategy. So I would consider that the kind of cycling of some strategic attrition that we had identified several customers within the legacy customer community that really weren't a good fit for the go-forward. And so because of the budgeting cycle, they kind of went off as a cohort in that Q3 timeframe. Nothing really should be derived from that as any kind of churn picking up or whatever. It was really more of a strategic churn in that than anything that gives us pause. Okay. Is that mostly done, or do you foresee more of that over the coming quarters? We see that mostly done. Well, there may be the odd here and there, but ultimately, we have a good sightline to that community. We've been engaged with them for several years now, and we have a very good handle on the go-forward. We think anything that would happen churn-wise would be minor as we think about the go-forward. Great. Then, I guess on your partner strategy, I wonder, can you share with us what kind of SaaS growth rates you'd anticipate as we enter 2025 with an increased implementation capacity, both internally and externally? You're sort of going SaaS in the mid-teens. Do you guys foresee 2025 to be materially higher in terms of SaaS growth with the new capacity? Sujeet? Yeah. Good morning, Amr. So from a 2025 perspective, one of the comments I'll make is obviously working. Pardon me, Sujeet? Is your line muted? My apologies. Excuse me. My apologies. Can everybody hear me now? Amr, can you hear me? Yes. Yes. Loud and clear. We missed all the good parts. Yeah. No, my apologies. I was speaking into a muted mic when Bill was trying to get my attention. So to answer your question, Amr, I would look at it in terms of maintaining SaaS growth rates at the current rates. Since your question is more specific to the partner channel, certainly we do see lots of traction happening there. But just from a pure modeling perspective, I would view it as maintaining our SaaS recurring revenue growth in kind of the current range. And part of that also is in connection with there is, if you will, a certain lag between the bookings and the revenue. And essentially, maintaining the growth rate at current levels allows for that limited lag, if you will. And that's kind of how we're thinking about it within our shop. And like I said, we're at the moment looking through our pipeline in terms of the impacts on 2025 and how that would translate out into bookings and bookings into revenue. But my answer really would be to continue to maintain it in the range that it is right now. Okay. I would have thought we'd see an inflection point given that you've got increased implementation capacity. At some point, we'd see SaaS grow from 15%-20-something% range. The answer is yes. I mean, there will be an inflection that will happen. I think the more nuanced or the more of the refinement to that is pinpointing exactly when that inflection will happen, and that's sort of where I think we need to think through the fact that there is a little bit of a lag between bookings and revenue, and the inflection point has a lag effect compared to the actual booking happening. Understood. So it's happening, but it's hard to pinpoint when. That's great. Then maybe one last one. Any updates on SylogistPay that you guys can share with us? Nothing in this quarter. We believe we'll have some updates in the coming periods, but nothing has materially changed from our belief that SylogistEd continues to be an integral part of our strategy as we monetize the transactions flowing through the platforms. And ultimately, as we see more of the mission gov, excuse me, SylogistGov activity and the transactions that flow through that platform within municipalities, we see strength there as well. But stay tuned. Okay. Great. Thanks for taking my questions. Thanks, Amr. Our next question comes from Gavin Fairweather of Cormark. Please go ahead. Oh, hey. Good morning. Thanks for taking my questions. Maybe just to start out, Bill, on the partner channel, can you refresh us on how many partners you're up to now? And I'm also curious kind of how mature that partner cohort is. Are they all kind of reaching the level of bookings and deal generation that you would expect, or are some of those still in the process of ramping? We haven't given a specific number, but it is approximately 2x from where we were this time last year. It's fulsome in terms of the coverage we're looking for at this point. I would say a solid third to a half of those are now getting their legs underneath them, and we're moving into the phase where they're not shadowing us, but we're shadowing them in terms of implementations while the newer partners are more in the former part of going through the certification and training. So it's very pleasing to see the inbound activity we're seeing from the partner community who are anxious to be able to carry our flag. They have identified us as a leader for the specific solutions that they're looking for for their customer cohorts that are looking to upgrade. So we think the go-forward is very exciting as that community continues to build out. But I would say about half of them are now flipping to the more partner-led versus in-house shadowing side, which is a great signal. Yeah. That's great to hear. That's great to hear. And then the KPIs you shared are super impressive in terms of the pipeline and the win rates that you're seeing. It strikes me as though you just need to see more deals. I mean, I'm curious what those metrics are telling you in terms of the need to invest in marketing and partner enablement and potentially a few more bodies in the direct sales force. We agree. As we now have the motions reflected, we're not just throwing money into the wind. We do believe as we look at enabling the partner community to be able to bring us into deals as well as us being able to activate deals ourselves, we see the ability to now get even more efficiency out of our marketing motions, and as well as our customer referrals are starting to become more meaningful as our pod of gov and ed customers expand. We were starting from relatively a very small base and ultimately wanted to make sure that would progress in a thoughtful way before we got out over our skis of more people knocking on the door that we could accommodate, but we're now through that gate, and we feel that there's so the scalability portion we feel very good about. And now that's really being supplemented by the idea of our pipeline is growing with more balance and really materially year-over-year. We feel good about what growth can occur in the coming quarters in terms of just the bookings. Appreciate the color. And then just on Gov, I know you've transitioned some customers onto the new SaaS platform, and partners are increasingly working with it on deals. Can you just provide a bit of color on the feedback that you're getting from that existing customer cohort that's moved over and the partners that are increasingly looking to sell it? And how is that kind of influencing your view on the growth prospects for that platform going forward? From the customer side, they're delighted. They were able to transition from a standpoint of core business functions and now empowered with a fully SaaS platform. The prospective customers, the RFPs that are out there, we see almost an open arm kind of welcome. Thank goodness you're here because there really has been a void of new technology for the segment that we're aimed at. So the RFP activity is very strong. The desire for the Microsoft-based platform is very strong. We're well-positioned, obviously, and uniquely positioned there. So we're quite bullish on the gov sector in terms of an accelerator for us as we think about the go-forward and as we expand the footprint not only east to west in Canada, but into North America overall. So partners will be a big part of that. That is 100% partner-driven. They have cohorts of Great Plains customers and so on that they've been looking for a solution to be able to fit the needs and budgets of customers that really hasn't existed for some time. We're very excited about the gov sector overall, and we think we're now in a very good position to accelerate in that space. Great. That's it for me. I'll pass along. Thanks so much. The next question comes from Suthan Sukumar of Stifel Canada. Please go ahead. Good morning, gents. Congrats on a solid print. For my first question, I wanted to just touch on your go-to-market success to date. It's really good to hear that competitive placements are sustaining well. But just kind of curious, how much of your go-to-market success to date has been driven from greenfield opportunities, meaning going after that segment of the market that has yet to adopt any meaningful technology? Good morning, Suthan. That segment, just greenfield, is quite small. The technology may be really dated, which is very common in the ed and gov, and frankly, a little less so on the mission sector. But most everyone is coming off of an existing system of some sort. As I said, it could be maybe in place for decades. The key, and I'll give you a sense of displacement and our displacement strategy, almost 75% of our bookings in this quarter were with targeted competitor displacements. So that really gives you a sense of, A, our focus, the efficiency that we're bringing to those motions, the activity that's going on within those cohort communities that now have visibility to us as a viable and exciting alternative. And so I would say that the motions around our targeted displacement shouldn't be taken as a small pond. It's a very, very large ocean of opportunity. We're just focused on those where we can win at a very high rate and have good efficiency to lead to happy customers. Great. Fantastic. My second question, Bill, is really around the education vertical. Can you talk a little bit about the strength that you're seeing there? I think following last quarter, I may have been maybe incorrectly anticipating a little bit of normalization in the pace of bookings growth and how that translates to revenue growth. But it looks like the strength is continuing. Can you talk about some of the factors for the success underlying the strength there? It is the validation of our lift and shift of the technology that we acquired in Oklahoma that was specific to Oklahoma and now successfully lifting and shifting that to North Carolina, lighting up customers, existing as well as new, on that platform, and then the permeation of that out to other school districts that have been looking for a solution and are unhappy with their existing. And that also has been our springboard as we think about 2025 and beyond into targeted other states. So it really is you got to earn your stripes in a new state, if you will. There's covenants related to what the idiosyncrasies are. But from a software standpoint now, we've taken all the hardwiring out that was specific to Oklahoma. And now, any state that we move forward, it was validated in North Carolina, we can handle the nuances of state idiosyncrasies without any change to the software itself. It's more setup-related, so it now gives us the ability to think about scale differently than we had thought of it before when we were first needing to validate that what we believed was true is now proving out to be so. Excellent. And on the government segment, it's good to hear you're quite bullish on the opportunity there and really the opportunity to expand across North America. Can you speak a little bit about the strategy to protect your existing base, I guess, from a migration standpoint? And just a reminder of what are the key levers here to drive organic growth in the government segment? The moat for protecting existing customers is largely there's few to no real viable alternatives, if you will, that meets the sophistication as well as the contemporary posture, security posture of the platform, such as SylogistGov. We're in a very good place now in terms of our ability to demonstrate to partners that we have not just a solution on the come, but something that now is working in cities and towns that they can spin up on and take to their cohorts of customers to say, "We have something that you really need to look at." We also have now created visibility through technology and AI where we can go out and across North America track all of the RFPs that are going on within the gov sector. And that gives us a real good sense of timing of what our pipeline should look like, where we're pointing, and where partners are already spending their efforts. So we are sharing that platform and that data with them so that we're making sure that we're aware of opportunities that are on the horizon and are in the queue to make sure that either we're part of that bidding process. But even more importantly, some of them and many of them, and it's increasing, we can get out to a sole source provider scenario so they don't go out to or aren't forced to go out to a bid procurement because we have unique technology, the Microsoft platform built on Business Central, that if their needs and desires are of that ilk, they can come in and look at us as a sole source provider. So that really shrinks the sales cycle as well. So we're all systems go on the gov side at this point, and our partners are really enthused. And they're actually adding people to better assess the data that's coming into them to be able to get their kind of attack mode of go-to-market using our platform ramped up. Okay. Great. That's good color. Last one for me, guys, is just on Microsoft. Can you provide a quick update on how this relationship is evolving and what was the level of contribution to bookings and pipeline this quarter? And what do you expect in the course ahead? I'll take kind of the business side of it. We feel really good about our commitment to the Business Central platform and the Dynamics 365 CRM platform. We get so many advantages vis-à-vis our competitors on the AI front, on the security posture front, on the cloud scalability front. And it's what our customers and what prospective customers are looking for. Microsoft is becoming almost a de facto kind of platform of choice or provider of choice within the segments that we serve in the public sector. So that's a great tailwind for us relative to Microsoft as a partner. We're also now having a couple of years of engagement and through Grant McLaren's efforts and his deep experience with Microsoft as managing it from KPMG to Microsoft previously. We really expanded how we work with one another and make sure that we are aligned in our marketing efforts and how they think about their go-to-market in terms of the public sector and really showcase us as a premier partner for that side. They're horizontally oriented, so they're very reliant on vertical partners like us to be able to deliver their technology, sell their SaaS subscriptions, but with the vertical additions that we add to their horizontal solutions. So we feel good about it, really good about it on the acceleration side and maintaining and containing our R&D spend going forward. Anything on the financial side you want to add there, Sujeet? No, Bill. And Suthan, good morning. I don't believe in, I don't recall us having talked about the financial impacts of the Microsoft relationship either on the booking side or on the cost side. But again, I will reiterate the huge, huge advantage of that relationship is obviously on the R&D side. And kind of on the business side, it's that ability to leverage off the relationship and more often than not actually get walked into deals because of the Microsoft relationship. But we don't share numbers-related details in terms of bookings attributed, if you will, to Microsoft or anything on those lines. Thank you, Sujeet. Thank you, gents. Great update. Thanks for taking my questions. I'll pass the line. Our next question comes from Daniel Rosenberg of Paradigm Capital. Please go ahead. Hi. Good morning, Bill and Sujeet. My first question was around the partner channel. And so I think you mentioned doubling the number of partners since last year, which is quite a positive to see. I was wondering, going forward, if you think bookings is it about going deeper with these partners, or do you plan on expanding again? That number was just, yeah, doubling is quite significant. So just curious about any details there. Good morning, Daniel. As I said earlier, we have a lot of inbound from Microsoft-certified Business Central and others that are well-known names across North America, firms with IT consulting, digital transformation, and specifically financial practices on the consulting side and implementation for the public sector. If they have a Microsoft orientation as a partner, and that's really our segment, and many of them have also moved to that platform for the reasons I said before, it's what people want. We do see that partner community expanding. We're not doing it at, "Hey, we're open for business. Anybody want to sign up?" It's not our mode because we really want to make sure their commitment to the effectiveness of the implementation and the long-term partnership is sincere. And so I don't mean to say that they're coming to us with false pretense, but the reality is we want to peel back and make sure that they have their sustainable partners. Partners coming in and out is a costly proposition for us as we think about the go-forward. There's a lot of them, Daniel, that are knocking on our door that we're in discussions with now, and we are in a good position to be able to kind of select which ones fit well for us. But also, we're very appreciative of the additive aspect of what they bring to our team, particularly visibility and girth. Many of them have really mature programs in the public sector and deep customer relationships that are really benefiting us as we start to win more deals and they put us on more deals. So it's very positive. We see it building as we go forward. And undoubtedly, I think they will go deeper with us. And I think we will also add partners in count without question. Okay. Thanks for that. I was also curious about the displacement that you spoke of. I was wondering, what is that balance between the local solution or smaller players versus some of the larger incumbents? Is that any of that displacement coming from the big guys today? And do you see that changing as you look to the future? I have to pause. Big guys is relative in terms of who that could fit. I will say that our displacement strategy is not kind of one that's focused on down market. We are very much focused on our ICP, and the displacement is very much associated with our ideal customer profile in each of the segments that we're working on, so no, we're not seeing any deal deflation in terms of our overall booking size whatsoever, and we're actually seeing some expansion there, so I would say in certain markets, we are very much displacing the big guy, if you will, or big guys, if you will. Others in the gov side, we're never going to be a replacement for some of the high-end SAP kind of solutions that really compete for those uber large cities. That's not our ideal customer profile. I wouldn't measure ourselves against the large deal. What we are seeing is really good, strong deal value continuing and growing as we think about not only the initial install, but the upsell and cross-sell as they use a platform more, bring on more users, and bring on more functionality. Okay. Thanks for that and then my last question is just around M&A. You mentioned the success of Mission, or you provided some data around the success that you've had. I was wondering how you guys are thinking about the M&A market today, any opportunities or challenges when you look at what's out there as it relates to Sylogist? Yeah. Our appetite has not changed. We continue to make sure that we're not adding burden to ourselves that doesn't make sense, a lift that doesn't make sense. There are continuing targets. We continue to have both direct outreach on an ongoing basis as well as through many partners that bring us possibilities as well. We have a strong appetite. We continue to look at a credit facility that allows us to execute on deals if they make sense. We haven't seen a lot of the deal values come down. Overall, we still feel that good assets are demanding or getting a lot of activity if they do come to market in a more public process. We continue to look at opportunities that may not be yet in a process and provide a compelling case as to why preemptively we would be a good buyer. We're very much on that hunt, Daniel. We just, over the last few quarters, haven't been able to bring across something that we thought made sense for our value creation problem. Thank you. I'll pass the line. Our next question comes from Adam Wilk of Greystone Capital Management. Please go ahead. Hi. Good morning. Thanks for taking my questions. You guys had, there's been a lot of focus on the sort of inflection of SaaS revenue growth in the near term and I guess over time. But you had previously mentioned the sort of balance of your internal capabilities and resources, making sure that the customers are taken care of rather than just plowing forward with as much growth as possible. Do you still feel like that remains the case in terms of where you sit today? Or can we just get an update on that sort of, I guess, bottleneck, my word, not yours, in terms of where that sits today? Hey, Adam. Good morning. Yeah, great question. And I think it's kind of somewhat of an adaptation of a prior one. We do see, undoubtedly, SaaS ARR revenue growth increasing. We're just trying to make sure that through mid-2025, we're not overstating what we believe is possible, but our capacity is growing both in terms of our direct and indirect. The efficacy is sky-high and our ability to have greater implementation capacity with partners now being able to stand on their own two feet and deliver that. So that allows us to get to SaaS ARR more quickly and through implementations with a high degree of success. So I would say that we are coming out of the bottleneck. We're still considered the success to be precious. We're not necessarily just saying, "Come one, come all," but we're now in a mode where we have clear visibility to greater capacity both on the booking side and in all three markets, whereas we were kind of a single-piston machine before. So I will generally say that in the back half of 2025, we see, and I tried to speak to that in my opening comments, that we see strengthening, acceleration, and leverage as we get into the back half of 2025. Okay. Excellent. And then just an update on capital allocation and priorities would be great. I know a previous caller asked about M&A, and maybe I'll just add, if there was a deal that made sense for you guys, could you just talk about what that might look like in terms of would it be, are you more focused on the product side, geography, type of customer? Would just love to get your thoughts on that. Thanks. Sure. It really does continue to be consistent with where we were previously. We will look at exercising our NCIB. We still feel there's lots of headroom in share value, and so we do, and the renewal of our NCIB undoubtedly will be occurring, and we'll be exercising that as the board sees fit, but that continues to be a value creation opportunity for our shareholders. On the M&A side, I'm staying true to my word there. Our win rate reflects we are very, very competitive on the IP side, but that does not in any way prohibit us from bolt-on, add-on IP to our platform. That's the concept of a platform where we can easily think about complementary synergistic IP that would apply to a school district, to a municipality, and to a charity. So we look at it from the standpoint of strategic, I don't want to call them just tuck-ins, it could be material, as well as the idea of how do we think about customer density as a key priority of M&A. Can we find an entity that maybe has legacy solutions that has a good customer cohort that has made the decision that they are not going to bridge to a full SaaS platform, or that is the risk in cash to do so is going to be too daunting? So that is very attractive in terms of our crosshairs of where we could already have existing technology and think about a deal and a deal structure that would allow an owner of a legacy customer community to work with us to upgrade those customers to our platform. Also on the M&A side, it may not always be an acquisition because we now have a broadened partner community. They have relationships with many, many solution providers that may not be in the business to be thinking of sale, but may be in a situation where they and we can derive royalties and dollars from them plugging into our platform and having access to our customer community. That's another area where we see revenue opportunity, not necessarily through acquisition, but through kind of partnering with synergistic providers. That necessarily isn't capital allocation required, but it broadens out how we think about adding value and adding scale. M&A, for as I said in my closing, we see Sylogist as a materially larger enterprise with leverage. That's both organic as well as inorganic. We're committed to both sides, and we have the team, we have the muscle memory, and we have a really good playbook to be able to think about acquisitions in a positive light. Excellent. Thank you. Just one follow-up on the synergistic partner efforts that you mentioned as a source of revenue. What has to take place for you to sort of turn that on, so to speak? Not a lot. Not a lot has to happen technically. We're continuing to build out our API suite to make that happen in a way that is kind of doesn't require, don't look behind the curtain, but is very much plug and play. Because we are part of that Microsoft Business Central as well as CRM platform, we get a lot of those plug-ins that happen technically kind of out of the box. So it's just really making sure that we are first focusing on our own knitting and bringing customers on and making sure that we have really good success in that gov and ed sector at a high level, and it's very repeatable. And then we think about complementary IP. But those discussions and those from a strategy standpoint are already going on, and our Director of Partnerships and our Chief Revenue Officer, Grant McLaren, are all ears and engaged in conversations around what that could look like going forward. Okay. Excellent. And then last question for me. You obviously know the sort of margin targets or sort of soft guidance that you've given in terms of your level of investment. But as you scale, I think I maybe ask this question every quarter, but as you scale, if there's opportunity to invest more or to throw some dollars at something you're trying to accomplish, whether it's whitespace, displacement, are you comfortable maybe giving up some margin to do that? Are you holding firm on where you guys are? Can you just talk a little bit about the trade-off there? I'll try to be consistent. We undoubtedly still, because it's foundational to our thesis as well as kind of how we're thinking and what the board is thinking about in terms of building the business, profitable growth is key. We're not looking to drain the piggy bank and try to Hail Mary. But undoubtedly, when we have that kind of efficacy in our close and win rates happening, it certainly supports more and more lean-in in terms of, and the questions happened a few different ways today on the call here. We're very comfortable with more lean-in because it now is, if we can get one plus one equals three or four because of our sales and marketing motions and the efficacy of then also the wallet share expansion that we're seeing. The lean-in for us to be able to think about top line. It's a big part of how we think about it. Again, I just want to say our top line right now growth is just wonky because we're decelerating a major contributor to what that was in years past on project services. That's purposeful. And so I just bring that back as a key theme. We want to get to SaaS ARR. That is happening now at a good clip. We see that expanding going forward, and we see it expanding with leverage in terms of the sales, marketing motions directly, as well as the idea of what our partners can add to our leverage on the sales and marketing side, so growth continues to be focused, and we will think about a balanced Rule of 40 discipline, but ultimately how that flutters between growth and EBITDA will be something that is generally opportunistic as we think about it. Now is the time. We've put in the investments. We've actually now come to market. There's a lot of excitement. We'd be remiss not to lean in and push on that, but it's going to still be done through that Rule of 40 posture and the discipline that we've demonstrated so far. Understood. Got it. Thank you. Yeah, that's it for me. Thank you very much, and keep up the great work. This concludes the question and answer session. I would like to turn the call back over to Mr. Bill Wood for any closing remarks. Yeah, I appreciate the questions, and I really appreciate the continuing support of our investor community. Excited about new dollars coming into the story that maybe we just didn't have enough breadcrumbs of performance to bring them in and bring them to the table. That's an exciting development for us, and we're very pleased that we're looking at an investor community that's been really incredibly supportive of our efforts. And I guess coming through a four-year anniversary just a couple of days ago for me coming into the company, I couldn't be more proud of what Sylogist has been able to accomplish over that time, not to my credit, but to the credit of the team and how much we've really stayed true to our mantra. If we can get our customers at a good point, get our technology at a good point, there's very little to hold us back as we think about growing our footprint within the three sectors. So that is at a higher state of excitement for me than ever before. I continue to think about our team being the best in the business. I feel like the foundation we've laid at this point positions us well for really good things ahead, and I appreciate the support of our investor community and certainly our board, which is at an all-time, I guess I've never felt more supported, but I say that through a board that has now got really good expertise, really good wisdom, really good perspectives of companies at scale, technology companies, SaaS companies, the commercial side, the financial side. So I also want to give credit to our board and appreciation to our board. Our board punches above its weight class. I think our management team does the same, and I think Sylogist, from the standpoint of our execution, is really hitting on our cylinders very well. So thank you for your time today. Thank you for your continued support. Be well. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.

Speaker 6: Thank you for standing by. This is the conference operator. Welcome to the Sylogist Limited third quarter 2024 results conference call and webcast. As a reminder, all participants are in listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star, then one, on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star, then zero. I would like now to turn the conference over to Jennifer Smith with LodeRock Advisors. Please go ahead. Thank you for standing by. thank you for standing by This is the conference operator. this is the conference operator Welcome to the Sylogist Limited third quarter 2024 results conference call and webcast. welcome to the sylogist limited third quarter 2024 results conference call and webcast As a reminder, all participants are in listen-only mode, and the conference is being recorded. as a reminder all participants are in listen-only mode and the conference is being recorded After the presentation, there will be an opportunity to ask questions. after the presentation there will be an opportunity to ask questions To join the question queue, you may press star, then one, on your telephone keypad. to join the question queue you may press star then one on your telephone keypad Should you need assistance during the conference call, you may signal an operator by pressing star, then zero. should you need assistance during the conference call you may signal an operator by pressing star then zero I would like now to turn the conference over to Jennifer Smith with LodeRock Advisors. i would like now to turn the conference over to jennifer smith with loderock advisors Please go ahead. please go ahead

Speaker 3: Thank you, Alan, and good morning. Joining me to discuss Sylogist Q3 fiscal 2024 results are Bill Wood, Sylogist President and Chief Executive Officer, and Sujeet Kini, Chief Financial Officer. This call is being recorded live at 8:30 A.M. Eastern Time on November 7th, 2024. Our Q3 press release and MD&A financial statements and accompanying notes have been issued and are available for download on SEDAR+. Please note that some of the statements made on the call may be forward-looking. Actual events or results may differ materially from those expressed or implied, and Sylogist disclaims any intent or obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise. The complete Safe Harbor statement is available in both our MD&A and press release, as well as on sylogist.com. We encourage our investors to read it in its entirety. Thank you, Alan, and good morning. thank you alan and good morning Joining me to discuss Sylogist Q3 fiscal 2024 results are Bill Wood, Sylogist President and Chief Executive Officer, and Sujeet Kini, Chief Financial Officer. joining me to discuss sylogist q3 fiscal 2024 results are bill wood sylogist president and chief executive officer and sujeet kini chief financial officer This call is being recorded live at 8:30 A.M. this call is being recorded live at 8:30 a.m Eastern Time on November 7th, 2024. eastern time on november 7th 2024 Our Q3 press release and MD&A financial statements and accompanying notes have been issued and are available for download on SEDAR+. our q3 press release and md&a financial statements and accompanying notes have been issued and are available for download on sedar+ Please note that some of the statements made on the call may be forward-looking. please note that some of the statements made on the call may be forward-looking Actual events or results may differ materially from those expressed or implied, and Sylogist disclaims any intent or obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise. actual events or results may differ materially from those expressed or implied and sylogist disclaims any intent or obligation to update or revise any forward-looking statement whether as a result of new information future events or otherwise The complete Safe Harbor statement is available in both our MD&A and press release, as well as on sylogist.com. the complete safe harbor statement is available in both our md&a and press release as well as on sylogist.com We encourage our investors to read it in its entirety. we encourage our investors to read it in its entirety We are reporting our financial results in accordance with International Financial Reporting Standards, or IFRS. Before, we will also discuss non-GAAP performance measures, which should be reviewed as supplemental. The MD&A contains definitions of each one used in our reporting. All of the dollar figures expressed on this call are in Canadian unless otherwise noted. I'll turn it over to Bill first with opening remarks, and Sujeet will review our Q3 financial performance, after which Bill will conclude scripted remarks, at which time we will open it up for questions. Bill? We are reporting our financial results in accordance with International Financial Reporting Standards, or IFRS. we are reporting our financial results in accordance with international financial reporting standards or ifrs Before, we will also discuss non-GAAP performance measures, which should be reviewed as supplemental. before we will also discuss non-gaap performance measures which should be reviewed as supplemental The MD&A contains definitions of each one used in our reporting. the md&a contains definitions of each one used in our reporting All of the dollar figures expressed on this call are in Canadian unless otherwise noted. all of the dollar figures expressed on this call are in canadian unless otherwise noted I'll turn it over to Bill first with opening remarks, and Sujeet will review our Q3 financial performance, after which Bill will conclude scripted remarks, at which time we will open it up for questions. i'll turn it over to bill first with opening remarks and sujeet will review our q3 financial performance after which bill will conclude scripted remarks at which time we will open it up for questions Bill? bill

Speaker 9: Thank you, Jen. Good morning and good afternoon to those of you joining us overseas. Building on the momentum we generated the first half of 2024, it was a strong Q3 for the business. Our results continue to validate the successful transition to a SaaS-driven enterprise, with growing recurring revenue, an effective and engaged partner network, and an expanding presence across our three strategic markets. In short, we're very pleased with the results we're seeing from the execution of our value creation strategy. I'd like to add some color to our Q3 performance. We saw 14% year-over-year bookings growth in the quarter. Especially encouraging was our success with customer upsells and cross-sells, that's largely attributable to happy customers using more of what our SaaS platforms now offer. I also want to highlight that nearly 40% of our bookings came from our SylogistEd sector. Thank you, Jen. thank you jen Good morning and good afternoon to those of you joining us overseas. good morning and good afternoon to those of you joining us overseas Building on the momentum we generated the first half of 2024, it was a strong Q3 for the business. building on the momentum we generated the first half of 2024 it was a strong q3 for the business Our results continue to validate the successful transition to a SaaS-driven enterprise, with growing recurring revenue, an effective and engaged partner network, and an expanding presence across our three strategic markets. our results continue to validate the successful transition to a saas-driven enterprise with growing recurring revenue an effective and engaged partner network and an expanding presence across our three strategic markets In short, we're very pleased with the results we're seeing from the execution of our value creation strategy. in short we're very pleased with the results we're seeing from the execution of our value creation strategy I'd like to add some color to our Q3 performance. i'd like to add some color to our q3 performance We saw 14% year-over-year bookings growth in the quarter. we saw 14% year-over-year bookings growth in the quarter Especially encouraging was our success with customer upsells and cross-sells, that's largely attributable to happy customers using more of what our SaaS platforms now offer. especially encouraging was our success with customer upsells and cross-sells that's largely attributable to happy customers using more of what our saas platforms now offer I also want to highlight that nearly 40% of our bookings came from our SylogistEd sector. i also want to highlight that nearly 40% of our bookings came from our sylogisted sector Reflecting the continued acceleration I've been signaling was on the horizon is now clearly occurring. The success we're seeing from our targeted competitor displacement strategy, the success of our SaaS offerings relative to the competitive landscape, and strong customer referrals drove our overall win rate even higher to above 70% in Q3. This impressive win rate is inclusive of both direct and partner-led sales motions. We're now seeing an increasingly balanced pipeline in bookings across all three strategic markets: SylogistMission, SylogistEd, and SylogistGov. At the end of Q3, our bookings pipeline is up 122% year-over-year. These leading indicators bode well for more balanced SaaS ARR growth across all three sectors as we look out to 2025 and beyond. One of the pillars of our value creation strategy is a carefully selected, aligned, and enabled partner network to allow us to scale profitably and capture market opportunity quickly. Reflecting the continued acceleration I've been signaling was on the horizon is now clearly occurring. reflecting the continued acceleration i've been signaling was on the horizon is now clearly occurring The success we're seeing from our targeted competitor displacement strategy, the success of our SaaS offerings relative to the competitive landscape, and strong customer referrals drove our overall win rate even higher to above 70% in Q3. the success we're seeing from our targeted competitor displacement strategy the success of our saas offerings relative to the competitive landscape and strong customer referrals drove our overall win rate even higher to above 70% in q3 This impressive win rate is inclusive of both direct and partner-led sales motions. this impressive win rate is inclusive of both direct and partner-led sales motions We're now seeing an increasingly balanced pipeline in bookings across all three strategic markets: SylogistMission, SylogistEd, and SylogistGov. we're now seeing an increasingly balanced pipeline in bookings across all three strategic markets sylogistmission sylogisted and sylogistgov At the end of Q3, our bookings pipeline is up 122% year-over-year. at the end of q3 our bookings pipeline is up 122% year-over-year These leading indicators bode well for more balanced SaaS ARR growth across all three sectors as we look out to 2025 and beyond. these leading indicators bode well for more balanced saas arr growth across all three sectors as we look out to 2025 and beyond One of the pillars of our value creation strategy is a carefully selected, aligned, and enabled partner network to allow us to scale profitably and capture market opportunity quickly. one of the pillars of our value creation strategy is a carefully selected aligned and enabled partner network to allow us to scale profitably and capture market opportunity quickly It's been just over a year since we turned earnest attention to building a strong partner community, and we're well ahead of plan in terms of the results we're seeing. As of Q3, partner-attached bookings have grown more than 700% year-over-year and grew 52% quarter-over-quarter. Partner-attached bookings represented almost 50% of our total bookings this quarter, compared to just 7% in Q3 of 2023. In our SylogistMission and SylogistGov sectors, so net of SylogistEd where we don't yet engage partners, partner-attached bookings came in at 77% of total bookings. Again, a very strong result for a KPI that bodes well for future value creation. To help ensure project implementation success, we continue to maintain our expert internal team to both empower the expanding partner community as well as deliver SylogistMission, SylogistGov, and SylogistEd project services to customers directly. It's been just over a year since we turned earnest attention to building a strong partner community, and we're well ahead of plan in terms of the results we're seeing. it's been just over a year since we turned earnest attention to building a strong partner community and we're well ahead of plan in terms of the results we're seeing As of Q3, partner-attached bookings have grown more than 700% year-over-year and grew 52% quarter-over-quarter. as of q3 partner-attached bookings have grown more than 700% year-over-year and grew 52% quarter-over-quarter Partner-attached bookings represented almost 50% of our total bookings this quarter, compared to just 7% in Q3 of 2023. partner-attached bookings represented almost 50% of our total bookings this quarter compared to just 7% in q3 of 2023 In our SylogistMission and SylogistGov sectors, so net of SylogistEd where we don't yet engage partners, partner-attached bookings came in at 77% of total bookings. in our sylogistmission and sylogistgov sectors so net of sylogisted where we don't yet engage partners partner-attached bookings came in at 77% of total bookings Again, a very strong result for a KPI that bodes well for future value creation. again a very strong result for a kpi that bodes well for future value creation To help ensure project implementation success, we continue to maintain our expert internal team to both empower the expanding partner community as well as deliver SylogistMission, SylogistGov, and SylogistEd project services to customers directly. to help ensure project implementation success we continue to maintain our expert internal team to both empower the expanding partner community as well as deliver sylogistmission sylogistgov and sylogisted project services to customers directly As our community of high-quality partners becomes more self-sufficient, we see increasing leverage in sales and, even more importantly, broader implementation capacity in the back half of 2025 and beyond. As we execute our channel strategy, one of the outcomes is the accelerating handoff of our direct-to-customer project service revenue. This effectively inhibits our top-line revenue growth in the near term as we settle to a new top-line revenue mix that's increasingly comprised of more lucrative SaaS ARR. As I've said previously, this is an exciting, purposeful shift, and we're very pleased it's happening at a faster-than-expected clip as it validates that our partner strategy is working. To that end, strong execution continues to drive robust growth in our higher-margin ILTB SaaS ARR, as well as our SaaS NRR. As our community of high-quality partners becomes more self-sufficient, we see increasing leverage in sales and, even more importantly, broader implementation capacity in the back half of 2025 and beyond. as our community of high-quality partners becomes more self-sufficient we see increasing leverage in sales and even more importantly broader implementation capacity in the back half of 2025 and beyond As we execute our channel strategy, one of the outcomes is the accelerating handoff of our direct-to-customer project service revenue. as we execute our channel strategy one of the outcomes is the accelerating handoff of our direct-to-customer project service revenue This effectively inhibits our top-line revenue growth in the near term as we settle to a new top-line revenue mix that's increasingly comprised of more lucrative SaaS ARR. this effectively inhibits our top-line revenue growth in the near term as we settle to a new top-line revenue mix that's increasingly comprised of more lucrative saas arr As I've said previously, this is an exciting, purposeful shift, and we're very pleased it's happening at a faster-than-expected clip as it validates that our partner strategy is working. as i've said previously this is an exciting purposeful shift and we're very pleased it's happening at a faster-than-expected clip as it validates that our partner strategy is working To that end, strong execution continues to drive robust growth in our higher-margin ILTB SaaS ARR, as well as our SaaS NRR. to that end strong execution continues to drive robust growth in our higher-margin iltb saas arr as well as our saas nrr Our SaaS ARR increased by 13% year-over-year to just shy of CAD 30 million, and SaaS NRR came in at a healthy 107%. I'll pause here and let Sujeet take you through our financial performance for the quarter in a little more detail. Sujeet? Our SaaS ARR increased by 13% year-over-year to just shy of CAD 30 million, and SaaS NRR came in at a healthy 107%. our saas arr increased by 13% year-over-year to just shy of cad 30 million and saas nrr came in at a healthy 107% I'll pause here and let Sujeet take you through our financial performance for the quarter in a little more detail. i'll pause here and let sujeet take you through our financial performance for the quarter in a little more detail Sujeet? sujeet

Speaker 7: Thank you, Bill. Good morning, good afternoon, everybody. Before we get into the numbers, I wanted to remind everyone that in Q2 2024, we completed the divestiture of our Managed IT Services division. In order to facilitate an apples-to-apples comparison of key financial and operating metrics, all comparisons to prior periods have been adjusted to reflect the sale of this division. Additionally, within our Q3 2024 MD&A, we have included, for your reference, a four-quarter table that quantifies the revenue and Adjusted EBITDA impacts of the Managed IT Services division. As Bill mentioned, our Q3 results demonstrate the meaningful transformation of Sylogist into a SaaS enterprise while staying focused on profitable growth. Total revenue for the quarter was CAD 16.6 million, led by 15% growth in our SaaS subscription revenues. Thank you, Bill. thank you bill Good morning, good afternoon, everybody. good morning good afternoon everybody Before we get into the numbers, I wanted to remind everyone that in Q2 2024, we completed the divestiture of our Managed IT Services division. before we get into the numbers i wanted to remind everyone that in q2 2024 we completed the divestiture of our managed it services division In order to facilitate an apples-to-apples comparison of key financial and operating metrics, all comparisons to prior periods have been adjusted to reflect the sale of this division. in order to facilitate an apples-to-apples comparison of key financial and operating metrics all comparisons to prior periods have been adjusted to reflect the sale of this division Additionally, within our Q3 2024 MD&A, we have included, for your reference, a four-quarter table that quantifies the revenue and Adjusted EBITDA impacts of the Managed IT Services division. additionally within our q3 2024 md&a we have included for your reference a four-quarter table that quantifies the revenue and adjusted ebitda impacts of the managed it services division As Bill mentioned, our Q3 results demonstrate the meaningful transformation of Sylogist into a SaaS enterprise while staying focused on profitable growth. as bill mentioned our q3 results demonstrate the meaningful transformation of sylogist into a saas enterprise while staying focused on profitable growth Total revenue for the quarter was CAD 16.6 million, led by 15% growth in our SaaS subscription revenues. total revenue for the quarter was cad 16.6 million led by 15% growth in our saas subscription revenues This growth was partially offset by an anticipated decrease in project services revenue related to our strategic shift to a partner-led delivery model. Overall revenue growth continues to be driven primarily by our SylogistMission segment that grew at 15% year-over-year, closely followed by our SylogistEd segment that grew by 10% year-over-year. Q3's overall comparative year-over-year revenue growth was additionally impacted by significant levels of non-core hardware sales that happened in Q3 2023. I want to remind everyone that we had a large hardware booking within our Sylogist Solutions business segment in Q3 2023, and this was in the amount of CAD 545,000. So absent the impact of this hardware sale in Q3 2023, year-over-year top-line revenue growth would have been approximately in the 6% growth range. That is, year-over-year Q3 2024 versus Q3 2023. This growth was partially offset by an anticipated decrease in project services revenue related to our strategic shift to a partner-led delivery model. this growth was partially offset by an anticipated decrease in project services revenue related to our strategic shift to a partner-led delivery model Overall revenue growth continues to be driven primarily by our SylogistMission segment that grew at 15% year-over-year, closely followed by our SylogistEd segment that grew by 10% year-over-year. overall revenue growth continues to be driven primarily by our sylogistmission segment that grew at 15% year-over-year closely followed by our sylogisted segment that grew by 10% year-over-year Q3's overall comparative year-over-year revenue growth was additionally impacted by significant levels of non-core hardware sales that happened in Q3 2023. q3's overall comparative year-over-year revenue growth was additionally impacted by significant levels of non-core hardware sales that happened in q3 2023 I want to remind everyone that we had a large hardware booking within our Sylogist Solutions business segment in Q3 2023, and this was in the amount of CAD 545,000. i want to remind everyone that we had a large hardware booking within our sylogist solutions business segment in q3 2023 and this was in the amount of cad 545,000 So absent the impact of this hardware sale in Q3 2023, year-over-year top-line revenue growth would have been approximately in the 6% growth range. so absent the impact of this hardware sale in q3 2023 year-over-year top-line revenue growth would have been approximately in the 6% growth range That is, year-over-year Q3 2024 versus Q3 2023. that is year-over-year q3 2024 versus q3 2023 Our gross profit margin for Q3 2024 was relatively consistent, with recent quarters coming in at 60% for the current quarter. Total operating expenses for Q3 2024 were also relatively consistent at 34% of revenue, compared with 35% during the same period last year. G&A expenses decreased by CAD 0.6 million to CAD 2.7 million in Q3 2024, compared with the corresponding period last year, coming in at 16% of revenues compared to 19% of revenues in Q3 2023. This decrease in G&A is a result of various operational savings in the current quarter. Sales and marketing expenses for Q3 2024 were CAD 2 million, or 12% of revenue, compared to CAD 1.7 million, or 11% of revenue in the same period last year. This increase was due to anticipated strategic investments made in additional sales quota-carrying headcount and increased marketing programmatic spending, including the spend on our SylogistEd user conference. Our gross profit margin for Q3 2024 was relatively consistent, with recent quarters coming in at 60% for the current quarter. our gross profit margin for q3 2024 was relatively consistent with recent quarters coming in at 60% for the current quarter Total operating expenses for Q3 2024 were also relatively consistent at 34% of revenue, compared with 35% during the same period last year. total operating expenses for q3 2024 were also relatively consistent at 34% of revenue compared with 35% during the same period last year G&A expenses decreased by CAD 0.6 million to CAD 2.7 million in Q3 2024, compared with the corresponding period last year, coming in at 16% of revenues compared to 19% of revenues in Q3 2023. g&a expenses decreased by cad 0.6 million to cad 2.7 million in q3 2024 compared with the corresponding period last year coming in at 16% of revenues compared to 19% of revenues in q3 2023 This decrease in G&A is a result of various operational savings in the current quarter. this decrease in g&a is a result of various operational savings in the current quarter Sales and marketing expenses for Q3 2024 were CAD 2 million, or 12% of revenue, compared to CAD 1.7 million, or 11% of revenue in the same period last year. sales and marketing expenses for q3 2024 were cad 2 million or 12% of revenue compared to cad 1.7 million or 11% of revenue in the same period last year This increase was due to anticipated strategic investments made in additional sales quota-carrying headcount and increased marketing programmatic spending, including the spend on our SylogistEd user conference. this increase was due to anticipated strategic investments made in additional sales quota-carrying headcount and increased marketing programmatic spending including the spend on our sylogisted user conference Our sales and marketing FTE headcount increased to 26 people at the end of Q3 2024, up from 22 people at the end of Q3 2023. Net R&D expenses for Q3 2024 were consistent at 6% of revenue for Q3 2024, compared to 5% of revenue for Q3 2023. Similarly, gross R&D expenses were consistent at 14% of revenue for both periods. Adjusted EBITDA for Q3 2024 was CAD 4.2 million, and our adjusted EBITDA margin came in as expected at 25.3% in the current quarter, compared to 27.2% in Q3 2023. At the end of Q3 2024, we had CAD 13 million in cash. This level of cash is in line with the seasonality of our operations and the renewal cycle of a material cohort of our SylogistEd customer community. On October 31, 2024, we renewed our corporate credit facility. Our sales and marketing FTE headcount increased to 26 people at the end of Q3 2024, up from 22 people at the end of Q3 2023. our sales and marketing fte headcount increased to 26 people at the end of q3 2024 up from 22 people at the end of q3 2023 Net R&D expenses for Q3 2024 were consistent at 6% of revenue for Q3 2024, compared to 5% of revenue for Q3 2023. net r&d expenses for q3 2024 were consistent at 6% of revenue for q3 2024 compared to 5% of revenue for q3 2023 Similarly, gross R&D expenses were consistent at 14% of revenue for both periods. similarly gross r&d expenses were consistent at 14% of revenue for both periods Adjusted EBITDA for Q3 2024 was CAD 4.2 million, and our adjusted EBITDA margin came in as expected at 25.3% in the current quarter, compared to 27.2% in Q3 2023. adjusted ebitda for q3 2024 was cad 4.2 million and our adjusted ebitda margin came in as expected at 25.3% in the current quarter compared to 27.2% in q3 2023 At the end of Q3 2024, we had CAD 13 million in cash. at the end of q3 2024 we had cad 13 million in cash This level of cash is in line with the seasonality of our operations and the renewal cycle of a material cohort of our SylogistEd customer community. this level of cash is in line with the seasonality of our operations and the renewal cycle of a material cohort of our sylogisted customer community On October 31, 2024, we renewed our corporate credit facility. on october 31 2024 we renewed our corporate credit facility The renewal now includes a revolver for CAD 50 million, that's CAD 50 million, with an additional CAD 75 million optional accordion feature. This is in comparison to the prior facility, which is essentially a revolver for a headline amount of CAD 125 million. The new credit facility is committed for a three-year term and is renewable annually thereafter. We purposefully constructed the renewal in this manner, as it saves us approximately CAD 200,000 in standby fees annually, while at the same time preserving access to the same borrowing range that we would have had under the prior facility. And finally, I would also like to point out that at the end of this quarter, we completed the three-year anniversary of the Mission CRM acquisition and its related earnout. Inclusive of the accruals for the third-year earnout, the total purchase consideration for this acquisition is approximately CAD 7.8 million. The renewal now includes a revolver for CAD 50 million, that's CAD 50 million, with an additional CAD 75 million optional accordion feature. the renewal now includes a revolver for cad 50 million that's cad 50 million with an additional cad 75 million optional accordion feature This is in comparison to the prior facility, which is essentially a revolver for a headline amount of CAD 125 million. this is in comparison to the prior facility which is essentially a revolver for a headline amount of cad 125 million The new credit facility is committed for a three-year term and is renewable annually thereafter. the new credit facility is committed for a three-year term and is renewable annually thereafter We purposefully constructed the renewal in this manner, as it saves us approximately CAD 200,000 in standby fees annually, while at the same time preserving access to the same borrowing range that we would have had under the prior facility. we purposefully constructed the renewal in this manner as it saves us approximately cad 200,000 in standby fees annually while at the same time preserving access to the same borrowing range that we would have had under the prior facility And finally, I would also like to point out that at the end of this quarter, we completed the three-year anniversary of the Mission CRM acquisition and its related earnout. and finally i would also like to point out that at the end of this quarter we completed the three-year anniversary of the mission crm acquisition and its related earnout Inclusive of the accruals for the third-year earnout, the total purchase consideration for this acquisition is approximately CAD 7.8 million. inclusive of the accruals for the third-year earnout the total purchase consideration for this acquisition is approximately cad 7.8 million We're extremely pleased to say that the overall ARR for Mission CRM at the three-year point, or at the three-year mark, is CAD 1.9 million. This compared to CAD 140,000 when we acquired Mission CRM back in October 2021. All of this is a compounded annual growth of approximately 141%. And so this acquisition, we believe, has undoubtedly strengthened our Mission platform, and team. With that, I will hand it back to you, Bill. We're extremely pleased to say that the overall ARR for Mission CRM at the three-year point, or at the three-year mark, is CAD 1.9 million. we're extremely pleased to say that the overall arr for mission crm at the three-year point or at the three-year mark is cad 1.9 million This compared to CAD 140,000 when we acquired Mission CRM back in October 2021. this compared to cad 140,000 when we acquired mission crm back in october 2021 All of this is a compounded annual growth of approximately 141%. all of this is a compounded annual growth of approximately 141% And so this acquisition, we believe, has undoubtedly strengthened our Mission platform, and team. and so this acquisition we believe has undoubtedly strengthened our mission platform and team With that, I will hand it back to you, Bill. with that i will hand it back to you bill

Speaker 9: Thank you, Sujeet. With our three leading SaaS platforms now in market, our competitor displacement strategy gaining traction, and the successful shift to a partner-driven model, we're well positioned to deliver increasingly profitable growth that's scalable, repeatable, and aligned with long-term value creation. To the credit of our outstanding team and a customer-first mindset, our investments are yielding the desired results. We've laid the foundation for growing very sticky recurring revenue, expanding free cash flow, and enhanced margins that we expect to become even more evident in the back half of 2025. Make no mistake, we envision a day when Sylogist is a materially larger enterprise with operating leverage. Thank you for your continued confidence and support as we push Sylogist to new heights. With that, let's take some questions. Thank you, Sujeet. thank you sujeet With our three leading SaaS platforms now in market, our competitor displacement strategy gaining traction, and the successful shift to a partner-driven model, we're well positioned to deliver increasingly profitable growth that's scalable, repeatable, and aligned with long-term value creation. with our three leading saas platforms now in market our competitor displacement strategy gaining traction and the successful shift to a partner-driven model we're well positioned to deliver increasingly profitable growth that's scalable repeatable and aligned with long-term value creation To the credit of our outstanding team and a customer-first mindset, our investments are yielding the desired results. to the credit of our outstanding team and a customer-first mindset our investments are yielding the desired results We've laid the foundation for growing very sticky recurring revenue, expanding free cash flow, and enhanced margins that we expect to become even more evident in the back half of 2025. we've laid the foundation for growing very sticky recurring revenue expanding free cash flow and enhanced margins that we expect to become even more evident in the back half of 2025 Make no mistake, we envision a day when Sylogist is a materially larger enterprise with operating leverage. make no mistake we envision a day when sylogist is a materially larger enterprise with operating leverage Thank you for your continued confidence and support as we push Sylogist to new heights. thank you for your continued confidence and support as we push sylogist to new heights With that, let's take some questions. with that let's take some questions

Speaker 6: We will now begin the question-and-answer session. To ask a question, you may press Star, then one on your touch-tone phone. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press Star, then two. We will pause momentarily to assemble our roster. Our first question comes from Amr Ezzat from Ventum Capital Markets. Please go ahead. We will now begin the question-and-answer session. we will now begin the question-and-answer session To ask a question, you may press Star, then one on your touch-tone phone. to ask a question you may press star then one on your touch-tone phone If you're using a speakerphone, please pick up your handset before pressing any keys. if you're using a speakerphone please pick up your handset before pressing any keys To withdraw your question, please press Star, then two. to withdraw your question please press star then two We will pause momentarily to assemble our roster. we will pause momentarily to assemble our roster Our first question comes from Amr Ezzat from Ventum Capital Markets. our first question comes from amr ezzat from ventum capital markets Please go ahead. please go ahead

Speaker 8: Good morning, Bill and Sujeet. Just a few questions. The first one, can you update us on the pace of your targeted competitor displacement? I'm wondering how does it compare to the previous few quarters? Is it holding steady, or are you seeing it accelerate? Good morning, Bill and Sujeet. good morning bill and sujeet Just a few questions. just a few questions The first one, can you update us on the pace of your targeted competitor displacement? the first one can you update us on the pace of your targeted competitor displacement I'm wondering how does it compare to the previous few quarters? i'm wondering how does it compare to the previous few quarters Is it holding steady, or are you seeing it accelerate? is it holding steady or are you seeing it accelerate

Speaker 9: Good morning, Amr. We're actually seeing it accelerate. We're expanding the aperture of who those targeted competitors are as our now all three platforms are in market. So we have crosshairs in the Ed, Gov, and Mission segment. Within the mission segment specifically, we're seeing good strength in that area, continuing strength and better efficiencies as we work through each and every one and light up new customers from a given competitor. So the momentum is building. We feel really good. It's sustainable for many quarters ahead. Good morning, Amr. good morning amr We're actually seeing it accelerate. we're actually seeing it accelerate We're expanding the aperture of who those targeted competitors are as our now all three platforms are in market. we're expanding the aperture of who those targeted competitors are as our now all three platforms are in market So we have crosshairs in the Ed, Gov, and Mission segment. so we have crosshairs in the ed gov and mission segment Within the mission segment specifically, we're seeing good strength in that area, continuing strength and better efficiencies as we work through each and every one and light up new customers from a given competitor. within the mission segment specifically we're seeing good strength in that area continuing strength and better efficiencies as we work through each and every one and light up new customers from a given competitor So the momentum is building. so the momentum is building We feel really good. we feel really good It's sustainable for many quarters ahead. it's sustainable for many quarters ahead

Speaker 8: Fantastic. On your NRR for the quarter, and still just Ed's, we saw a slight dip in NRR quarter-over-quarter. I also expected to see a bigger sales number in education, especially with the strong bookings last quarter. The MD&A notes some anticipated attrition in the vertical that's impacted NRR. Can you maybe give us color on that? Fantastic. fantastic On your NRR for the quarter, and still just Ed's, we saw a slight dip in NRR quarter-over-quarter. on your nrr for the quarter and still just ed's we saw a slight dip in nrr quarter-over-quarter I also expected to see a bigger sales number in education, especially with the strong bookings last quarter. i also expected to see a bigger sales number in education especially with the strong bookings last quarter The MD&A notes some anticipated attrition in the vertical that's impacted NRR. the md&a notes some anticipated attrition in the vertical that's impacted nrr Can you maybe give us color on that? can you maybe give us color on that

Speaker 9: For sure. There were some legacy customers that deepened their cycle in terms of where they fit with our go-forward SylogistEd strategy. So I would consider that the kind of cycling of some strategic attrition that we had identified several customers within the legacy customer community that really weren't a good fit for the go-forward. And so because of the budgeting cycle, they kind of went off as a cohort in that Q3 timeframe. Nothing really should be derived from that as any kind of churn picking up or whatever. It was really more of a strategic churn in that than anything that gives us pause. For sure. for sure There were some legacy customers that deepened their cycle in terms of where they fit with our go-forward SylogistEd strategy. there were some legacy customers that deepened their cycle in terms of where they fit with our go-forward sylogisted strategy So I would consider that the kind of cycling of some strategic attrition that we had identified several customers within the legacy customer community that really weren't a good fit for the go-forward. so i would consider that the kind of cycling of some strategic attrition that we had identified several customers within the legacy customer community that really weren't a good fit for the go-forward And so because of the budgeting cycle, they kind of went off as a cohort in that Q3 timeframe. and so because of the budgeting cycle they kind of went off as a cohort in that q3 timeframe Nothing really should be derived from that as any kind of churn picking up or whatever. nothing really should be derived from that as any kind of churn picking up or whatever It was really more of a strategic churn in that than anything that gives us pause. it was really more of a strategic churn in that than anything that gives us pause

Speaker 8: Okay. Is that mostly done, or do you foresee more of that over the coming quarters? Okay. okay Is that mostly done, or do you foresee more of that over the coming quarters? is that mostly done or do you foresee more of that over the coming quarters

Speaker 9: We see that mostly done. Well, there may be the odd here and there, but ultimately, we have a good sightline to that community. We've been engaged with them for several years now, and we have a very good handle on the go-forward. We think anything that would happen churn-wise would be minor as we think about the go-forward. We see that mostly done. we see that mostly done Well, there may be the odd here and there, but ultimately, we have a good sightline to that community. well there may be the odd here and there but ultimately we have a good sightline to that community We've been engaged with them for several years now, and we have a very good handle on the go-forward. we've been engaged with them for several years now and we have a very good handle on the go-forward We think anything that would happen churn-wise would be minor as we think about the go-forward. we think anything that would happen churn-wise would be minor as we think about the go-forward

Speaker 8: Great. Then, I guess on your partner strategy, I wonder, can you share with us what kind of SaaS growth rates you'd anticipate as we enter 2025 with an increased implementation capacity, both internally and externally? You're sort of going SaaS in the mid-teens. Do you guys foresee 2025 to be materially higher in terms of SaaS growth with the new capacity? Great. great Then, I guess on your partner strategy, I wonder, can you share with us what kind of SaaS growth rates you'd anticipate as we enter 2025 with an increased implementation capacity, both internally and externally? then i guess on your partner strategy i wonder can you share with us what kind of saas growth rates you'd anticipate as we enter 2025 with an increased implementation capacity both internally and externally You're sort of going SaaS in the mid-teens. you're sort of going saas in the mid-teens Do you guys foresee 2025 to be materially higher in terms of SaaS growth with the new capacity? do you guys foresee 2025 to be materially higher in terms of saas growth with the new capacity

Speaker 9: Sujeet? Sujeet? sujeet

Speaker 7: Yeah. Good morning, Amr. So from a 2025 perspective, one of the comments I'll make is obviously working. Yeah. yeah Good morning, Amr. good morning amr So from a 2025 perspective, one of the comments I'll make is obviously working. so from a 2025 perspective one of the comments i'll make is obviously working

Speaker 6: Pardon me, Sujeet? Is your line muted? Pardon me, Sujeet? pardon me sujeet Is your line muted? is your line muted

Speaker 7: My apologies. Excuse me. My apologies. Can everybody hear me now? Amr, can you hear me? My apologies. my apologies Excuse me. excuse me My apologies. my apologies Can everybody hear me now? can everybody hear me now Amr, can you hear me? amr can you hear me

Speaker 8: Yes. Yes. Loud and clear. We missed all the good parts. Yes. yes Yes. yes Loud and clear. loud and clear We missed all the good parts. we missed all the good parts

Speaker 7: Yeah. No, my apologies. I was speaking into a muted mic when Bill was trying to get my attention. So to answer your question, Amr, I would look at it in terms of maintaining SaaS growth rates at the current rates. Since your question is more specific to the partner channel, certainly we do see lots of traction happening there. But just from a pure modeling perspective, I would view it as maintaining our SaaS recurring revenue growth in kind of the current range. And part of that also is in connection with there is, if you will, a certain lag between the bookings and the revenue. And essentially, maintaining the growth rate at current levels allows for that limited lag, if you will. And that's kind of how we're thinking about it within our shop. Yeah. yeah No, my apologies. no my apologies I was speaking into a muted mic when Bill was trying to get my attention. i was speaking into a muted mic when bill was trying to get my attention So to answer your question, Amr, I would look at it in terms of maintaining SaaS growth rates at the current rates. so to answer your question amr i would look at it in terms of maintaining saas growth rates at the current rates Since your question is more specific to the partner channel, certainly we do see lots of traction happening there. since your question is more specific to the partner channel certainly we do see lots of traction happening there But just from a pure modeling perspective, I would view it as maintaining our SaaS recurring revenue growth in kind of the current range. but just from a pure modeling perspective i would view it as maintaining our saas recurring revenue growth in kind of the current range And part of that also is in connection with there is, if you will, a certain lag between the bookings and the revenue. and part of that also is in connection with there is if you will a certain lag between the bookings and the revenue And essentially, maintaining the growth rate at current levels allows for that limited lag, if you will. and essentially maintaining the growth rate at current levels allows for that limited lag if you will And that's kind of how we're thinking about it within our shop. and that's kind of how we're thinking about it within our shop And like I said, we're at the moment looking through our pipeline in terms of the impacts on 2025 and how that would translate out into bookings and bookings into revenue. But my answer really would be to continue to maintain it in the range that it is right now. And like I said, we're at the moment looking through our pipeline in terms of the impacts on 2025 and how that would translate out into bookings and bookings into revenue. and like i said we're at the moment looking through our pipeline in terms of the impacts on 2025 and how that would translate out into bookings and bookings into revenue But my answer really would be to continue to maintain it in the range that it is right now. but my answer really would be to continue to maintain it in the range that it is right now

Speaker 8: Okay. I would have thought we'd see an inflection point given that you've got increased implementation capacity. At some point, we'd see SaaS grow from 15%-20-something% range. Okay. okay I would have thought we'd see an inflection point given that you've got increased implementation capacity. i would have thought we'd see an inflection point given that you've got increased implementation capacity At some point, we'd see SaaS grow from 15%-20-something% range. at some point we'd see saas grow from 15%-20-something% range

Speaker 7: The answer is yes. I mean, there will be an inflection that will happen. I think the more nuanced or the more of the refinement to that is pinpointing exactly when that inflection will happen, and that's sort of where I think we need to think through the fact that there is a little bit of a lag between bookings and revenue, and the inflection point has a lag effect compared to the actual booking happening. The answer is yes. the answer is yes I mean, there will be an inflection that will happen. i mean there will be an inflection that will happen I think the more nuanced or the more of the refinement to that is pinpointing exactly when that inflection will happen, and that's sort of where I think we need to think through the fact that there is a little bit of a lag between bookings and revenue, and the inflection point has a lag effect compared to the actual booking happening. i think the more nuanced or the more of the refinement to that is pinpointing exactly when that inflection will happen and that's sort of where i think we need to think through the fact that there is a little bit of a lag between bookings and revenue and the inflection point has a lag effect compared to the actual booking happening

Speaker 8: Understood. So it's happening, but it's hard to pinpoint when. That's great. Then maybe one last one. Any updates on SylogistPay that you guys can share with us? Understood. understood So it's happening, but it's hard to pinpoint when. so it's happening but it's hard to pinpoint when That's great. that's great Then maybe one last one. then maybe one last one Any updates on Sylogist Pay that you guys can share with us? any updates on sylogist pay that you guys can share with us

Speaker 9: Nothing in this quarter. We believe we'll have some updates in the coming periods, but nothing has materially changed from our belief that SylogistEd continues to be an integral part of our strategy as we monetize the transactions flowing through the platforms. And ultimately, as we see more of the mission gov, excuse me, SylogistGov activity and the transactions that flow through that platform within municipalities, we see strength there as well. But stay tuned. Nothing in this quarter. nothing in this quarter We believe we'll have some updates in the coming periods, but nothing has materially changed from our belief that SylogistEd continues to be an integral part of our strategy as we monetize the transactions flowing through the platforms. we believe we'll have some updates in the coming periods but nothing has materially changed from our belief that sylogisted continues to be an integral part of our strategy as we monetize the transactions flowing through the platforms And ultimately, as we see more of the mission gov, excuse me, SylogistGov activity and the transactions that flow through that platform within municipalities, we see strength there as well. and ultimately as we see more of the mission gov excuse me sylogistgov activity and the transactions that flow through that platform within municipalities we see strength there as well But stay tuned. but stay tuned

Speaker 8: Okay. Great. Thanks for taking my questions. Okay. okay Great. great Thanks for taking my questions. thanks for taking my questions

Speaker 9: Thanks, Amr. Thanks, Amr. thanks amr

Speaker 6: Our next question comes from Gavin Fairweather of Cormark. Please go ahead. Our next question comes from Gavin Fairweather of Cormark. our next question comes from gavin fairweather of cormark Please go ahead. please go ahead

Speaker 2: Oh, hey. Good morning. Thanks for taking my questions. Maybe just to start out, Bill, on the partner channel, can you refresh us on how many partners you're up to now? And I'm also curious kind of how mature that partner cohort is. Are they all kind of reaching the level of bookings and deal generation that you would expect, or are some of those still in the process of ramping? Oh, hey. oh hey Good morning. good morning Thanks for taking my questions. thanks for taking my questions Maybe just to start out, Bill, on the partner channel, can you refresh us on how many partners you're up to now? maybe just to start out bill on the partner channel can you refresh us on how many partners you're up to now And I'm also curious kind of how mature that partner cohort is. and i'm also curious kind of how mature that partner cohort is Are they all kind of reaching the level of bookings and deal generation that you would expect, or are some of those still in the process of ramping? are they all kind of reaching the level of bookings and deal generation that you would expect or are some of those still in the process of ramping

Speaker 9: We haven't given a specific number, but it is approximately 2x from where we were this time last year. It's fulsome in terms of the coverage we're looking for at this point. I would say a solid third to a half of those are now getting their legs underneath them, and we're moving into the phase where they're not shadowing us, but we're shadowing them in terms of implementations while the newer partners are more in the former part of going through the certification and training. So it's very pleasing to see the inbound activity we're seeing from the partner community who are anxious to be able to carry our flag. They have identified us as a leader for the specific solutions that they're looking for for their customer cohorts that are looking to upgrade. So we think the go-forward is very exciting as that community continues to build out. We haven't given a specific number, but it is approximately 2x from where we were this time last year. we haven't given a specific number but it is approximately 2x from where we were this time last year It's fulsome in terms of the coverage we're looking for at this point. it's fulsome in terms of the coverage we're looking for at this point I would say a solid third to a half of those are now getting their legs underneath them, and we're moving into the phase where they're not shadowing us, but we're shadowing them in terms of implementations while the newer partners are more in the former part of going through the certification and training. i would say a solid third to a half of those are now getting their legs underneath them and we're moving into the phase where they're not shadowing us but we're shadowing them in terms of implementations while the newer partners are more in the former part of going through the certification and training So it's very pleasing to see the inbound activity we're seeing from the partner community who are anxious to be able to carry our flag. so it's very pleasing to see the inbound activity we're seeing from the partner community who are anxious to be able to carry our flag They have identified us as a leader for the specific solutions that they're looking for for their customer cohorts that are looking to upgrade. they have identified us as a leader for the specific solutions that they're looking for for their customer cohorts that are looking to upgrade So we think the go-forward is very exciting as that community continues to build out. so we think the go-forward is very exciting as that community continues to build out But I would say about half of them are now flipping to the more partner-led versus in-house shadowing side, which is a great signal. But I would say about half of them are now flipping to the more partner-led versus in-house shadowing side, which is a great signal. but i would say about half of them are now flipping to the more partner-led versus in-house shadowing side which is a great signal

Speaker 2: Yeah. That's great to hear. That's great to hear. And then the KPIs you shared are super impressive in terms of the pipeline and the win rates that you're seeing. It strikes me as though you just need to see more deals. I mean, I'm curious what those metrics are telling you in terms of the need to invest in marketing and partner enablement and potentially a few more bodies in the direct sales force. Yeah. yeah That's great to hear. that's great to hear That's great to hear. that's great to hear And then the KPIs you shared are super impressive in terms of the pipeline and the win rates that you're seeing. and then the kpis you shared are super impressive in terms of the pipeline and the win rates that you're seeing It strikes me as though you just need to see more deals. it strikes me as though you just need to see more deals I mean, I'm curious what those metrics are telling you in terms of the need to invest in marketing and partner enablement and potentially a few more bodies in the direct sales force. i mean i'm curious what those metrics are telling you in terms of the need to invest in marketing and partner enablement and potentially a few more bodies in the direct sales force

Speaker 9: We agree. As we now have the motions reflected, we're not just throwing money into the wind. We do believe as we look at enabling the partner community to be able to bring us into deals as well as us being able to activate deals ourselves, we see the ability to now get even more efficiency out of our marketing motions, and as well as our customer referrals are starting to become more meaningful as our pod of gov and ed customers expand. We were starting from relatively a very small base and ultimately wanted to make sure that would progress in a thoughtful way before we got out over our skis of more people knocking on the door that we could accommodate, but we're now through that gate, and we feel that there's so the scalability portion we feel very good about. We agree. we agree As we now have the motions reflected, we're not just throwing money into the wind. as we now have the motions reflected we're not just throwing money into the wind We do believe as we look at enabling the partner community to be able to bring us into deals as well as us being able to activate deals ourselves, we see the ability to now get even more efficiency out of our marketing motions, and as well as our customer referrals are starting to become more meaningful as our pod of gov and ed customers expand. we do believe as we look at enabling the partner community to be able to bring us into deals as well as us being able to activate deals ourselves we see the ability to now get even more efficiency out of our marketing motions and as well as our customer referrals are starting to become more meaningful as our pod of gov and ed customers expand We were starting from relatively a very small base and ultimately wanted to make sure that would progress in a thoughtful way before we got out over our skis of more people knocking on the door that we could accommodate, but we're now through that gate, and we feel that there's so the scalability portion we feel very good about. we were starting from relatively a very small base and ultimately wanted to make sure that would progress in a thoughtful way before we got out over our skis of more people knocking on the door that we could accommodate but we're now through that gate and we feel that there's so the scalability portion we feel very good about And now that's really being supplemented by the idea of our pipeline is growing with more balance and really materially year-over-year. We feel good about what growth can occur in the coming quarters in terms of just the bookings. And now that's really being supplemented by the idea of our pipeline is growing with more balance and really materially year-over-year. and now that's really being supplemented by the idea of our pipeline is growing with more balance and really materially year-over-year We feel good about what growth can occur in the coming quarters in terms of just the bookings. we feel good about what growth can occur in the coming quarters in terms of just the bookings

Speaker 2: Appreciate the color. And then just on Gov, I know you've transitioned some customers onto the new SaaS platform, and partners are increasingly working with it on deals. Can you just provide a bit of color on the feedback that you're getting from that existing customer cohort that's moved over and the partners that are increasingly looking to sell it? And how is that kind of influencing your view on the growth prospects for that platform going forward? Appreciate the color. appreciate the color And then just on Gov, I know you've transitioned some customers onto the new SaaS platform, and partners are increasingly working with it on deals. and then just on gov i know you've transitioned some customers onto the new saas platform and partners are increasingly working with it on deals Can you just provide a bit of color on the feedback that you're getting from that existing customer cohort that's moved over and the partners that are increasingly looking to sell it? can you just provide a bit of color on the feedback that you're getting from that existing customer cohort that's moved over and the partners that are increasingly looking to sell it And how is that kind of influencing your view on the growth prospects for that platform going forward? and how is that kind of influencing your view on the growth prospects for that platform going forward

Speaker 9: From the customer side, they're delighted. They were able to transition from a standpoint of core business functions and now empowered with a fully SaaS platform. The prospective customers, the RFPs that are out there, we see almost an open arm kind of welcome. Thank goodness you're here because there really has been a void of new technology for the segment that we're aimed at. So the RFP activity is very strong. The desire for the Microsoft-based platform is very strong. We're well-positioned, obviously, and uniquely positioned there. So we're quite bullish on the gov sector in terms of an accelerator for us as we think about the go-forward and as we expand the footprint not only east to west in Canada, but into North America overall. So partners will be a big part of that. That is 100% partner-driven. From the customer side, they're delighted. from the customer side they're delighted They were able to transition from a standpoint of core business functions and now empowered with a fully SaaS platform. they were able to transition from a standpoint of core business functions and now empowered with a fully saas platform The prospective customers, the RFPs that are out there, we see almost an open arm kind of welcome. the prospective customers the rfps that are out there we see almost an open arm kind of welcome Thank goodness you're here because there really has been a void of new technology for the segment that we're aimed at. thank goodness you're here because there really has been a void of new technology for the segment that we're aimed at So the RFP activity is very strong. so the rfp activity is very strong The desire for the Microsoft-based platform is very strong. the desire for the microsoft-based platform is very strong We're well-positioned, obviously, and uniquely positioned there. we're well-positioned obviously and uniquely positioned there So we're quite bullish on the gov sector in terms of an accelerator for us as we think about the go-forward and as we expand the footprint not only east to west in Canada, but into North America overall. so we're quite bullish on the gov sector in terms of an accelerator for us as we think about the go-forward and as we expand the footprint not only east to west in canada but into north america overall So partners will be a big part of that. so partners will be a big part of that That is 100% partner-driven. that is 100% partner-driven They have cohorts of Great Plains customers and so on that they've been looking for a solution to be able to fit the needs and budgets of customers that really hasn't existed for some time. We're very excited about the gov sector overall, and we think we're now in a very good position to accelerate in that space. They have cohorts of Great Plains customers and so on that they've been looking for a solution to be able to fit the needs and budgets of customers that really hasn't existed for some time. they have cohorts of great plains customers and so on that they've been looking for a solution to be able to fit the needs and budgets of customers that really hasn't existed for some time We're very excited about the gov sector overall, and we think we're now in a very good position to accelerate in that space. we're very excited about the gov sector overall and we think we're now in a very good position to accelerate in that space

Speaker 2: Great. That's it for me. I'll pass along. Thanks so much. Great. great That's it for me. that's it for me I'll pass along. i'll pass along Thanks so much. thanks so much

Speaker 6: The next question comes from Suthan Sukumar of Stifel Canada. Please go ahead. The next question comes from Suthan Sukumar of Stifel Canada. the next question comes from suthan sukumar of stifel canada Please go ahead. please go ahead

Speaker 5: Good morning, gents. Congrats on a solid print. For my first question, I wanted to just touch on your go-to-market success to date. It's really good to hear that competitive placements are sustaining well. But just kind of curious, how much of your go-to-market success to date has been driven from greenfield opportunities, meaning going after that segment of the market that has yet to adopt any meaningful technology? Good morning, gents. good morning gents Congrats on a solid print. congrats on a solid print For my first question, I wanted to just touch on your go-to-market success to date. for my first question i wanted to just touch on your go-to-market success to date It's really good to hear that competitive placements are sustaining well. it's really good to hear that competitive placements are sustaining well But just kind of curious, how much of your go-to-market success to date has been driven from greenfield opportunities, meaning going after that segment of the market that has yet to adopt any meaningful technology? but just kind of curious how much of your go-to-market success to date has been driven from greenfield opportunities meaning going after that segment of the market that has yet to adopt any meaningful technology

Speaker 9: Good morning, Suthan. That segment, just greenfield, is quite small. The technology may be really dated, which is very common in the ed and gov, and frankly, a little less so on the mission sector. But most everyone is coming off of an existing system of some sort. As I said, it could be maybe in place for decades. The key, and I'll give you a sense of displacement and our displacement strategy, almost 75% of our bookings in this quarter were with targeted competitor displacements. So that really gives you a sense of, A, our focus, the efficiency that we're bringing to those motions, the activity that's going on within those cohort communities that now have visibility to us as a viable and exciting alternative. And so I would say that the motions around our targeted displacement shouldn't be taken as a small pond. Good morning, Suthan. good morning suthan That segment, just greenfield, is quite small. that segment just greenfield is quite small The technology may be really dated, which is very common in the ed and gov, and frankly, a little less so on the mission sector. the technology may be really dated which is very common in the ed and gov and frankly a little less so on the mission sector But most everyone is coming off of an existing system of some sort. but most everyone is coming off of an existing system of some sort As I said, it could be maybe in place for decades. as i said it could be maybe in place for decades The key, and I'll give you a sense of displacement and our displacement strategy, almost 75% of our bookings in this quarter were with targeted competitor displacements. the key and i'll give you a sense of displacement and our displacement strategy almost 75% of our bookings in this quarter were with targeted competitor displacements So that really gives you a sense of, A, our focus, the efficiency that we're bringing to those motions, the activity that's going on within those cohort communities that now have visibility to us as a viable and exciting alternative. so that really gives you a sense of a our focus the efficiency that we're bringing to those motions the activity that's going on within those cohort communities that now have visibility to us as a viable and exciting alternative And so I would say that the motions around our targeted displacement shouldn't be taken as a small pond. and so i would say that the motions around our targeted displacement shouldn't be taken as a small pond It's a very, very large ocean of opportunity. We're just focused on those where we can win at a very high rate and have good efficiency to lead to happy customers. It's a very, very large ocean of opportunity. it's a very very large ocean of opportunity We're just focused on those where we can win at a very high rate and have good efficiency to lead to happy customers. we're just focused on those where we can win at a very high rate and have good efficiency to lead to happy customers

Speaker 5: Great. Fantastic. My second question, Bill, is really around the education vertical. Can you talk a little bit about the strength that you're seeing there? I think following last quarter, I may have been maybe incorrectly anticipating a little bit of normalization in the pace of bookings growth and how that translates to revenue growth. But it looks like the strength is continuing. Can you talk about some of the factors for the success underlying the strength there? Great. great Fantastic. fantastic My second question, Bill, is really around the education vertical. my second question bill is really around the education vertical Can you talk a little bit about the strength that you're seeing there? can you talk a little bit about the strength that you're seeing there I think following last quarter, I may have been maybe incorrectly anticipating a little bit of normalization in the pace of bookings growth and how that translates to revenue growth. i think following last quarter i may have been maybe incorrectly anticipating a little bit of normalization in the pace of bookings growth and how that translates to revenue growth But it looks like the strength is continuing. but it looks like the strength is continuing Can you talk about some of the factors for the success underlying the strength there? can you talk about some of the factors for the success underlying the strength there

Speaker 9: It is the validation of our lift and shift of the technology that we acquired in Oklahoma that was specific to Oklahoma and now successfully lifting and shifting that to North Carolina, lighting up customers, existing as well as new, on that platform, and then the permeation of that out to other school districts that have been looking for a solution and are unhappy with their existing. And that also has been our springboard as we think about 2025 and beyond into targeted other states. So it really is you got to earn your stripes in a new state, if you will. There's covenants related to what the idiosyncrasies are. But from a software standpoint now, we've taken all the hardwiring out that was specific to Oklahoma. It is the validation of our lift and shift of the technology that we acquired in Oklahoma that was specific to Oklahoma and now successfully lifting and shifting that to North Carolina, lighting up customers, existing as well as new, on that platform, and then the permeation of that out to other school districts that have been looking for a solution and are unhappy with their existing. it is the validation of our lift and shift of the technology that we acquired in oklahoma that was specific to oklahoma and now successfully lifting and shifting that to north carolina lighting up customers existing as well as new on that platform and then the permeation of that out to other school districts that have been looking for a solution and are unhappy with their existing And that also has been our springboard as we think about 2025 and beyond into targeted other states. and that also has been our springboard as we think about 2025 and beyond into targeted other states So it really is you got to earn your stripes in a new state, if you will. so it really is you got to earn your stripes in a new state if you will There's covenants related to what the idiosyncrasies are. there's covenants related to what the idiosyncrasies are But from a software standpoint now, we've taken all the hardwiring out that was specific to Oklahoma. but from a software standpoint now we've taken all the hardwiring out that was specific to oklahoma And now, any state that we move forward, it was validated in North Carolina, we can handle the nuances of state idiosyncrasies without any change to the software itself. It's more setup-related, so it now gives us the ability to think about scale differently than we had thought of it before when we were first needing to validate that what we believed was true is now proving out to be so. And now, any state that we move forward, it was validated in North Carolina, we can handle the nuances of state idiosyncrasies without any change to the software itself. and now any state that we move forward it was validated in north carolina we can handle the nuances of state idiosyncrasies without any change to the software itself It's more setup-related, so it now gives us the ability to think about scale differently than we had thought of it before when we were first needing to validate that what we believed was true is now proving out to be so. it's more setup-related so it now gives us the ability to think about scale differently than we had thought of it before when we were first needing to validate that what we believed was true is now proving out to be so

Speaker 5: Excellent. And on the government segment, it's good to hear you're quite bullish on the opportunity there and really the opportunity to expand across North America. Can you speak a little bit about the strategy to protect your existing base, I guess, from a migration standpoint? And just a reminder of what are the key levers here to drive organic growth in the government segment? Excellent. excellent And on the government segment, it's good to hear you're quite bullish on the opportunity there and really the opportunity to expand across North America. and on the government segment it's good to hear you're quite bullish on the opportunity there and really the opportunity to expand across north america Can you speak a little bit about the strategy to protect your existing base, I guess, from a migration standpoint? can you speak a little bit about the strategy to protect your existing base i guess from a migration standpoint And just a reminder of what are the key levers here to drive organic growth in the government segment? and just a reminder of what are the key levers here to drive organic growth in the government segment

Speaker 9: The moat for protecting existing customers is largely there's few to no real viable alternatives, if you will, that meets the sophistication as well as the contemporary posture, security posture of the platform, such as SylogistGov. We're in a very good place now in terms of our ability to demonstrate to partners that we have not just a solution on the come, but something that now is working in cities and towns that they can spin up on and take to their cohorts of customers to say, "We have something that you really need to look at." We also have now created visibility through technology and AI where we can go out and across North America track all of the RFPs that are going on within the gov sector. The moat for protecting existing customers is largely there's few to no real viable alternatives, if you will, that meets the sophistication as well as the contemporary posture, security posture of the platform, such as SylogistGov. the moat for protecting existing customers is largely there's few to no real viable alternatives if you will that meets the sophistication as well as the contemporary posture security posture of the platform such as sylogistgov We're in a very good place now in terms of our ability to demonstrate to partners that we have not just a solution on the come, but something that now is working in cities and towns that they can spin up on and take to their cohorts of customers to say, "We have something that you really need to look at." We also have now created visibility through technology and AI where we can go out and across North America track all of the RFPs that are going on within the gov sector. we're in a very good place now in terms of our ability to demonstrate to partners that we have not just a solution on the come but something that now is working in cities and towns that they can spin up on and take to their cohorts of customers to say "we have something that you really need to look at." we also have now created visibility through technology and ai where we can go out and across north america track all of the rfps that are going on within the gov sector And that gives us a real good sense of timing of what our pipeline should look like, where we're pointing, and where partners are already spending their efforts. So we are sharing that platform and that data with them so that we're making sure that we're aware of opportunities that are on the horizon and are in the queue to make sure that either we're part of that bidding process. But even more importantly, some of them and many of them, and it's increasing, we can get out to a sole source provider scenario so they don't go out to or aren't forced to go out to a bid procurement because we have unique technology, the Microsoft platform built on Business Central, that if their needs and desires are of that ilk, they can come in and look at us as a sole source provider. And that gives us a real good sense of timing of what our pipeline should look like, where we're pointing, and where partners are already spending their efforts. and that gives us a real good sense of timing of what our pipeline should look like where we're pointing and where partners are already spending their efforts So we are sharing that platform and that data with them so that we're making sure that we're aware of opportunities that are on the horizon and are in the queue to make sure that either we're part of that bidding process. so we are sharing that platform and that data with them so that we're making sure that we're aware of opportunities that are on the horizon and are in the queue to make sure that either we're part of that bidding process But even more importantly, some of them and many of them, and it's increasing, we can get out to a sole source provider scenario so they don't go out to or aren't forced to go out to a bid procurement because we have unique technology, the Microsoft platform built on Business Central, that if their needs and desires are of that ilk, they can come in and look at us as a sole source provider. but even more importantly some of them and many of them and it's increasing we can get out to a sole source provider scenario so they don't go out to or aren't forced to go out to a bid procurement because we have unique technology the microsoft platform built on business central that if their needs and desires are of that ilk they can come in and look at us as a sole source provider So that really shrinks the sales cycle as well. So we're all systems go on the gov side at this point, and our partners are really enthused. And they're actually adding people to better assess the data that's coming into them to be able to get their kind of attack mode of go-to-market using our platform ramped up. So that really shrinks the sales cycle as well. so that really shrinks the sales cycle as well So we're all systems go on the gov side at this point, and our partners are really enthused. so we're all systems go on the gov side at this point and our partners are really enthused And they're actually adding people to better assess the data that's coming into them to be able to get their kind of attack mode of go-to-market using our platform ramped up. and they're actually adding people to better assess the data that's coming into them to be able to get their kind of attack mode of go-to-market using our platform ramped up

Speaker 5: Okay. Great. That's good color. Last one for me, guys, is just on Microsoft. Can you provide a quick update on how this relationship is evolving and what was the level of contribution to bookings and pipeline this quarter? And what do you expect in the course ahead? Okay. okay Great. great That's good color. that's good color Last one for me, guys, is just on Microsoft. last one for me guys is just on microsoft Can you provide a quick update on how this relationship is evolving and what was the level of contribution to bookings and pipeline this quarter? can you provide a quick update on how this relationship is evolving and what was the level of contribution to bookings and pipeline this quarter And what do you expect in the course ahead? and what do you expect in the course ahead

Speaker 9: I'll take kind of the business side of it. We feel really good about our commitment to the Business Central platform and the Dynamics 365 CRM platform. We get so many advantages vis-à-vis our competitors on the AI front, on the security posture front, on the cloud scalability front. And it's what our customers and what prospective customers are looking for. Microsoft is becoming almost a de facto kind of platform of choice or provider of choice within the segments that we serve in the public sector. So that's a great tailwind for us relative to Microsoft as a partner. I'll take kind of the business side of it. i'll take kind of the business side of it We feel really good about our commitment to the Business Central platform and the Dynamics 365 CRM platform. we feel really good about our commitment to the business central platform and the dynamics 365 crm platform We get so many advantages vis-à-vis our competitors on the AI front, on the security posture front, on the cloud scalability front. we get so many advantages vis-à-vis our competitors on the ai front on the security posture front on the cloud scalability front And it's what our customers and what prospective customers are looking for. and it's what our customers and what prospective customers are looking for Microsoft is becoming almost a de facto kind of platform of choice or provider of choice within the segments that we serve in the public sector. microsoft is becoming almost a de facto kind of platform of choice or provider of choice within the segments that we serve in the public sector So that's a great tailwind for us relative to Microsoft as a partner. so that's a great tailwind for us relative to microsoft as a partner We're also now having a couple of years of engagement and through Grant McLaren's efforts and his deep experience with Microsoft as managing it from KPMG to Microsoft previously. We really expanded how we work with one another and make sure that we are aligned in our marketing efforts and how they think about their go-to-market in terms of the public sector and really showcase us as a premier partner for that side. They're horizontally oriented, so they're very reliant on vertical partners like us to be able to deliver their technology, sell their SaaS subscriptions, but with the vertical additions that we add to their horizontal solutions. So we feel good about it, really good about it on the acceleration side and maintaining and containing our R&D spend going forward. Anything on the financial side you want to add there, Sujeet? We're also now having a couple of years of engagement and through Grant McLaren's efforts and his deep experience with Microsoft as managing it from KPMG to Microsoft previously. we're also now having a couple of years of engagement and through grant mclaren's efforts and his deep experience with microsoft as managing it from kpmg to microsoft previously We really expanded how we work with one another and make sure that we are aligned in our marketing efforts and how they think about their go-to-market in terms of the public sector and really showcase us as a premier partner for that side. we really expanded how we work with one another and make sure that we are aligned in our marketing efforts and how they think about their go-to-market in terms of the public sector and really showcase us as a premier partner for that side They're horizontally oriented, so they're very reliant on vertical partners like us to be able to deliver their technology, sell their SaaS subscriptions, but with the vertical additions that we add to their horizontal solutions. they're horizontally oriented so they're very reliant on vertical partners like us to be able to deliver their technology sell their saas subscriptions but with the vertical additions that we add to their horizontal solutions So we feel good about it, really good about it on the acceleration side and maintaining and containing our R&D spend going forward. so we feel good about it really good about it on the acceleration side and maintaining and containing our r&d spend going forward Anything on the financial side you want to add there, Sujeet? anything on the financial side you want to add there sujeet

Speaker 7: No, Bill. And Suthan, good morning. I don't believe in, I don't recall us having talked about the financial impacts of the Microsoft relationship either on the booking side or on the cost side. But again, I will reiterate the huge, huge advantage of that relationship is obviously on the R&D side. And kind of on the business side, it's that ability to leverage off the relationship and more often than not actually get walked into deals because of the Microsoft relationship. But we don't share numbers-related details in terms of bookings attributed, if you will, to Microsoft or anything on those lines. No, Bill. no bill And Suthan, good morning. and suthan good morning I don't believe in, I don't recall us having talked about the financial impacts of the Microsoft relationship either on the booking side or on the cost side. i don't believe in i don't recall us having talked about the financial impacts of the microsoft relationship either on the booking side or on the cost side But again, I will reiterate the huge, huge advantage of that relationship is obviously on the R&D side. but again i will reiterate the huge huge advantage of that relationship is obviously on the r&d side And kind of on the business side, it's that ability to leverage off the relationship and more often than not actually get walked into deals because of the Microsoft relationship. and kind of on the business side it's that ability to leverage off the relationship and more often than not actually get walked into deals because of the microsoft relationship But we don't share numbers-related details in terms of bookings attributed, if you will, to Microsoft or anything on those lines. but we don't share numbers-related details in terms of bookings attributed if you will to microsoft or anything on those lines

Speaker 5: Thank you, Sujeet. Thank you, gents. Great update. Thanks for taking my questions. I'll pass the line. Thank you, Sujeet. thank you sujeet Thank you, gents. thank you gents Great update. great update Thanks for taking my questions. thanks for taking my questions I'll pass the line. i'll pass the line

Speaker 6: Our next question comes from Daniel Rosenberg of Paradigm Capital. Please go ahead. Our next question comes from Daniel Rosenberg of Paradigm Capital. our next question comes from daniel rosenberg of paradigm capital Please go ahead. please go ahead

Speaker 4: Hi. Good morning, Bill and Sujeet. My first question was around the partner channel. And so I think you mentioned doubling the number of partners since last year, which is quite a positive to see. I was wondering, going forward, if you think bookings is it about going deeper with these partners, or do you plan on expanding again? That number was just, yeah, doubling is quite significant. So just curious about any details there. Hi. hi Good morning, Bill and Sujeet. good morning bill and sujeet My first question was around the partner channel. my first question was around the partner channel And so I think you mentioned doubling the number of partners since last year, which is quite a positive to see. and so i think you mentioned doubling the number of partners since last year which is quite a positive to see I was wondering, going forward, if you think bookings is it about going deeper with these partners, or do you plan on expanding again? i was wondering going forward if you think bookings is it about going deeper with these partners or do you plan on expanding again That number was just, yeah, doubling is quite significant. that number was just yeah doubling is quite significant So just curious about any details there. so just curious about any details there

Speaker 9: Good morning, Daniel. As I said earlier, we have a lot of inbound from Microsoft-certified Business Central and others that are well-known names across North America, firms with IT consulting, digital transformation, and specifically financial practices on the consulting side and implementation for the public sector. If they have a Microsoft orientation as a partner, and that's really our segment, and many of them have also moved to that platform for the reasons I said before, it's what people want. We do see that partner community expanding. We're not doing it at, "Hey, we're open for business. Anybody want to sign up?" It's not our mode because we really want to make sure their commitment to the effectiveness of the implementation and the long-term partnership is sincere. Good morning, Daniel. good morning daniel As I said earlier, we have a lot of inbound from Microsoft-certified Business Central and others that are well-known names across North America, firms with IT consulting, digital transformation, and specifically financial practices on the consulting side and implementation for the public sector. as i said earlier we have a lot of inbound from microsoft-certified business central and others that are well-known names across north america firms with it consulting digital transformation and specifically financial practices on the consulting side and implementation for the public sector If they have a Microsoft orientation as a partner, and that's really our segment, and many of them have also moved to that platform for the reasons I said before, it's what people want. if they have a microsoft orientation as a partner and that's really our segment and many of them have also moved to that platform for the reasons i said before it's what people want We do see that partner community expanding. we do see that partner community expanding We're not doing it at, "Hey, we're open for business. we're not doing it at "hey we're open for business Anybody want to sign up?" It's not our mode because we really want to make sure their commitment to the effectiveness of the implementation and the long-term partnership is sincere. anybody want to sign up?" it's not our mode because we really want to make sure their commitment to the effectiveness of the implementation and the long-term partnership is sincere And so I don't mean to say that they're coming to us with false pretense, but the reality is we want to peel back and make sure that they have their sustainable partners. Partners coming in and out is a costly proposition for us as we think about the go-forward. There's a lot of them, Daniel, that are knocking on our door that we're in discussions with now, and we are in a good position to be able to kind of select which ones fit well for us. But also, we're very appreciative of the additive aspect of what they bring to our team, particularly visibility and girth. Many of them have really mature programs in the public sector and deep customer relationships that are really benefiting us as we start to win more deals and they put us on more deals. So it's very positive. And so I don't mean to say that they're coming to us with false pretense, but the reality is we want to peel back and make sure that they have their sustainable partners. and so i don't mean to say that they're coming to us with false pretense but the reality is we want to peel back and make sure that they have their sustainable partners Partners coming in and out is a costly proposition for us as we think about the go-forward. partners coming in and out is a costly proposition for us as we think about the go-forward There's a lot of them, Daniel, that are knocking on our door that we're in discussions with now, and we are in a good position to be able to kind of select which ones fit well for us. there's a lot of them daniel that are knocking on our door that we're in discussions with now and we are in a good position to be able to kind of select which ones fit well for us But also, we're very appreciative of the additive aspect of what they bring to our team, particularly visibility and girth. but also we're very appreciative of the additive aspect of what they bring to our team particularly visibility and girth Many of them have really mature programs in the public sector and deep customer relationships that are really benefiting us as we start to win more deals and they put us on more deals. many of them have really mature programs in the public sector and deep customer relationships that are really benefiting us as we start to win more deals and they put us on more deals So it's very positive. so it's very positive We see it building as we go forward. And undoubtedly, I think they will go deeper with us. And I think we will also add partners in count without question. We see it building as we go forward. we see it building as we go forward And undoubtedly, I think they will go deeper with us. and undoubtedly i think they will go deeper with us And I think we will also add partners in count without question. and i think we will also add partners in count without question

Speaker 4: Okay. Thanks for that. I was also curious about the displacement that you spoke of. I was wondering, what is that balance between the local solution or smaller players versus some of the larger incumbents? Is that any of that displacement coming from the big guys today? And do you see that changing as you look to the future? Okay. okay Thanks for that. thanks for that I was also curious about the displacement that you spoke of. i was also curious about the displacement that you spoke of I was wondering, what is that balance between the local solution or smaller players versus some of the larger incumbents? i was wondering what is that balance between the local solution or smaller players versus some of the larger incumbents Is that any of that displacement coming from the big guys today? is that any of that displacement coming from the big guys today And do you see that changing as you look to the future? and do you see that changing as you look to the future

Speaker 9: I have to pause. Big guys is relative in terms of who that could fit. I will say that our displacement strategy is not kind of one that's focused on down market. We are very much focused on our ICP, and the displacement is very much associated with our ideal customer profile in each of the segments that we're working on, so no, we're not seeing any deal deflation in terms of our overall booking size whatsoever, and we're actually seeing some expansion there, so I would say in certain markets, we are very much displacing the big guy, if you will, or big guys, if you will. Others in the gov side, we're never going to be a replacement for some of the high-end SAP kind of solutions that really compete for those uber large cities. That's not our ideal customer profile. I have to pause. i have to pause Big guys is relative in terms of who that could fit. big guys is relative in terms of who that could fit I will say that our displacement strategy is not kind of one that's focused on down market. i will say that our displacement strategy is not kind of one that's focused on down market We are very much focused on our ICP, and the displacement is very much associated with our ideal customer profile in each of the segments that we're working on, so no, we're not seeing any deal deflation in terms of our overall booking size whatsoever, and we're actually seeing some expansion there, so I would say in certain markets, we are very much displacing the big guy, if you will, or big guys, if you will. we are very much focused on our icp and the displacement is very much associated with our ideal customer profile in each of the segments that we're working on so no we're not seeing any deal deflation in terms of our overall booking size whatsoever and we're actually seeing some expansion there so i would say in certain markets we are very much displacing the big guy if you will or big guys if you will Others in the gov side, we're never going to be a replacement for some of the high-end SAP kind of solutions that really compete for those uber large cities. others in the gov side we're never going to be a replacement for some of the high-end sap kind of solutions that really compete for those uber large cities That's not our ideal customer profile. that's not our ideal customer profile I wouldn't measure ourselves against the large deal. What we are seeing is really good, strong deal value continuing and growing as we think about not only the initial install, but the upsell and cross-sell as they use a platform more, bring on more users, and bring on more functionality. I wouldn't measure ourselves against the large deal. i wouldn't measure ourselves against the large deal What we are seeing is really good, strong deal value continuing and growing as we think about not only the initial install, but the upsell and cross-sell as they use a platform more, bring on more users, and bring on more functionality. what we are seeing is really good strong deal value continuing and growing as we think about not only the initial install but the upsell and cross-sell as they use a platform more bring on more users and bring on more functionality

Speaker 4: Okay. Thanks for that and then my last question is just around M&A. You mentioned the success of Mission, or you provided some data around the success that you've had. I was wondering how you guys are thinking about the M&A market today, any opportunities or challenges when you look at what's out there as it relates to Sylogist? Okay. okay Thanks for that and then my last question is just around M&A. thanks for that and then my last question is just around m&a You mentioned the success of Mission, or you provided some data around the success that you've had. you mentioned the success of mission or you provided some data around the success that you've had I was wondering how you guys are thinking about the M&A market today, any opportunities or challenges when you look at what's out there as it relates to Sylogist? i was wondering how you guys are thinking about the m&a market today any opportunities or challenges when you look at what's out there as it relates to sylogist

Speaker 9: Yeah. Our appetite has not changed. We continue to make sure that we're not adding burden to ourselves that doesn't make sense, a lift that doesn't make sense. There are continuing targets. We continue to have both direct outreach on an ongoing basis as well as through many partners that bring us possibilities as well. We have a strong appetite. We continue to look at a credit facility that allows us to execute on deals if they make sense. We haven't seen a lot of the deal values come down. Overall, we still feel that good assets are demanding or getting a lot of activity if they do come to market in a more public process. We continue to look at opportunities that may not be yet in a process and provide a compelling case as to why preemptively we would be a good buyer. Yeah. yeah Our appetite has not changed. our appetite has not changed We continue to make sure that we're not adding burden to ourselves that doesn't make sense, a lift that doesn't make sense. we continue to make sure that we're not adding burden to ourselves that doesn't make sense a lift that doesn't make sense There are continuing targets. there are continuing targets We continue to have both direct outreach on an ongoing basis as well as through many partners that bring us possibilities as well. we continue to have both direct outreach on an ongoing basis as well as through many partners that bring us possibilities as well We have a strong appetite. we have a strong appetite We continue to look at a credit facility that allows us to execute on deals if they make sense. we continue to look at a credit facility that allows us to execute on deals if they make sense We haven't seen a lot of the deal values come down. we haven't seen a lot of the deal values come down Overall, we still feel that good assets are demanding or getting a lot of activity if they do come to market in a more public process. overall we still feel that good assets are demanding or getting a lot of activity if they do come to market in a more public process We continue to look at opportunities that may not be yet in a process and provide a compelling case as to why preemptively we would be a good buyer. we continue to look at opportunities that may not be yet in a process and provide a compelling case as to why preemptively we would be a good buyer We're very much on that hunt, Daniel. We just, over the last few quarters, haven't been able to bring across something that we thought made sense for our value creation problem. We're very much on that hunt, Daniel. we're very much on that hunt daniel We just, over the last few quarters, haven't been able to bring across something that we thought made sense for our value creation problem. we just over the last few quarters haven't been able to bring across something that we thought made sense for our value creation problem

Speaker 4: Thank you. I'll pass the line. Thank you. thank you I'll pass the line. i'll pass the line

Speaker 6: Our next question comes from Adam Wilk of Greystone Capital Management. Please go ahead. Our next question comes from Adam Wilk of Greystone Capital Management. our next question comes from adam wilk of greystone capital management Please go ahead. please go ahead

Speaker 1: Hi. Good morning. Thanks for taking my questions. You guys had, there's been a lot of focus on the sort of inflection of SaaS revenue growth in the near term and I guess over time. But you had previously mentioned the sort of balance of your internal capabilities and resources, making sure that the customers are taken care of rather than just plowing forward with as much growth as possible. Do you still feel like that remains the case in terms of where you sit today? Or can we just get an update on that sort of, I guess, bottleneck, my word, not yours, in terms of where that sits today? Hi. hi Good morning. good morning Thanks for taking my questions. thanks for taking my questions You guys had, there's been a lot of focus on the sort of inflection of SaaS revenue growth in the near term and I guess over time. you guys had there's been a lot of focus on the sort of inflection of saas revenue growth in the near term and i guess over time But you had previously mentioned the sort of balance of your internal capabilities and resources, making sure that the customers are taken care of rather than just plowing forward with as much growth as possible. but you had previously mentioned the sort of balance of your internal capabilities and resources making sure that the customers are taken care of rather than just plowing forward with as much growth as possible Do you still feel like that remains the case in terms of where you sit today? do you still feel like that remains the case in terms of where you sit today Or can we just get an update on that sort of, I guess, bottleneck, my word, not yours, in terms of where that sits today? or can we just get an update on that sort of i guess bottleneck my word not yours in terms of where that sits today

Speaker 9: Hey, Adam. Good morning. Yeah, great question. And I think it's kind of somewhat of an adaptation of a prior one. We do see, undoubtedly, SaaS ARR revenue growth increasing. We're just trying to make sure that through mid-2025, we're not overstating what we believe is possible, but our capacity is growing both in terms of our direct and indirect. The efficacy is sky-high and our ability to have greater implementation capacity with partners now being able to stand on their own two feet and deliver that. So that allows us to get to SaaS ARR more quickly and through implementations with a high degree of success. So I would say that we are coming out of the bottleneck. We're still considered the success to be precious. Hey, Adam. hey adam Good morning. good morning Yeah, great question. yeah great question And I think it's kind of somewhat of an adaptation of a prior one. and i think it's kind of somewhat of an adaptation of a prior one We do see, undoubtedly, SaaS ARR revenue growth increasing. we do see undoubtedly saas arr revenue growth increasing We're just trying to make sure that through mid-2025, we're not overstating what we believe is possible, but our capacity is growing both in terms of our direct and indirect. we're just trying to make sure that through mid-2025 we're not overstating what we believe is possible but our capacity is growing both in terms of our direct and indirect The efficacy is sky-high and our ability to have greater implementation capacity with partners now being able to stand on their own two feet and deliver that. the efficacy is sky-high and our ability to have greater implementation capacity with partners now being able to stand on their own two feet and deliver that So that allows us to get to SaaS ARR more quickly and through implementations with a high degree of success. so that allows us to get to saas arr more quickly and through implementations with a high degree of success So I would say that we are coming out of the bottleneck. so i would say that we are coming out of the bottleneck We're still considered the success to be precious. we're still considered the success to be precious We're not necessarily just saying, "Come one, come all," but we're now in a mode where we have clear visibility to greater capacity both on the booking side and in all three markets, whereas we were kind of a single-piston machine before. So I will generally say that in the back half of 2025, we see, and I tried to speak to that in my opening comments, that we see strengthening, acceleration, and leverage as we get into the back half of 2025. We're not necessarily just saying, "Come one, come all," but we're now in a mode where we have clear visibility to greater capacity both on the booking side and in all three markets, whereas we were kind of a single-piston machine before. we're not necessarily just saying "come one come all," but we're now in a mode where we have clear visibility to greater capacity both on the booking side and in all three markets whereas we were kind of a single-piston machine before So I will generally say that in the back half of 2025, we see, and I tried to speak to that in my opening comments, that we see strengthening, acceleration, and leverage as we get into the back half of 2025. so i will generally say that in the back half of 2025 we see and i tried to speak to that in my opening comments that we see strengthening acceleration and leverage as we get into the back half of 2025

Speaker 1: Okay. Excellent. And then just an update on capital allocation and priorities would be great. I know a previous caller asked about M&A, and maybe I'll just add, if there was a deal that made sense for you guys, could you just talk about what that might look like in terms of would it be, are you more focused on the product side, geography, type of customer? Would just love to get your thoughts on that. Thanks. Okay. okay Excellent. excellent And then just an update on capital allocation and priorities would be great. and then just an update on capital allocation and priorities would be great I know a previous caller asked about M&A, and maybe I'll just add, if there was a deal that made sense for you guys, could you just talk about what that might look like in terms of would it be, are you more focused on the product side, geography, type of customer? i know a previous caller asked about m&a and maybe i'll just add if there was a deal that made sense for you guys could you just talk about what that might look like in terms of would it be are you more focused on the product side geography type of customer Would just love to get your thoughts on that. would just love to get your thoughts on that Thanks. thanks

Speaker 9: Sure. It really does continue to be consistent with where we were previously. We will look at exercising our NCIB. We still feel there's lots of headroom in share value, and so we do, and the renewal of our NCIB undoubtedly will be occurring, and we'll be exercising that as the board sees fit, but that continues to be a value creation opportunity for our shareholders. On the M&A side, I'm staying true to my word there. Our win rate reflects we are very, very competitive on the IP side, but that does not in any way prohibit us from bolt-on, add-on IP to our platform. That's the concept of a platform where we can easily think about complementary synergistic IP that would apply to a school district, to a municipality, and to a charity. Sure. sure It really does continue to be consistent with where we were previously. it really does continue to be consistent with where we were previously We will look at exercising our NCIB. we will look at exercising our ncib We still feel there's lots of headroom in share value, and so we do, and the renewal of our NCIB undoubtedly will be occurring, and we'll be exercising that as the board sees fit, but that continues to be a value creation opportunity for our shareholders. we still feel there's lots of headroom in share value and so we do and the renewal of our ncib undoubtedly will be occurring and we'll be exercising that as the board sees fit but that continues to be a value creation opportunity for our shareholders On the M&A side, I'm staying true to my word there. on the m&a side i'm staying true to my word there Our win rate reflects we are very, very competitive on the IP side, but that does not in any way prohibit us from bolt-on, add-on IP to our platform. our win rate reflects we are very very competitive on the ip side but that does not in any way prohibit us from bolt-on add-on ip to our platform That's the concept of a platform where we can easily think about complementary synergistic IP that would apply to a school district, to a municipality, and to a charity. that's the concept of a platform where we can easily think about complementary synergistic ip that would apply to a school district to a municipality and to a charity So we look at it from the standpoint of strategic, I don't want to call them just tuck-ins, it could be material, as well as the idea of how do we think about customer density as a key priority of M&A. Can we find an entity that maybe has legacy solutions that has a good customer cohort that has made the decision that they are not going to bridge to a full SaaS platform, or that is the risk in cash to do so is going to be too daunting? So that is very attractive in terms of our crosshairs of where we could already have existing technology and think about a deal and a deal structure that would allow an owner of a legacy customer community to work with us to upgrade those customers to our platform. So we look at it from the standpoint of strategic, I don't want to call them just tuck-ins, it could be material, as well as the idea of how do we think about customer density as a key priority of M&A. so we look at it from the standpoint of strategic i don't want to call them just tuck-ins it could be material as well as the idea of how do we think about customer density as a key priority of m&a Can we find an entity that maybe has legacy solutions that has a good customer cohort that has made the decision that they are not going to bridge to a full SaaS platform, or that is the risk in cash to do so is going to be too daunting? can we find an entity that maybe has legacy solutions that has a good customer cohort that has made the decision that they are not going to bridge to a full saas platform or that is the risk in cash to do so is going to be too daunting So that is very attractive in terms of our crosshairs of where we could already have existing technology and think about a deal and a deal structure that would allow an owner of a legacy customer community to work with us to upgrade those customers to our platform. so that is very attractive in terms of our crosshairs of where we could already have existing technology and think about a deal and a deal structure that would allow an owner of a legacy customer community to work with us to upgrade those customers to our platform Also on the M&A side, it may not always be an acquisition because we now have a broadened partner community. They have relationships with many, many solution providers that may not be in the business to be thinking of sale, but may be in a situation where they and we can derive royalties and dollars from them plugging into our platform and having access to our customer community. That's another area where we see revenue opportunity, not necessarily through acquisition, but through kind of partnering with synergistic providers. That necessarily isn't capital allocation required, but it broadens out how we think about adding value and adding scale. M&A, for as I said in my closing, we see Sylogist as a materially larger enterprise with leverage. That's both organic as well as inorganic. Also on the M&A side, it may not always be an acquisition because we now have a broadened partner community. also on the m&a side it may not always be an acquisition because we now have a broadened partner community They have relationships with many, many solution providers that may not be in the business to be thinking of sale, but may be in a situation where they and we can derive royalties and dollars from them plugging into our platform and having access to our customer community. they have relationships with many many solution providers that may not be in the business to be thinking of sale but may be in a situation where they and we can derive royalties and dollars from them plugging into our platform and having access to our customer community That's another area where we see revenue opportunity, not necessarily through acquisition, but through kind of partnering with synergistic providers. that's another area where we see revenue opportunity not necessarily through acquisition but through kind of partnering with synergistic providers That necessarily isn't capital allocation required, but it broadens out how we think about adding value and adding scale. that necessarily isn't capital allocation required but it broadens out how we think about adding value and adding scale M&A, for as I said in my closing, we see Sylogist as a materially larger enterprise with leverage. m&a for as i said in my closing we see sylogist as a materially larger enterprise with leverage That's both organic as well as inorganic. that's both organic as well as inorganic We're committed to both sides, and we have the team, we have the muscle memory, and we have a really good playbook to be able to think about acquisitions in a positive light. We're committed to both sides, and we have the team, we have the muscle memory, and we have a really good playbook to be able to think about acquisitions in a positive light. we're committed to both sides and we have the team we have the muscle memory and we have a really good playbook to be able to think about acquisitions in a positive light

Speaker 1: Excellent. Thank you. Just one follow-up on the synergistic partner efforts that you mentioned as a source of revenue. What has to take place for you to sort of turn that on, so to speak? Excellent. excellent Thank you. thank you Just one follow-up on the synergistic partner efforts that you mentioned as a source of revenue. just one follow-up on the synergistic partner efforts that you mentioned as a source of revenue What has to take place for you to sort of turn that on, so to speak? what has to take place for you to sort of turn that on so to speak

Speaker 9: Not a lot. Not a lot has to happen technically. We're continuing to build out our API suite to make that happen in a way that is kind of doesn't require, don't look behind the curtain, but is very much plug and play. Because we are part of that Microsoft Business Central as well as CRM platform, we get a lot of those plug-ins that happen technically kind of out of the box. So it's just really making sure that we are first focusing on our own knitting and bringing customers on and making sure that we have really good success in that gov and ed sector at a high level, and it's very repeatable. And then we think about complementary IP. Not a lot. not a lot Not a lot has to happen technically. not a lot has to happen technically We're continuing to build out our API suite to make that happen in a way that is kind of doesn't require, don't look behind the curtain, but is very much plug and play. we're continuing to build out our api suite to make that happen in a way that is kind of doesn't require don't look behind the curtain but is very much plug and play Because we are part of that Microsoft Business Central as well as CRM platform, we get a lot of those plug-ins that happen technically kind of out of the box. because we are part of that microsoft business central as well as crm platform we get a lot of those plug-ins that happen technically kind of out of the box So it's just really making sure that we are first focusing on our own knitting and bringing customers on and making sure that we have really good success in that gov and ed sector at a high level, and it's very repeatable. so it's just really making sure that we are first focusing on our own knitting and bringing customers on and making sure that we have really good success in that gov and ed sector at a high level and it's very repeatable And then we think about complementary IP. and then we think about complementary ip But those discussions and those from a strategy standpoint are already going on, and our Director of Partnerships and our Chief Revenue Officer, Grant McLaren, are all ears and engaged in conversations around what that could look like going forward. But those discussions and those from a strategy standpoint are already going on, and our Director of Partnerships and our Chief Revenue Officer, Grant McLaren, are all ears and engaged in conversations around what that could look like going forward. but those discussions and those from a strategy standpoint are already going on and our director of partnerships and our chief revenue officer grant mclaren are all ears and engaged in conversations around what that could look like going forward

Speaker 1: Okay. Excellent. And then last question for me. You obviously know the sort of margin targets or sort of soft guidance that you've given in terms of your level of investment. But as you scale, I think I maybe ask this question every quarter, but as you scale, if there's opportunity to invest more or to throw some dollars at something you're trying to accomplish, whether it's whitespace, displacement, are you comfortable maybe giving up some margin to do that? Are you holding firm on where you guys are? Can you just talk a little bit about the trade-off there? Okay. okay Excellent. excellent And then last question for me. and then last question for me You obviously know the sort of margin targets or sort of soft guidance that you've given in terms of your level of investment. you obviously know the sort of margin targets or sort of soft guidance that you've given in terms of your level of investment But as you scale, I think I maybe ask this question every quarter, but as you scale, if there's opportunity to invest more or to throw some dollars at something you're trying to accomplish, whether it's white space, displacement, are you comfortable maybe giving up some margin to do that? but as you scale i think i maybe ask this question every quarter but as you scale if there's opportunity to invest more or to throw some dollars at something you're trying to accomplish whether it's white space displacement are you comfortable maybe giving up some margin to do that Are you holding firm on where you guys are? are you holding firm on where you guys are Can you just talk a little bit about the trade-off there? can you just talk a little bit about the trade-off there

Speaker 9: I'll try to be consistent. We undoubtedly still, because it's foundational to our thesis as well as kind of how we're thinking and what the board is thinking about in terms of building the business, profitable growth is key. We're not looking to drain the piggy bank and try to Hail Mary. I'll try to be consistent. i'll try to be consistent We undoubtedly still, because it's foundational to our thesis as well as kind of how we're thinking and what the board is thinking about in terms of building the business, profitable growth is key. we undoubtedly still because it's foundational to our thesis as well as kind of how we're thinking and what the board is thinking about in terms of building the business profitable growth is key We're not looking to drain the piggy bank and try to Hail Mary. we're not looking to drain the piggy bank and try to hail mary But undoubtedly, when we have that kind of efficacy in our close and win rates happening, it certainly supports more and more lean-in in terms of, and the questions happened a few different ways today on the call here. We're very comfortable with more lean-in because it now is, if we can get one plus one equals three or four because of our sales and marketing motions and the efficacy of then also the wallet share expansion that we're seeing. The lean-in for us to be able to think about top line. It's a big part of how we think about it. Again, I just want to say our top line right now growth is just wonky because we're decelerating a major contributor to what that was in years past on project services. That's purposeful. And so I just bring that back as a key theme. But undoubtedly, when we have that kind of efficacy in our close and win rates happening, it certainly supports more and more lean-in in terms of, and the questions happened a few different ways today on the call here. but undoubtedly when we have that kind of efficacy in our close and win rates happening it certainly supports more and more lean-in in terms of and the questions happened a few different ways today on the call here We're very comfortable with more lean-in because it now is, if we can get one plus one equals three or four because of our sales and marketing motions and the efficacy of then also the wallet share expansion that we're seeing. we're very comfortable with more lean-in because it now is if we can get one plus one equals three or four because of our sales and marketing motions and the efficacy of then also the wallet share expansion that we're seeing The lean-in for us to be able to think about top line. the lean-in for us to be able to think about top line It's a big part of how we think about it. it's a big part of how we think about it Again, I just want to say our top line right now growth is just wonky because we're decelerating a major contributor to what that was in years past on project services. again i just want to say our top line right now growth is just wonky because we're decelerating a major contributor to what that was in years past on project services That's purposeful. that's purposeful And so I just bring that back as a key theme. and so i just bring that back as a key theme We want to get to SaaS ARR. That is happening now at a good clip. We see that expanding going forward, and we see it expanding with leverage in terms of the sales, marketing motions directly, as well as the idea of what our partners can add to our leverage on the sales and marketing side, so growth continues to be focused, and we will think about a balanced Rule of 40 discipline, but ultimately how that flutters between growth and EBITDA will be something that is generally opportunistic as we think about it. Now is the time. We've put in the investments. We've actually now come to market. There's a lot of excitement. We'd be remiss not to lean in and push on that, but it's going to still be done through that Rule of 40 posture and the discipline that we've demonstrated so far. We want to get to SaaS ARR. we want to get to saas arr That is happening now at a good clip. that is happening now at a good clip We see that expanding going forward, and we see it expanding with leverage in terms of the sales, marketing motions directly, as well as the idea of what our partners can add to our leverage on the sales and marketing side, so growth continues to be focused, and we will think about a balanced Rule of 40 discipline, but ultimately how that flutters between growth and EBITDA will be something that is generally opportunistic as we think about it. we see that expanding going forward and we see it expanding with leverage in terms of the sales marketing motions directly as well as the idea of what our partners can add to our leverage on the sales and marketing side so growth continues to be focused and we will think about a balanced rule of 40 discipline but ultimately how that flutters between growth and ebitda will be something that is generally opportunistic as we think about it Now is the time. now is the time We've put in the investments. we've put in the investments We've actually now come to market. we've actually now come to market There's a lot of excitement. there's a lot of excitement We'd be remiss not to lean in and push on that, but it's going to still be done through that Rule of 40 posture and the discipline that we've demonstrated so far. we'd be remiss not to lean in and push on that but it's going to still be done through that rule of 40 posture and the discipline that we've demonstrated so far

Speaker 1: Understood. Got it. Thank you. Yeah, that's it for me. Thank you very much, and keep up the great work. Understood. understood Got it. got it Thank you. thank you Yeah, that's it for me. yeah that's it for me Thank you very much, and keep up the great work. thank you very much and keep up the great work

Speaker 6: This concludes the question and answer session. I would like to turn the call back over to Mr. Bill Wood for any closing remarks. This concludes the question and answer session. this concludes the question and answer session I would like to turn the call back over to Mr. Bill Wood for any closing remarks. i would like to turn the call back over to mr bill wood for any closing remarks

Speaker 9: Yeah, I appreciate the questions, and I really appreciate the continuing support of our investor community. Excited about new dollars coming into the story that maybe we just didn't have enough breadcrumbs of performance to bring them in and bring them to the table. That's an exciting development for us, and we're very pleased that we're looking at an investor community that's been really incredibly supportive of our efforts. And I guess coming through a four-year anniversary just a couple of days ago for me coming into the company, I couldn't be more proud of what Sylogist has been able to accomplish over that time, not to my credit, but to the credit of the team and how much we've really stayed true to our mantra. Yeah, I appreciate the questions, and I really appreciate the continuing support of our investor community. yeah i appreciate the questions and i really appreciate the continuing support of our investor community Excited about new dollars coming into the story that maybe we just didn't have enough breadcrumbs of performance to bring them in and bring them to the table. excited about new dollars coming into the story that maybe we just didn't have enough breadcrumbs of performance to bring them in and bring them to the table That's an exciting development for us, and we're very pleased that we're looking at an investor community that's been really incredibly supportive of our efforts. that's an exciting development for us and we're very pleased that we're looking at an investor community that's been really incredibly supportive of our efforts And I guess coming through a four-year anniversary just a couple of days ago for me coming into the company, I couldn't be more proud of what Sylogist has been able to accomplish over that time, not to my credit, but to the credit of the team and how much we've really stayed true to our mantra. and i guess coming through a four-year anniversary just a couple of days ago for me coming into the company i couldn't be more proud of what sylogist has been able to accomplish over that time not to my credit but to the credit of the team and how much we've really stayed true to our mantra If we can get our customers at a good point, get our technology at a good point, there's very little to hold us back as we think about growing our footprint within the three sectors. So that is at a higher state of excitement for me than ever before. I continue to think about our team being the best in the business. I feel like the foundation we've laid at this point positions us well for really good things ahead, and I appreciate the support of our investor community and certainly our board, which is at an all-time, I guess I've never felt more supported, but I say that through a board that has now got really good expertise, really good wisdom, really good perspectives of companies at scale, technology companies, SaaS companies, the commercial side, the financial side. If we can get our customers at a good point, get our technology at a good point, there's very little to hold us back as we think about growing our footprint within the three sectors. if we can get our customers at a good point get our technology at a good point there's very little to hold us back as we think about growing our footprint within the three sectors So that is at a higher state of excitement for me than ever before. so that is at a higher state of excitement for me than ever before I continue to think about our team being the best in the business. i continue to think about our team being the best in the business I feel like the foundation we've laid at this point positions us well for really good things ahead, and I appreciate the support of our investor community and certainly our board, which is at an all-time, I guess I've never felt more supported, but I say that through a board that has now got really good expertise, really good wisdom, really good perspectives of companies at scale, technology companies, SaaS companies, the commercial side, the financial side. i feel like the foundation we've laid at this point positions us well for really good things ahead and i appreciate the support of our investor community and certainly our board which is at an all-time i guess i've never felt more supported but i say that through a board that has now got really good expertise really good wisdom really good perspectives of companies at scale technology companies saas companies the commercial side the financial side So I also want to give credit to our board and appreciation to our board. Our board punches above its weight class. I think our management team does the same, and I think Sylogist, from the standpoint of our execution, is really hitting on our cylinders very well. So thank you for your time today. Thank you for your continued support. Be well. So I also want to give credit to our board and appreciation to our board. so i also want to give credit to our board and appreciation to our board Our board punches above its weight class. our board punches above its weight class I think our management team does the same, and I think Sylogist, from the standpoint of our execution, is really hitting on our cylinders very well. i think our management team does the same and i think sylogist from the standpoint of our execution is really hitting on our cylinders very well So thank you for your time today. so thank you for your time today Thank you for your continued support. thank you for your continued support Be well. be well

Speaker 6: The conference is now concluded. Thank you for attending today's presentation. You may now disconnect. The conference is now concluded. the conference is now concluded Thank you for attending today's presentation. thank you for attending today's presentation You may now disconnect. you may now disconnect