Notes from the Q4 2018 CC

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• Revenue guidance for 2019: $105M-$115M based on 75%-80% conversion of backlog.
• Positive EBITDA and cash flow for the year (although mostly coming from H2).
• Market is projected to grow by 50% CARG according to Gartner.
• Some gross margin reduction with the acquisitions of Artilium and iPass, from the 70s to the high 50s, low 60s as the Artilium and iPass solutions require more hands-on usage.
• Artilum cross-sell opportunity is large, they concentrated on front end customer and enterprise solutions, Pareteum mostly back-office, can sell to one another both ways.
• With the acquisitions the company is now fishing in a much larger geographical area and they doubled their sales headcount to address these opportunities.
• Business has three segments, enterprise, IoT and traditional CSPs (service providers), the latter will still be the biggest (>50% in 2019).
• The company implemented a salesforce.com system to add sales
• Management looking for smaller tuck-in acquisitions to add technical capabilities.
• Management sees 55$ growth in 2020, 40% in 2021.
• There are some implementation risks which they have so far eluded, like customers going bankrupt or taken out, or not paying. The $50M credit is for this, as well as eliminate the much more expensive $11M debt from iPass.