Sylogist Ltd

TSX:SYZ

Earnings Call Transcript 2022-Q4

[Operator]

Thank you for standing by. This is the conference operator. Welcome to the Sylogist Limited's earnings call for Q4 2022 and 12 month ended September 30, 2022. [Operator Instructions] And the conference is being recorded. [Operator Instructions]

I would now like to turn the conference over to Bill Wood. Please go ahead, sir.

[William Wood, executive]

Good morning, and welcome to our earnings call for Q4 of fiscal 2022. I'm Bill Wood, Sylogist President and CEO. And on the call with me today is Xavier Shorter, our Chief Financial Officer. In a moment, we will walk you through our performance for the quarter that ended September 30, 2022.

First, an important housekeeping reminder. As we announced on November 1, we have moved our fiscal year end from September 30 to December 31. We will complete a 15-month transitional year on December 31, 2022, and release audited financials for the year in March. In this call and other disclosures, 2023 now means both calendar 2023 and fiscal 2023, which refer to the same time period.

I should also note that this call may contain forward-looking statements relating to the future operations and profitability of the company, any of which are subject to risks, uncertainties and assumptions, and actual events or outcomes may differ materially from those we contemplate here. Any such forward-looking statements are made as of today. And except as required by law, we have no obligation to revise them.

Sylogist is a software-as-a-service, or a SaaS, company that provides mission-critical solutions to over 2,000 customers worldwide, primarily in 3 public sector verticals, education, not-for-profit and government. We've come a long way in 2022.

Organic growth has gone from negative in Q1 to 6% this quarter. Our strategic investments in product, talent and go-to-market initiatives drove expansion. This organic growth would have been 8% had not been for the strategic purposeful discounts granted to the customer communities on our Sunpac and Bellamy legacy products in return for their long-term commitments.

We showed record bookings in Q4, winning new contracts worth $12.1 million, including a $1.2 million ARR increase. These record bookings included some material sales that we had expected to close earlier in the year, which would have pushed organic growth into the high single digits for the year overall, with the corresponding subscription revenue recognition and related project services revenue that would have started to show up in early Q3 where they were forecasted.

Our revenue backlog is up nearly 20% from this time last year and over 40% from last quarter, and deals in the pipeline continue to track and matriculate. With the strong back half of the year in the books and the momentum we have, we are excited about the upcoming year.

Most notably, we are focused on 3 organic growth initiatives. We believe these initiatives have an ROI that is greater than other capital deployment opportunities, and we are quickly moving to invest behind them and realize this value.

We are excited to announce that we are rolling out a new brand strategy based on these growth initiatives, SylogistGov, SylogistEd and SylogistMission. Previous brands and product names, as you knew them, will be phased out in most contexts. This will simplify and concentrate the Sylogist identity, increase clarity relating to the markets we serve and increase the impact of marketing activities.

I'd like to take a minute to provide a little more information on these 3 exciting initiatives. First, we are rolling out a new 100% SaaS municipal government solution, SylogistGov. The platform is already being implemented at several early adopter customers, and we expect a full scale launch in the second quarter of 2023.

SylogistGov will allow us to compete and win in the large North American municipal government market that's characterized by fragmentation and legacy systems by providing a complete modern SaaS solution and a commitment to the high level of service they deserve.

SylogistGov is aimed at midsized municipalities where the vast majority of cities and towns are and provide a convincing, easy upgrade path forward for our existing customers. As I said, the opportunity is substantial, and we are very well positioned to capture market share as the COVID-19 pandemic amplified the need for municipalities to transition from their on-premise legacy systems to a modern SaaS solution. We expect SylogistGov go-to-market investments in 2023 to accelerate organic growth in '24 and beyond.

Second, we are driving the geographic expansion of our SylogistEd platform, the SaaS IP we acquired in 2021 and are now ready to take elsewhere. Building on our dominant market share and remarkable customer happiness in Oklahoma, we are seeing substantial increase in North Carolina and several other states. And we are investing in the go-to-market capacity needed to realize this opportunity.

Third, we are increasing growth and delivery capacity investments in SylogistMission, our newly integrated dollar-raised-to-dollar-delivered platform for charitable organizations. SylogistMission is a culmination of seamless integration of our well-regarded ERP, granted awards management and outcomes measurement solutions, with our MISSION CRM fundraising and SylogistPay IP stacks.

With its go-to-market strategy gaining traction, we are making further investments to accelerate growth and build delivery capacity for rising demand. Similar to SylogistGov, the new SylogistMission platform also provides our NPL customers with an even more convincing SaaS solutions to upgrade, too, and creates additional wallet share opportunities when they do so.

These high ROI organic growth initiatives and the broader market environment have created new capital allocation opportunities. Sylogist prides itself on capital discipline and has prioritized maximizing shareholders' total return. For many years, this discipline included returning millions of dollars each quarter to shareholders through a dividend, which had risen to be meaningfully larger than that of our tech sector peers.

Over the past 18 months, the context of this strategy has changed significantly. We have made material investments to drive growth, while maintaining a Rule of 40 posture and are consequently now seeing record revenue, bookings and backlog together with strong profitability with the effective execution of our strategic plan.

As I've signaled since I joined, demonstrable, accelerating growth, an experienced management team executing to plan the successful integration of 3 acquisitions over the last 18 months, material growth opportunities now teed up and a robust M&A pipeline has made it clear to us that shareholders are now best served by deploying capital behind the growth and value creation opportunities I highlighted.

Changing the quarterly dividend to $0.01 makes available approximately $11 million per year in free cash flow, which we will use to self-fund these growth initiatives, pay down debt and build capacity for further strategic M&A.

Sylogist also intends to seek approval for a normal course issuer bid as part of its capital allocation strategy, which can be used to return capital via share buybacks when advantageous. We are confident that these are the optimal moves to long-term shareholder value creation.

I'd like to now turn things over to Xavier to take us through the quarter in more detail. Xavier?

[Xavier Shorter, executive]

Thanks, Bill.

Revenue for the quarter was $14.2 million, up from $10.8 million in Q4 2021 and $13.7 million last quarter. Growth relative to 2021 came mainly from the acquisitions of pavliks and MISSION CRM, both at the beginning of fiscal 2022, while growth relative to last quarter is reflective of organic growth and large deals ramping up.

Our gross profit margin for the quarter was 62% compared to 74% in Q4 2021. As anticipated, margins were lower mainly due to a larger share of our project services in our revenue mix, as major new implementations and upgrades ramps up.

Operating expenses were also up mainly due to the 2022 acquisition and the already started investments in our go-to-market capacity.

Adjusted EBITDA was $4.1 million in Q4, down from $4.8 million last year due to our growth investments. Our adjusted EBITDA margin remained strong, 29% for the quarter and 30% for the year-to-date. Sylogist will continue to balance growth and profitability as we drive the new initiatives that Bill outlined.

Q4 profit before income tax was $611,000, down from $1.9 million in Q4 last year. This decrease was due mainly to noncash depreciation charges related to our 2022 acquisitions as well as increased go-to-market spend.

Net income was slightly higher than in Q4 2021 due to a deferred tax recovery in the quarter.

Our balance sheet remained strong as we finished Q4 with over $19 million in cash and under $26 million in debt. While our strong adjusted EBITDA and growth prospects can support material leverage, paying down debt will reduce exposure to the rising interest rates and enhance our capacity for strategic acquisitions.

With that, I'll hand off the call to Bill for some final thoughts.

[William Wood, executive]

Thanks, Xavier. I'd like to give you a sense of what the next year is going to look like for Sylogist.

Sylogist remains committed to balanced profitable growth and a Rule of 40 posture. In the coming year, we expect continued upside realization from the organic growth initiatives we've made and we plan to lean into even more.

The same execution of our plan that drove this quarter's record bookings will drive more new logo wins and upselling and cross-selling over the coming quarters as our platform versus siloed product strategy takes off.

We expect revenue from the new SylogistGov, SylogistEd and SylogistMission growth initiatives to ramp in late 2023 and into 2024. The timing is largely due to customer buying cycles in our markets. We expect the overall year to close with low double-digit organic growth and commensurate Rule of 40 EBITDA.

Lastly, with my 2-year anniversary with the company last week, I'd like to emphasize how far Sylogist has come in a relatively short period of time, more specifically, the real transformation that's occurred and why we're so excited about our future.

Execution of our strategic plan, which included investing and aligning to achieve a full SaaS posture, and go-to-market readiness for our new platform offerings, very high IRR and customer retention, a customer Net Promoter Score that's 2x higher than when it was when I started, which I mentioned because of the importance of strong customer references in our public sector markets, and attracting and aligning great talent to complement the team that was holding the fork, these accomplishments and attributes set the stage for accelerating the value creation opportunities that are now right in front of us.

We will continue to innovate, strive to exceed customer expectations, accelerate profitable growth and drive shareholder value creation in 2023.

I'd like to now open up the call for questions as time allows.

[Operator]

[Operator Instructions] The first question comes from Amr Ezzat of Echelon Partners.

[Michael Vaccarino, analyst]

It's Michael on behalf of Amr. Can you speak to how conversations are evolving with clients, both existing and potential, in light of a more fragile economic outlook?

[William Wood, executive]

Michael, overall, we're not seeing any increased trepidation relative to, I guess, the collision between the need for them to go through the digital transformation, as I talked about in my prepared remarks, vis-a-vis the idea of the economic pressures that -- inflationary pressures that are occurring.

We're not seeing the overall dialogue being polluted by the financial market realities currently, so we feel quite strong about the cadence continuing.

[Michael Vaccarino, analyst]

Good. And then how should we think of margins going forward in light of inflation and the investment in the business? Should we expect some compression from these levels? Or are we close to the trough?

[William Wood, executive]

Overall, we feel that we're generally in the area where we believe margins can continue. We believe that our ability to attract talent and retain talent continues to be within our budget, which is solid. And overall, we believe our investments, while they would continue, we expect that those will be balanced as we go forward in the posture that I described.

[Michael Vaccarino, analyst]

Okay. And then on your M&A pipeline, should we expect to be more acquisitive in the next 12 months relative to the last? And then at the same time, with the NCIB, at what level do you prefer to repurchase shares over alternative uses of capital, while we're on the capital allocation question?

[William Wood, executive]

Yes, I'll take those in reverse. The Board will consider opportunities, as I outlined in my remarks, so relative to the NCIB, and I think to that end, there's no prescribed number at this time. It really is really where shareholder value creation could occur by -- with a buy back.

I think to the extent that we're moving forward with a plan in terms of our overall capital allocation, M&A in and of itself, we're in a very good position with a -- as we strengthen our position to look at M&A opportunities, but we will continue to tighten our lens around those.

I think, primarily because of focus, we're very excited about what we've teed up, the initiatives that are right in front of us, and we want to make sure that management and all team members are hyperfocused on execution against those real growth opportunities that we see as substantial from an ROI standpoint.

That certainly doesn't preclude M&A as we continue to have even a more robust pipeline of discussions going on with firms. And I think to that end, they continue to be scrutinized through the idea of is it complementary IP that we would seek. And right now, we feel our platforms, given the markets that we are targeting, SylogistGov, Ed and Mission are well rounded and not really missing any pieces.

So we feel that the IP piece is less valuable to us from an acquisition standpoint than the idea of customer density and the idea of talent. So we still continue to look at M&A as a very interesting accelerator for value creation, but it's going to be balanced with the idea of the tighter lens for the reasons I just shared.

[Operator]

The next question comes from Jim Byrne of Acumen Capital.

[Jim Byrne, analyst]

Just a couple for me. Bill, I was wondering if you could just expand on any of the new bookings, whether that's maybe new logos, new sectors or sectors of strength that you could give us some details on where those bookings are all coming from.

[William Wood, executive]

Jim, not surprisingly, for the reasons I shared, we had booking activity across all divisions, and that included both material large deals that, as I've said, had been in the pipeline that slid a little bit that we pushed to later in the year. And I think that, that is further giving us confidence that there's really no new pressures that are being placed onto our markets that are causing deals to disappear.

Overall, the bookings that we've seen have a great balance of IP as well as the idea of services related to those project services related to those. So I feel good about the new logo pickups that are going on, and I feel very good about the sales pipeline that we see and the continued matriculation of those deals.

[Jim Byrne, analyst]

Okay. And then I know your product innovation development kind of works on, obviously, with customers in mind. And you're not kind of creating kind of blue sky products. But just maybe give us an idea of what you are working on currently, where -- what are you really focusing your energy on, on the product side or the IP side in terms of opening up, whether it's, like as you said, previously new logos or other geographic areas.

[William Wood, executive]

The geographic areas, I want to be clear, that doesn't mean necessarily adjacent markets. We really are hyperfocused on those 3 markets, as I said. And I think to that end, the build-out of our product -- products to platform has really been the culmination of our own internal work on our existing products, plus the acquired IP that we have brought on into not just the idea that they all are underneath one tent, but do they actually deliver something different to the market in terms of visibility for the data that's going into them to support decision-making, better engagement, whatever that may be.

Most significant product development has been the top to bottom rewrite of our municipal solution, the SylogistGov solution. And I want to highlight the fact that at the core is our longstanding, well-regarded ERP solution. And to that end, the municipal government space, we had very good DNA in and strong understanding of because of the IP -- the legacy IP that we've had in that space.

So while we certainly didn't just rest on that as our blueprint for the go-forward, we've really been leaning in on the idea of the competitive landscape as well as the voice of customer, round tables to make sure that we were not building to where we were, but ultimately to where we want to be, not just for 2023, but well beyond.

So to that end, the idea of the -- all of the modules that go into running a city and town as well as the customer-facing engagement, the citizen engagement, asset management and licensing and permitting and so on and so forth, that's where the majority of our lean in has been over the last 6 months, and we'll continue here over the next 3 to 4 months as we then roll out the complete platform in early 2023.

[Jim Byrne, analyst]

Okay. Maybe just one note of clarification. So I think in your opening remarks, you did say low double-digit growth for now fiscal and calendar '23. I just -- I had it in my head, maybe I misread it in the MD&A. I thought it said low single digit, but I -- maybe I need just a little bit more clarification there.

[William Wood, executive]

If it did, Jim, that will correct that. But yes, it's the posture as we see going forward is low double digit as we exit the year because of those buying cycles that our market has, which is largely midyear placed.

[Operator]

The next question comes from Gavin Fairweather of Cormark Securities.

[Gavin Fairweather, analyst]

Appreciate the disclosure around bookings and backlog. I was hoping we could go kind of one step up in the sales pipe and discuss some of the trends that you're monitoring in terms of kind of the size of your pipeline, how some of your new sales members are kind of developing pipe and how that would kind of distribute across kind of top of funnel versus leads, which are a bit more developed.

[William Wood, executive]

Gavin, thanks for the question. For us, the pipeline, I believe now, just mechanically, we have much better pipeline, too, because part of our efforts have been to make sure that -- which traditionally were disparate, different marketing systems are now been aggregated into one company-wide system.

So all of the initiatives are tracked with the same KPIs and same data points relative to first initial inquiry to the idea of what happened to that deal as it moves through.

The deals coming in, as I shared, my history has been trying to get them as deep into the funnel as possible before we're having to pick those up. And we're seeing a good amount of lead activity really within our ICP, within our ideal customer profile, which is exactly where we want it to be. We don't want to be chasing or having to respond to those that are outside of what our ICP and where -- and we know we have a great opportunity to win.

The key component is many of our offerings in the past were not as IP focused in terms of our ARR as they are now. We have completely changed our pricing in terms of the idea, always having a material IP component, which will drive our ARR and subscriptions, balanced with then higher billing rates than were traditionally being charged on our project services side.

So the deals that are coming in are through that new lens, as I just shared, and we feel very good about our ability to win on the competitive landscape because of where we sit in terms of our IP stack in a full SaaS posture that some of our competitors do not have, and the idea of the strong customer satisfaction that we can point to because there's just going to be that component where they want strong -- where they want to speak to colleagues in the space, and our customers speak on our behalf in the way that they are now is really serving us well.

[Gavin Fairweather, analyst]

That's helpful. And then maybe kind of on a related topic, how do you think about the organic growth potential for this business? Obviously, you've done a lot of work on the R&D side, and you discussed how your IP stack has evolved at the same time you're investing in sales.

Those investment levels are kind of moving a little bit higher near term. I think for fiscal '22, you were targeting high single digit. You're saying kind of low double digit for '23. But I know you've got some sales cycles, factors to consider.

So do you think you can then push that higher in kind of '24 and beyond. How do you think about that relative to your investment levels?

[William Wood, executive]

Yes. Thanks for that question because it actually is one that I would want to speak directly to, which is absolutely yes. We feel the ability for us to drive our organic growth up is certainly there. There's plenty of headroom. And for our go-to-market to start to be taking hold the way that we see it being, and then just appreciating the buying cycles, we are really delayed in the ability for us to start driving and showing the materiality of the bookings and ARR to be skewed in the back half of any given year.

So the actual flywheel and compounding effect of that going forward, as we build in more ARR, will drive that organic growth higher, as we continue to get passive revenue into our portfolio and continue to drive and look to push IRR above 100%, as we have more product portfolio, more IP for customers to be able to take up with our platform versus siloed products of old.

And so the cross-selling and upselling, I think, will further drive organic opportunities, as the platforms are migrated to and installed at the customers.

[Gavin Fairweather, analyst]

And then just on the municipal solution, curious for some further thoughts on how you plan to attack this opportunity. Obviously, it's a pretty big market. Maybe just discuss your thoughts around maybe migrating the Bellamy customers and how you're thinking about really going after new logos and what kind of typical deal sizes would look like in the space. Just some further thoughts there would be helpful.

[William Wood, executive]

Sure. The overall market is begging for a mid-market solution, and it's what we've been hyperfocused on strategically to deliver. You have the giants in this space who just love the big cities. And frankly, they can slug -- have that slugfest on their own.

But for us, there really has not been a mid-market solution that is a full SaaS posture, that is modern and that delivers the kind of comprehensive solution that SylogistGov does and will continue to going forward.

The market is huge, tens of thousands overall in North America, and there's many legacy providers that have just rested too long on where they sit with those customers. And so we have identified specific pockets that we believe there's material customer density that we can displace and ultimately have a very easy onboarding experience.

And typically, that's related to the data migration that goes with that. It's great to celebrate new functionality, but what about my data, if you will. And so we're going to be very focused on where we believe and where we've identified through our research, where we know there's customer communities that are quite disenfranchised with regard to their relationship with their provider. They're not getting any sense that there is a modern path forward, and we -- we're hyperfocused on that.

And we will do that through a combination of some direct stand-up early, but we see that largely being complemented by a partner channel play to really get the kind of coverage that we are -- we envision it will require in North America, where we'll be using our partner community and selecting new ones in and recruiting new ones in with the idea of their local presence and relationships being leveraged, and then also their delivery to get scale when we're talking of dozens at the same time, if not more, the ability to have partners deliver the services related to the implementations with our playbook.

So scaling to meet the opportunity is going to be through the partner channel. And the deals are anywhere, usually low 6-figure, a combination of IT in the vicinity of $100,000 to $150,000 per year. And then the idea of services on top of that. So -- and we will slide down to probably IP subscription that is maybe in the $75,000 to $80,000 range, up to $200,000 on an annual basis is really our sweet spot.

[Operator]

The next question comes from Nick Agostino of Laurentian Bank Securities.

[Nick Agostino, analyst]

So Bill, how should we be thinking about just the Rule of 40 posturing given that you're now looking for a more accelerated organic growth in that low double-digit range?

And this quarter, we've seen a little bit of a slip on the EBITDA margin side. Should we -- when we think about Rule of 40, should we be thinking more of a company now that has an even higher organic growth rate, and maybe you're going to have to spend a little bit more to get to that level, so a little bit of a pullback on the EBITDA margin?

Or do you -- should we be thinking about a Rule of 40 with a higher positioning versus where you would have been, say, 3 months ago before you were thinking about higher organic growth?

[William Wood, executive]

Nick, overall, we are continuing to make investments, so that will continue to put pressure -- a little bit of pressure on our EBITDA, as we then drive into the second part of the year, as we then start to get more materiality of bookings and the subscription starting to take hold, both in terms of new bookings, but also the bookings that we made here into Q4 and before -- Q4 and before.

So our ability now, this is not a situation where we have a material R&D -- a new R&D that must occur. We're not seeing a situation where, as I said, wages in our largest expense is people. We feel very good about where we are on that front and our ability to attract and keep very good talent, which is our power source for going forward undoubtedly.

So to that end, while there could be some fluctuation relative to the balance between those 2, we do see our ability to continue to have strong profitable growth as we go forward and have a commitment to maintaining a balance.

And as obviously,growth accelerates in the back half, that doesn't necessarily mean that because of the partner channel that we intend to drive through, we don't see that, that has to overly burden us with huge headcount changes as we scale to respond to opportunity.

[Nick Agostino, analyst]

Okay. I appreciate that color. Second question is you spoke about the growth on the bookings quarter-over-quarter record number, I believe. But you talked about some delays. I guess, the stuff that you expected in Q3 pushed into Q4. Maybe just a little bit more color as to why the delays and maybe why the free-up in Q4.

[William Wood, executive]

After 30 years, I wish I had a crystal ball that allowed me to put deals in the quarter in the public sector. It's just -- there's just variables that are out of our control. They, in some ways, were no indication of a pause, of further diligence that was required. It was really just the approval of those deals getting through, either the government side or the municipal side.

Sometimes, they just slide. And I hope you all will appreciate going forward. Quarter-for-quarter for us is not necessarily a good indication of performance. It really is about the aggregate overall. And I think to that end, $12.1 million, as I said, it really was a material deal or 2 that slid into that quarter into the fourth quarter.

But I don't want it back to signal that there was anything that caused -- anything unusual that caused those delays. It's just the nature of the business.

[Nick Agostino, analyst]

Okay. Fair comment. And then when you look at the new go-to-market strategy and the rebranding, through that whole exercise, are there assets that have come up that maybe you feel don't fit the business model anymore? And if so, are you looking to maybe divest some assets? And have you taken -- have you started that -- those initiatives?

[William Wood, executive]

Strategically, that has been kind of housekeeping that we have done since I started. And obviously, from a management team standpoint and in close consultation with the Board, while we do have assets within our portfolio that may seem asymmetrical, we certainly appreciate that there's cash contribution and EBITDA contribution from those divisions.

However, successful companies are really about focus, in my opinion, and execution against our plan. And so to that end, we certainly look at those assets and look at the market conditions that may -- that are in front of us right now in the tech sector.

We're not going to, in any way, hand those to someone where we don't feel there's good return for what it is that we have put into it and the value we think they represent. So while we will consider and we are open and have contemplated of what those assets and what those transactions could look like, we're certainly not in any position to have to fire sale them from a cash need standpoint or whatever. We really are in a strong position to consider any of those quite thoughtfully, Nick.

[Nick Agostino, analyst]

Okay. And then my last question. Now that you've announced the dividend cut freed up some capital, I think, in the past, your intent was to add about $20 million, $25 million of acquired M&A annually. And certainly for 2022, it's been very quiet on that front.

Do you think that now that you've got more capital that, that's something, a target that you plan to achieve for 2023? Or are you looking at maybe lowering those M&A expectations?

[William Wood, executive]

The idea of where inorganic fits with organic is now through that tight lens of, is it the best use of capital relative to return on investment, and we feel very bullish about our organic growth ROIC. We feel very good about where we are in our ability to go out and win new business.

That does not dampen our interests for M&A. And to the extent that there's still some delay, I feel, out in the space where some of the private sector companies are still believing and of the stance that they are maybe more valuable than we see them as being, given some of the buying frenzy that had occurred over the last several years, we can be patient.

And as I said in my earlier comments and question, there's nothing missing in our IP offerings right now that we are saying we just got to go out and get buy versus build that's going to get us somewhere more quickly.

So to that end, while we certainly are -- we'll aggressively look at M&A and continue to talk to providers and try to identify as we demonstrated at 2 out of the 3 that necessarily aren't in a process.

We can do that now with a little more patience. And ultimately, the dollar threshold of those, I don't think it necessarily changes a whole lot, Nick. But if it becomes lower than that, it doesn't -- it should not signal any cause or any concern -- cause for concern, excuse me, on that front. It simply did we feel that it was the best use of capital for what we were looking to do and opportunities that we have.

[Operator]

This concludes the question-and-answer session. I would like to turn the conference back over to Bill Wood for closing remarks.

[William Wood, executive]

Yes. I just want to echo the -- how confident and how excited we are about the go-forward. There was a lot of work to be done at -- so just relative to kind of changing and transforming from who we were to who we are now. And I certainly feel that the pieces are now in place for us to recognize the value creation that I have transparently shared and talked with you all about in terms of the opportunities that were available for Sylogist.

I see them as even greater than what we had planned and believe them to be. I feel very good about our team and our ability to attract talent. And I feel very good about where we are on our customer outreach and our ability to think about them as our best marketing tool going forward.

Now about go-to-market execution, we had to certainly look at alignment of the company. We had to look at alignment of talent. We had product efforts that we needed to undertake that were significant, that many companies stumble with. And to be able to do that with largely threading the needle and balancing between spend and growth, I feel very good about our ability to deliver on what we said we were going to do. And I feel very good about what 23 holds for us and beyond.

So thank you for your continued support and interest in Sylogist. We sincerely appreciate it.

[Operator]

This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.