For those that don't follow the RB BLLS thread:
My detailed CC notes:
I established a good connection just before Lori started going over the financials. My notes are below and my comments are in
parenthesis. My notes are in chronological order and I was writing them quickly, so someone please correct any errors! Only the
content within quotes is acutally a quote from the conference, the rest is my paraphrase.
Lori:
- BLLS exited the quarter with "three live customers." (This raised a flag for me because I was told that number would be six
within one week of 3/28).
- R&D expenses for the Q were $125,000. (Is there just not much R&D needed in this industry? That's probably only one person's
salary and some hardware).
- Purchased $2 mill in property and equipment last year and will triple that this year. (Someone correct me if I misunderstood what
Lori was saying about this).
Louis Hoch:
- Using their partnership with Checkfree, BLLS recently brought up a large utility company in less than two weeks. (If that
company is live, this is quite impressive and could be a big seller to potential billers!)
David Jones:
- Announced three recent agreements the bills.com subsidiary has made. (Sorry, I didn't get the names)
- There is more info on bills.com in an answer later on, so keep reading... ;-)
Q & A:
Dan from Legg Mason:
Q: Asked about the interactive call center and it's status
A: It's live today with Reliant in pilot mode. Avista is set up as a "remote" ASP. (Not sure what this really means). They have
limited capacity in their current facility, but will be able to expand in the new facility. E-Care will be the first division to move into the
new building in late June/early July. Once moved, they will pursue other customers.
Mark from PMG:
Q: How does E-Care generage revenue?
A: There are two models. The first is an Internal Strategy which means a customer outsources their care in full or in part. This
model is priced on a per transaction basis--$3 for data calls and $4 for voice calls. The second model is a "Remote ASP" and that
charges a monthly charge per "seat." (I'm not sure what the Remote ASP model is compared to the Internal model...can
someone help out?)
Q: How does the outsourcing model save the customer's money?
A: According to every biller that BLLS has polled, the $4 a call is much cheaper than they currently pay. Utilities pay about $8 a
call currently and Phone companies can pay as much as $20 a call.
General comment from Mark: "Thank you and congratulations on a good quarter."
Paul from Fidelity and company: (I'm not sure I have the affiliation correct...I wasn't getting good reception during this time frame).
Q: 65% of the business is from resellers (NCP, etc). What is their incentive to push the billserv.com technology?
A: Some of the resellers do view billserv.com as competiton (so why did they sign an agreement??), but most are excited about
the technology. BLLS is currently putting together a product with NCP. (any expansion on this point would be much appreciated...I
was distracted).
Jeff from Crutchfield: (Again, not sure about the affiliation)
Q: What is the cash flow for operations?
A: Long pause...and Lori resonded that she didn't have it in front of her, but could answer that question off-line. That information
will also be released in the financial report on Monday.
Q: Has BLLS discussed forming an implementation team to help billers get up and running as well as market the service?
A: Yes. When the service is deployed, there is a team of BLLS representatives as well as customer representatives. One of the
customer representatives is a marketing person.
Q: Will Checkfree's purchase of Bluegill affect billserv.com?
A: That purchase does not change the relationship.
Q: The Well's Fargo agreement (Spectrum) was a good announcement, what other agreements can we expect to see?
A: BLLS currently has agreements with all but one aggregator, which is paymybills.com. They do have a letter of intent with
paymybills.com. There are other aggregators that could be coming on-line, and management will decide if an agreement with
those companies is beneficial when the time comes. (This was impressive...every aggregator under contract or in discussion.
That means BLLS can play ball on any field...nice positioning, management!)
Q: What is the traffic on customer sign ups? (I don't know if this quesiton was about billers or bills.com, sorry...distracted again)
A: There has been a 100% month-over-month increase for each of the last 3 months. (Impressive)
(I may have to listen to this question again...I don't really understand my notes)
After a couple other callers, Jeff asked some more questions...
Q: What is the concern with placing the secondary at this time?
A: Market status is considered. BLLS has the luxury of waiting until conditions better favor additional financing.
Q: Are you concerned about potential buyout?
A: No. It would be flattering, but they would only accept the offer if it's the right thing for the company, shareholders, and
employees. Many factors have to be considered. Of course, there could be a hostile bid, but management would do what they
could to avoid that.
Doug Sass, aka Gribbit:
Sorry Gribbit, my connection was lost not long after you were introduced.
There was another caller here that I missed...just heard the tail end of the answer
Dick from PaineWebber:
Q: What is the cash balance and burn rate?
A: $9 mill in cash. Burn is $600-700K/mo. Revenue is being generated at a projected $50-100K/quarter and is increasing. This
revenue is from setup fees BLLS receives (remember, they get the money up front, they just have to report the income over the
length of the contract...seem's like an accounting nightmare to this non-accountant). The current cash reserve gets us toward the
end of the year. BLLS is well positioned for other financing and several options are being evaluated.
Q: For Mr. Long: What other options are being considered?
A: A secondary is a possibility, so is a private placement. Mr. Long's feel from bankers is that the market will remain volatile until
Q3 of this year, so the volatility is being considered.
Q: SallieMae is one of the largest billers in the nation, what is their status will BLLS?
A: It's good and there are currently two agreements. The first is billing student loans. Currently, Sallie Mae can pay through CKFR,
paytrust, and BoA. Right now the volume is low, but Sallie Mae will begin marketing the service soon. The second agreement is a
new one where BLLS and Sallie Mae are partnering to provide goods to colleges. They have two colleges signed and are talking
to several others. (Can someone expand on this second agreement??)
That was the last caller that I noted.
Mr. Rhoney provided a wrap-up statement saying that BLLS had built a solid foundation and was executing it's business plan.
Whew! That's it...
If you have questions about anything, I suggest you listen to the replay (888/568-0908, and the pass code is 78232).
I think we are headed in the right direction and am confident in management. They exuded confidence and excitement. |
