TruBridge, Inc. (TBRG) Q4 2019 Earnings Report, Transcript and Summary

Good afternoon, and welcome to the CPSI Fourth Quarter and Year End 2019 Earnings Conference Call. [Operator Instructions] please note today’s event is being recorded.I would now like to turn the conference over to Drew Anderson. Please go ahead.

Good afternoon, and welcome to the CPSI Fourth Quarter 2019 Earnings Conference Call. During this call, we may make statements regarding future operating plans, expectations and performance that constitute forward-looking statements made pursuant to the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995. We caution you that any such forward-looking statements only reflect management expectations and predictions based upon currently available information and are not guarantees of future results or performance. Actual results may differ materially from those expressed or implied by such forward-looking statements as a result of known and unknown risks, uncertainties and other factors including those described in our public releases and reports filed with the Securities and Exchange Commission including but not limited to our most recent Annual Report on Form 10-K.We also caution investors that the forward-looking information provided in this call represents our outlook only as of this date and we undertake no obligation to update or revise any forward-looking statements to reflect events or developments after the date of this call.At this time, I will now turn the call over to Mr. Boyd Douglas, President and Chief Executive Officer of CPSI. Please go ahead, sir.

Thanks, Drew [ph]. Good afternoon, everyone. And thank you for joining us. Joining me on the call today is Matt Chambless, our Chief Financial Officer. At the conclusion of our prepared comments, David Dye, Chief Growth Officer will join us for the Q&A session. Chris Fowler, will not be on the call today as he’s out sick with the flu.We’re very pleased with the performance in the second half of the year on a number of levels. An important highlight was our strong bookings that totaled $51 million in the second half of the year and more than 20% increase over the second half of 2018. In looking at our nearly $18 million in software system bookings in the fourth quarter, it is worth noting that we’ve seen an increase in the average contract price which we believe is being driven by shift and competition as well as our increasing product competitiveness as we continue to make progress delivering on our single platform solution. 2019 also reinforced our optimism around the growth opportunity outside the US.We signed a $2.1 million acute EHR contract in the Caribbean in 2019 and added another Caribbean contract to bookings in the first quarter of 2020. In addition, during the fourth quarter of 2019 we announced our partnership with Sunnybrook Health Sciences Center to create a first of its kind, Canadian-made hospital information system solution. This strengthens our prospects for pursuing the robust Canadian EHR replacement market over the next five to 10 years.Finally, while it will take time to realize we are seeing genuine interest from international government health agencies in our Get Real Health patient engagement solutions. Including in Canada, where GRH’s existing footprint could help further accelerate our EHR prospects. Central to our growth strategy our services business TruBridge had another impressive quarter with $9.6 million in total bookings, a 24% increase year-over-year and over $109 million in 2019 revenue, a 9% increase year-over-year.Our interest offering which combined TruBridge with our EHR SaaS platform continues to build sales momentum. During 2019, we converted 10 EHR customers to nTrust packages and we expect to convert 16 existing customers to nTrust deals in 2020. We continue to refine our approach to cross-selling TruBridge services into our acute and post-acute EHR basis and to invest in reaching independent hospitals with less than 600 beds that don’t use CPSI EHR's.Our growing client base in this latter market is realizing real value from TruBridge services and we’re excited about our prospects here for 2020. With a total market opportunity of $400 million in cross sales and an estimated total addressable market of more than $1 billion in the net new hospital segment that we target, we’re increasingly confident about the long-term growth prospects for TruBridge over the next three years.One last important highlight from 2019 was our fourth quarter operating cash flows which reached an all-time high of $18 million and brought total year-to-date amounts to nearly twice that of 2018. This strength in cash flow allowed for further delevering [ph] during the quarter as we existed 2019 at close to two times leverage ratio. Now with leverage at a comfortable level and our expectation of continued strength and operating cash flows, we are in an enviable position in terms of available capital to deploy more opportunistically.The targets we set for ourselves in late 2017 namely of reaching 2.5 times leverage have been surpassed and there are ongoing discussions at the management and board level regarding our capital allocation strategy with an emphasis on driving shareholder value. CPSI remains focused on creating long-term growth and profitability for our shareholders. The drivers behind our confidence and the potential of long-term growth include; continued conversion of our EHR revenue to a subscription model, a total addressable market for TruBridge that is greater than $1 billion, a robust market outside the US including those opportunities specific to Get Real Health.And finally, a strong balance sheet and healthy cash flow that support a more opportunistic capital allocation strategy. With these drivers in mind, we expect to achieve a three-year average annual organic recurring revenue growth rate of 5% to 8%. We’re focused on growing recurring revenue as we seek to build a more stable and predictable business and meet customer demand for new services and contract arrangements.In particular, customer preferences have rapidly shift from license to SaaS with 12% of new EHR deals sold at SaaS in 2018, 43% in 2019 and more than 50% expected in 2020. This transition to a larger percentage of SaaS contracts will have a positive impact on recurring revenue, but will slightly suppress EBITDA margins in their near term.With that, I’d like to turn the call over to Matt.

Thanks Boyd and good afternoon, everyone. On today’s call I’ll provide a high level overview of the quarter including some additional detail on bookings performance, a brief walk through of our fourth quarter financial results and our outlook for 2020 and beyond. Boyd already shared some of the highlights for the quarter, strong bookings, increasing SaaS mix, continued growth in TruBridge and record operating cash flows.So let’s jump right into bookings; total bookings for the quarter of $27.3 million increased 15.5% both sequentially and over the fourth quarter of 2018. System sales and support bookings saw increases of 32% sequentially and 11% year-over-year both driven by the net new EHR category. Absent the impact from MU3 system sales and support bookings for $17.5 million our second highest mark of the past three years and within $100,000 of the $17.6 million of comparable bookings in the first quarter of 2018, the current high market.TruBridge posted yet another stellar bookings period arriving at $9.6 million, a slight reduction from the third quarter’s $10.2 million of bookings which were the second highest in company history and 24% above the fourth quarter of last year propelling this growth was $2.5 million of bookings from customers’ outside of our traditional EHR base with the patient engagement solutions from Get Real Health gain in traction and adding $1.7 million to the quarters bookings.Note that we have included information on the composition and revenue conversion time frames for quarterly bookings in the tables to the earnings release. So I won’t provide commentary on the call. Along the same lines commentary we formerly gave in our prepared remarks regarding the historical and net new derived acute care implementations will now be provided in the earnings release, so we direct you to those tables for the relevant metrics.With regard to near term outlook for this metric, we currently anticipate 10 new client facilities going live with our drive solution in the first quarter of 2020, with eight expected to go live in a Cloud or SaaS environment.Turning to the financial results for the period, quarterly adjusted EBITDA and non-GAAP net income measures were affectively in line with the prior year despite a 2% reduction in revenues driven by TruBridge growth and our cost control efforts. For the full year 2019, we managed to increase adjusted EBITDA by 4% and non-GAAP net income by 2% despite a similar 2% reduction in revenues.TruBridge posted results they were up 5% sequentially and 16% over the fourth quarter of 2018. The sequential improvement was driven by strong up sale for GRH’s patient engagement solutions which posted revenues of $2.7 million in the fourth quarter of 2019 compared to $500,000 in the third quarter. The strong GRH showing was slightly offset by lowered revenue contributions from the large AR work down opportunity we discussed at length on the last earnings call.Excluding GRH TruBridge revenues increased 5.6% over the fourth quarter of 2018, the volume declines for a few specific customers that we noted throughout the past year created $700,000 of headwinds against TruBridge revenue growth for the quarter, without these headwinds TruBridge would have posted 8.5% organic growth over the fourth quarter of 2018. TruBridge’s gross margin remains relatively flat at 49% during the fourth quarter compared to the third quarter increasing from the 43% margin during the fourth quarter of 2018, absent the impact of GRH TruBridge gross margins were 45% during the fourth quarter.Next, system sales and support revenues increased $500,000 sequentially, but decreased $5.8 million from the fourth quarter of 2018 as non-recurring revenues were pressured by the work down of the MU3 opportunity and the shift in lack in SaaS mix. As Boyd mentioned, our efforts to covert more of our new net EHR opportunities into recurring revenue arrangements have paid off, with the SaaS mix of 54% and 43% for the fourth quarter and year-to-date respectively compared to 8% SaaS mix in the fourth quarter of 2018 and 12% for the full 2018 year.Overall MU3 revenues decreased $2.9 million to only $200,000 during the past quarter while non-recurring revenues from net new implementations decreased $2 million. From a margin standpoint gross margin is 54% were relatively in line with the third quarter whereas the decline in non-recurring revenues and lower margin mix within those non-recurring revenues make for headwinds against the fourth quarter of 2018’s, 61% margins.Moving onto operating expenses, product development costs were flat sequentially and up 2% from the fourth quarter of 2018 mostly due to the addition of GRH. Sales and marketing cost were also flat sequentially but down 17% from the fourth quarter of 2018 mostly as commissions decreased with the decline in non-recurring system sales and support revenues. General and administrative cost were down $2 million sequentially and $1.5 million from the fourth quarter of 2018 mostly due to the planned design changes in our employee health benefits offerings intended to drive down cost while still providing competitive benefits to our employees and their families.Lastly, on the income statement our effective tax rate during the quarter was 12%. Going forward, we continue to expect an effective tax rate of 16% to 17% normalized for discrete items. Lastly, operating cash flows during the fourth quarter were just over $18 million. This record quarter was fueled by our stable yet growing recurring revenue base, coupled with the abatement of financing receivables headwinds that served the drag on cash flows from most of 2017 and 2018.Full year operating cash flows were almost double that off 2018 and represented nearly 90% of adjusted EBITDA for the year. This strength in cash flow allowed for a net reduction in bank debt of over $13 million for the quarter and $23 million for the year. The trends that Boyd and I have discussed strong bookings, increasing recurring revenues which made up nearly 84% of total 2019 revenues shipped towards SaaS revenues a stabilizing competitive environment and growing confidence in the opportunities for TruBridge and international have led management and the board to decide to reintroduce long-term targets and annual guidance.Our three-year outlook calls for average annual organic growth in recurring revenues of 5% to 8% driven by continued growth in TruBridge a third further shift towards SaaS EHR arrangement which we believe could reach as high as 80% over the forecast period as we work towards more moving exclusively to SaaS contracts and international expansion. For 2020, we expect recurring revenue growth to be towards the low end of that range and anticipate total revenue of $280 million to $290 million as they remain significant uncertainty about the near term pace of the SaaS mixed shift.On adjusted EBITDA margins although we previously stated a goal of returning to 20% margins by 2020, the near term impact of this shift in SaaS mix has caused us reassess near term adjusted EBITDA margins as a result, we envisioned 2020 margins to land within a range of 18% to 19%. But expect to work toward the 20% goal over the longer term. In terms of cash generation, we expect 2020 operating cash flows to represent roughly 80% to 85% of adjusted EBITDA.Finally, although we won’t be providing quarterly guidance, we expect next quarter to show a meaningful mismatch in revenue and expense recognition that will shift more profits to the remainder of the year. Headwinds from the lumpiness of GRH revenues and the 80% SaaS mix expected for net new Thrive go-lives will keep total revenues muted both sequentially and versus the prior year, while the seasonality of certain general and administrative expenses could result an incremental cost.In 2017, we shared our leverage target of 2.5 times following the Healthland acquisition. The strength in cash flows during the past year has allowed us to achieve and surpass that target with leverage near two times as of the end of 2019, with strong cash flow generation expected to continue for the foreseeable future and ample capacity under our existing credit facilities, we now have significant capital available to pursue more opportunistic capital allocation priorities. As Boyd mentioned, our board and management continue to monitor potential uses of our capital with an emphasis on driving shareholder value.At close, we’re proud of what we accomplishment during 2019 and excited for 2020 and beyond. We have a clear strategy for growth articulated by Boyd in his opening remarks and feel confident in our ability to deliver on our long-term targets with recurring revenues and adjusted EBITDA gradually increasing overtime.And with that, we’d like to open up the line for questions.

[Operator Instructions] today’s first question comes from George [indiscernible] with Deutsche Bank. Please go ahead.

I know you guys aren’t going to explicit Q1 guidance, but is there any way to kind of frame up or put some goal post around the mismatch between the flat revenue that’s expected in Q1 versus Q4 and year-over-year versus the expense pull forward?

Yes, so George thanks for joining us on the call. The mechanics of our 401k [ph] match program result in very little expense in the fourth quarter of every year, that with legal and accounting fees which receives [indiscernible] time year of our audit, proxy season, vacation utilization is always a bit of tailwind to the fourth quarter which makes for a tough comp moving into the first quarter of every year. So those three items should result an incremental G&A cost somewhere between $2 million and $2.5 million.

Okay, that’s super helpful and then I guess maybe just because you guys provided a little bit of long-term growth guidance. It sounds like 2020 is going to come in at the low end of the long-term growth target and kind of accelerates beyond 2020. I guess the two questions I would ask is, number one, what should we think is the pricing component of long-term growth particularly as it relates to TruBridge services business and I guess, is there anything that you’re seeing that kind of gives you the comfort that 2021 picks back up given, it looks like it’s going to be a little bit of softness in 2020. Thank you.

Yes, the primary reason that 2020 is guided George towards the low end of three-year recurring revenue target is the increase in SaaS mix going from 18, 19 and then more prolifically in 20 and then we expect that rate to continue or even accelerate in 21 and 22, so as we build up those recurring revenues from the new sales to come to be a SaaS as oppose to previously 80%, 90% we’re licensed, that will give us the tailwind to have better recurring revenue growth in those outer years.

Maybe I’ll just ask one more Boyd, if you don’t mind. It’s just – kind of where are we now in the SaaS mix versus the license mix.

George this is Matt. I think we mentioned in the opening remarks that for the fourth quarter we came in 54% SaaS mix which is a big shift from last year and I think last year in the fourth quarter, we were somewhere closer to around 12% SaaS mix then we take a look at bookings overstate that the past 12 months, it really does look like from a booking standpoint, what’s in the pipeline right now that closer to that 50-50 split with a slight lean more towards the SaaS arrangement is kind of what we see going forward, so to that point, we do see this is being kind of similar [ph] moment in CPSI’s history that this is here and is permanent and it should only increase going forward.

I’ll add to that George, again this is David. We expect as Boyd mentioned in his prepared comments, we expect to increase the nTrust sales into our current customer base from 10 in 2019 to 16 in 2020 which will help accelerate the ability for us to grow that recurring revenue in 2021 and 2022 as well.

I appreciate the color, guys. And Matt, that’s my bad for missing that number in the prepared comments. Thanks.

And our next question today comes from Jeff Garro with William Blair & Company. Please go ahead.

Maybe a couple more from me on the long-term outlook. Your point is to arrange for the recurring mix, so little bit more color on the non-recurring portion maybe a total dollar amount or a percent of revenue that you expect that to hit and then either be sustainable or whether you expect it to deteriorate further on a go forward basis?

So over three-year horizon I don’t think we quite want to zero in on exact dollar amount, but as far as the overall mix in revenue, we take a look at 2019. We came in right around 84% recurring and what we see over the three-year horizon is that increasing to anywhere to between 87% to 89% by the end of the three-year timeframe.

Great, that helps. And then maybe to add some layers to the margin discussion you talked about the near term dynamics in 2020 and then continued in March towards 20% longer term. Again thinking about the non-recurring piece just want to hear a little bit more from you, on how volatility in that non-recurring piece might impact the progress towards your long-term margin goal as we think beyond 2020.

Yes so, the volatility with the non-recurring piece to certainly a part that here with us until we’re 100% completely away from this perpetual license model that we’ve seen, but going forward. We certainly see the evidence that there’s definitely more of a tilt towards SaaS mix which should alleviate some of that volatility, but you’re right some of that is still here with us and the lumpiness is going to be here to stay until we reach 100% SaaS.

Great and one more follow-up from me on the margin front. If we do focus on the recurring portions of the business that subscription, software piece and the TruBridge piece and combined together entrust in some circumstances. How can we think about the scalability of that part of the business and as it grows, as you turn more efficient ability to expand gross margins for that recurring piece of the business?

The ability to expand margins towards the high end of that range and then into the 20s and perhaps slightly above it does increase significantly especially once we get past this kind of three-year horizon that we’re looking at right now. The unintended consequence of this shift to SaaS is that, in the short-term at least and over this three-year term we will see a dynamic unfold where this high periodic margin non-recurring is obviously going to replace with this higher long-term value recurring revenue from SaaS, the two to three-year mix, it may actually end up being slightly neutral on a three-year timeframe, the further we get out on that timeframe the higher the margin profile increases.

Got it, that helps. Thanks again for taking the question.

Our next question today comes from Jamie Stockton from Wells Fargo. Please go ahead.

I guess maybe the first one, I think it was in Boyd’s prepared remarks about the competitive dynamic kind of changing a little bit and you’re seeing a little better pricing as a result, is that really just a comment on Athena not being as present in the marketplace outside of them, should we assume that things to remain relatively stable?

Jamie, David here. I would say 80% plus of the way you framed your question is affirmative, yes. It’s primarily Athena is actually from competing for new business. We alluded to this on the last call as well. It also appears to us that Cerner is less interested in the small hospital space at this point and we’ve kind of seen them move in and out of the market over the last several, but you know there’s a lot going on I think in their market, so we’re not seeing as much activity from them right now either, that remains to be seen, whether that continues.

Okay and then just a couple more quick ones. So TruBridge it sounds like there was a lump of Get Real Health revenue in Q4 and I know George already kind of touched on what your expectations were sequentially in Q1, but how should we think about line trending maybe that one-time revenue from Get Real Health going away on top of that, do we see seasonality that maybe brings the core TruBridge business down a little bit sequentially just anything there would be great?

So Jamie on the – at least in terms of the next 90 days, there will be some headwinds from the non-recurring revenues from GRH, but over the long-term or 2020, we definitely see the pipeline growing there. There’s a lot of top side for 2020 and we just reiterate that this is still relatively subscale business that has yet to reaching we’re close to maturity and we think about the sky is the limit as far as what we can do there.

To add on, Jamie. The TruBridge bookings that we had in the back half of 2019, our turn to return from bookings is typically about six to seven months with TruBridge and so we’ll start seeing a lot of those in the first half of 2020. The job now obviously is to continue with that strength going into the first half of 2020 and with the pipeline. The way it is, we feel confident we can do that. We really have had a good deal of success in the back half of 2019 that we think we can continue with regard to TruBridge sales into non-CPSI EHR facilities especially in that sort of 100 to 400 acute-care space that sort of [indiscernible] sweet spot and we look for that to continue.

And then Matt kind of [indiscernible] my last question a little bit, but as far as Get Real Health is concerned and kind of what you guys have articulated for 2020. I mean, how conservative or aggressive do you feel like you’ve been for what you’ve built in for it, maybe compared to what it did in 2019?

Yes, so Jamie. Definitely we have a live range of expected outcomes for GRH, just given the lumpiness of the business and the size of the opportunities that are out there. Holistically when we take a look at the revenue range that we gave for the year, you’ll feel like that we’ve appropriately accommodated that uncertainty with the range that we provided.

Okay, thank you.

And our next question today comes from Sean Wieland with Piper Sandler. Please go ahead.

Might have buried in your prepared remarks, so I might have missed it, but what was the full year revenue and EBITDA contribution from that business and how much of that was one-time versus I think it was all one-time.

Hi Sean, the fourth quarter revenues for GRH were about $2.7 million with a quarterly adjusted EBITDA of $1.3 million from GRH that brings the full year impact of GRH to $3.4 million of revenue and effectively neutral to adjusted EBITDA and we ended the year with the recurring versus non-recurring revenue split of actually about 50-50.

Okay and why wouldn’t that business continue to skew more towards recurring, is there something unique about that, that will prevent that.

So the licensing model there is primarily through resellers and it’s primarily up selling through existing customer arrangement, so we already have in place that have perpetual contracts in place. While we do see the opportunity potentially down the road to push more SaaS or subscription type revenues these up sells to existing customers kind of follow that, the existing contract [indiscernible] kind of the explanation for at least the historical results that we’re seeing so far.

Sean, David here. More than half of the opportunities that we have, the significant opportunities that we have in the Get Real Health pipeline right now primarily around nationalized healthcare system that want to rollout patient engagement platforms to their population, consumers or the ORP [ph] is calling for a SaaS model, so we do expect that similar to our EHR business that Get Real Health will transition overtime to more of a recurring revenue mix.

Okay, thanks for that and your comments around deploying capital. Is Get Real Health kind of a template to use going forward or you’re thinking about doing something bigger? What’s most important to you when you’re evaluating potential in organic opportunities?

One of the things obviously tuck-in opportunities as one things we’ve talked about in the past, but also from a capital allocation perspective everything frankly is on the table whether it’s stock buybacks or again there’s more tuck-in opportunities and there’s a variety of things that the board and management are looking into for that especially with the cash flow that we’re expecting this year.

I’ll follow-up on that, as Boyd and I both commented on our prepared remarks and we do consider ourselves to be in enviable position when it comes to capital allocation right now and that’s a situation that’s changed a lot over the last say 2.5 years. Right now nearly two times leverage, we have the debt capacity to lever up and determine half of EBITDA and remain in good standing and [indiscernible] bank grew and that equates to around $75 million of capital. You add to that our considerable operating cash flows which because we’re not capital intensive effective equals free cash flow, it’s understandable that we’re considering all options.We continue to think that tuck-in acquisitions, the complementary enhanced. Our product and service offerings will continue to play a role. But we also have to make sure that we’re disciplined with any future M&A activity that we pursue and other options that the board and management continue consider and with the share repurchases assuming that the evaluation makes sense.

All right, thank you very much.

Our next question today comes from Sandy Draper with SunTrust.

This is Stan Holtz for Sandy, thanks for taking my questions. Maybe a quick one on TruBridge. I’m just trying to understand [indiscernible] someone outside the CPSI installed base to use TruBridge and then maybe specifically looking at the 200 to 500 bed hospital market since typically that cohort will have EHR vendors that already have are same [ph] offerings.

In large part they don’t have EHR vendors, at least in our view that have the offerings and we now have customer, we have Meditech customers, Epic [ph] customers, Cerner customers where we have – where we manage the entire business operation through our cancer field management program. So we’ve got referenceable [ph] clients and as we know that the trend slowly continues to shift towards the hospital is focusing solely on patient care as the reimbursement model changes and want it outsourced anything that doesn’t have to do with that clinical care focus. So as that occurs, we’ve essentially increased our sales capacity in that space that you just mentioned about 2.5 fold in the last 12 months. So our sales coverage has increased, the awareness of TruBridge is someone that operates efficiently in the market continues to increase with our referenceable base and so the opportunity is there and we’re capitalizing on it.

Great, thank you.

And our next question today comes from Eugene Mannheimer of Doughtery & Company. Please go ahead.

Congrats on the strong finish to the year. I wanted to ask about the trend you’re seeing toward the higher SaaS mix as you called out Boyd and Matt that’s much more pronounced than in prior year. I guess I’m wondering how much of that is driven by CPSI the vendor pushing that approach versus the preference of the client. And then separate question, can you just remind us the revenue thresholds that needed to be attained for the Get Real Health earnouts to kick in?

I’ll handle the first part of your question, Eugene this is David. Matt will handle the second. We have been offering the SaaS mix and the perpetual license mix and now the nTrust. The SaaS mix and the license mix for five years plus and add the nTrust mix to that for about the last 15 months or so to all of our clients. We’ve present [ph] them with menu of options and we continue to do that. So I would say, would be a bit of a stretch to say that CPSI is responsible for the pushing of the mix more towards SaaS. Although there’s a certainly probably a bit of that, we have incentivized our salesforce to increase the SaaS mix as much as possible so there’s a lean in on their part towards that, but we want the customer to have the choice.I would say that it’s very likely that Athena [indiscernible] entrée [ph] to the market, aggressive as you know and the awareness of them and their model moving from the [indiscernible] space with the [indiscernible] space with the SaaS model increased the awareness of that and perhaps the popularity of that and we’re capitalizing on that now.

And Eugene, the second part of your question around the performance of GRH versus the earnout levels, is that right?

Yes.

Yes, so we stated earlier that adjusted EBITDA for GRH for the year ended up being relatively breakeven and 8-K that had the purchase agreement. I believe the step on for the earnout was somewhere around $3 million of EBITDA, so feel short of that so the earnout doesn’t look like it’s going to be achieved and it’s now good time to explain something that you all likely see on the face of the income statement and that’s a $5 million gain from contingent consideration and when we acquired GRH, we estimated the fair value of the earnout clause based on a probability weighted scenario analysis and the end result of that analysis was in purchase accounting, a $5 million increase to purchase price and GAAP requires any adjustments to those determinations down the road run through the income statement if there’s adjustments happen outside of the measurement period. So any questions about that $5 million or specifically related to the earnout not be considered earned.

Got it. Thank you very much.

Now ladies and gentlemen, this concludes the question-and-answer session. I would like to turn the conference back over to Mr. Douglas for any following remarks.

Great, thank you Rocco [ph]. In closing I would like to welcome Chris Hjelm to the CPSI’s Board of Directors. Chris has an extensive and impressive background in technology and innovation bringing to us over 25 years of experience C-Level technology leader. He recently retired from The Kroger Company where we served as Executive Vice President and Chief Information Officer. We look forward to working with Chris as his previous IT leadership experience will contribute greatly to our evolution as a leading community healthcare solutions company.And lastly, I would like to take a minute to thank all of the employees of CPSI. All across the country. They work hard to help us make a difference as we continue on our journey of advancing community healthcare. Their commitment and passion make a real difference everyday and their efforts are very much appreciated not only by me, but most importantly by our clients. With that I’d like to thank everyone for taking the time to join us on the call today and everyone have a great evening.

Thank you, sir. Today’s conference has now concluded. We thank you all for attending today’s presentation. You may now disconnect your lines and have a wonderful evening.