Good day, ladies and gentlemen, and welcome to Asure Software's Corporate Conference Call. My name is Eric, and I will be your coordinator for today. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to turn the call over to Cheryl Trbula of Asure Software. Please proceed.

Thank you, Eric. And welcome, everyone, to Asure Software's conference call. Before we start, I'd like to mention that some of the statements made by management during this call might include projections, estimates and other forward-looking information. This will include any discussion of the company's business outlook. These particular forward-looking statements and all of the statements that may be made on this call that are not historical are subject to a number of risks and uncertainties that could affect their outcome. You are urged to consider the risk factors relating to the company's business contained in our latest periodic reports on file with the Securities and Exchange Commission. These risk factors are important, and they could cause actual results to differ materially. This call is also being recorded on behalf of Asure Software and is copyrighted material. It cannot be recorded or rebroadcast without the company's expressed permission, and your participation implies consent to the call's recording. After we've completed our review of the quarter, we'll open up the call for questions from the financial analyst community. I would now like to turn the call over to Pat Goepel, CEO of Asure Software. Pat?

Thank you, Cheryl. And I'd like to personally welcome everybody to the first quarter conference call. All employees, clients, investors and interested third parties that are on the call today. First quarter 2014 was an eventful quarter. We had improvement in revenue, gross margin, net income, EBITDA, net loss per share, really every major category we had improvement, and that's the hard work from our employees and the planning process that we put together. First of all, I'd comment on bookings. Bookings were up 5% over our first quarter, seasonally tough compare. Some key wins, Stratus Solar and AsureForce, NASCAR and we're revving up our engines to implement them. IET, over in New Zealand. Mondelez, and that was a global account for us. PDLC ben [ph], Interserve, which was a European account. So we had a diverse set of key wins, and we're active in our conversations around bookings. Salespeople are off to a busy start and we -- this year, did not hire salespeople. We're flat with last year, and we're going to continue that sales headcount at approximately 35 all year. Revenue was up 9% or so, and we were pleased with the revenue -- cloud-based revenue was up 8%. The product enhancements that we had, we are in the middle of rolling out our double bite [ph] product, and we do have some Asian customers that are going to go live in the second quarter on the double bite product. We have expansion in the Southeast Asia. From a product perspective, we are rolling out key product enhancements, especially around Mobile and the integration of the IPanel enhancements, and that will help our hardware going forward, not only with GeoPunch, but also with AsureSpace integrated hardware sales. We have a Net Promoter Score of 92% in the first quarter. That's been up, and that's a key metric to measure our client satisfaction. On client satisfaction, Scottish Water did a video and we press released that a couple of days ago. That has been playing at some facility management conferences in Europe. I think it tells a great story. Heavy ROI story, and what we can do with our clients that affect their business. So we're proud of that. Finally, we had a couple of major events in the first quarter. Wells Fargo, we refinanced and that has been previously press released, but going forward, that'll save us over a couple of hundred thousand dollars a quarter. So we're very pleased with that refinancing effort. And then finally, we had an acquisition on July of '12 with PeopleCube, and we settled the remaining payout. And that was about $1 million gain or so in this quarter. So a lot of activity sets us up very well for the future, and we're very pleased with the activity and accomplishments this quarter. With the specific numbers and some color, I'm going to turn it now over to Jennifer Crow.

Thanks, Pat. Good morning, everyone. I'm going to take a few minutes to go over the first quarter financial highlights, and then Pat and I will be happy to answer any questions during the Q&A period at the end of this morning's call. In the first quarter, revenue was at $6.5 million, up from $6 million or 9% year-over-year. In line with seasonal patterns, typically associated with this quarter, first quarter revenue was down $206,000 or 3% from the $6.7 million reported in the previous quarter. The year-over-year increase in revenue of $552,000 is split amongst cloud, revenue, hardware and professional services revenue, as we continue to emphasize our integrated cloud-based solutions. Cloud revenue increased $236,000 or 8% over the first quarter of 2013. Hardware revenues increased $132,000 or 29% over the first quarter of 2013. Professional services revenue increased 247% or 49% on-prem revenue, and maintenance and support revenue decreased slightly by $44,000 each, or 17% and 3% respectively over the first quarter of 2013, as we continue our transition to a SaaS-based revenue model. AsureSpace revenue was $3.9 million, an increase of $662,000 or 21% from the $3.2 million recorded for the first quarter of 2013. This increase is primarily due to an increase in crowd -- cloud revenue, hardware revenue and professional services revenue. AsureForce revenue was $2.6 million, a decrease of $110,000 or 4% from the $2.8 million recorded in the first quarter of 2013. This decrease is primarily in legacy iEmployee cloud revenue and Legiant hardware revenue. Recurring revenue as a percentage of overall revenue was 76% compared to 75% last quarter, and 79% in the quarter -- first quarter of 2013. EBITDA for the quarter was $1.14 million, excluding one-times. We incurred $396,000 in one-time items, which were related to the loss on the debt refinancing, the gain on the settlement of the notes payable in litigation and legal and professional fees. Net loss, excluding one-times for the first quarter was a loss of $0.02 per share. GAAP net loss per share amounted to a loss of $0.09 per share. The difference is $0.07 per share and is due to the one-time items. Gross margin for the quarter was $5 million, up $771,000 or 18% higher year-over-year, and down $100,000 or 3% from the previous quarter. Cash flow from operations for the quarter was $71,000, CapEx for the quarter was $168,000. We are maintaining our 2014 guidance, and expect to be within the range of $29 million to $30 million in revenue, and EBITDA excluding one-times between $5.5 million and $6.5 million, and net income per share of $0.08 to $0.24. At this time, I'd like to turn the discussion back to Pat Goepel, our CEO, for closing comments, and then we will open it up for questions. Thank you.

Thanks, Jennifer. I hope you can appreciate the improvements in all categories over the first quarter of 2013 -- 2014 first quarter was eventful. We met our plan, accomplished a lot and set the business up going forward. As it relates to 2014, we are active, working to plan everyday, and we'll give you updates as each quarter passes. We thank you for your interest in Asure, and thank you for your investment. And now, we'll turn it over to questions that you may have.

[Operator Instructions] And our first question comes from Jeff Houston of Barrington Research.

To start off with, I was hoping you can provide an update on the 35 salespeople. Could you talk a bit about how they're ramping? And when you expect them to be at full productivity?

Well, great question, Jeff. First of all, we're very pleased with the training of the salespeople. We have them working every day on product training as well as customer interaction. I think the sales force that's working with the customers on the base is ramping ahead of the new sales training. And then we do have some seasonality in our business in sales. So to -- as I look at it, we should be at full productivity in the third, fourth quarter of this year. And we're very optimistic on base sales, and feel like the salespeople have hit their stride in that area. On new sales, we have some more work to do, and they're meeting the challenge head on. And we'll see their improvement throughout the year.

Great. Then following up about seasonality in the business, because on the surface, it looks like SaaS bookings and revenue growth declined pretty meaningfully on a sequential basis, yet you maintained full year guidance. Should we expect growth to gradually ramp as we go through the year, or is it more of a step function going into the fourth quarter? Any color there would be great.

Yes. There is some seasonal revenue in the third and fourth quarter, and it could be anywhere from days in a quarter where first quarter is 5 -- or 5 days less than the second and third quarter to also, the clock starts at 0 on January 1. So if you're going to implement some clients, et cetera. And then there's some Billings as it relates to that, whether it's a once-off annual billing or a quarterly billing, sometimes in the fourth quarter. So there's some seasonality as it relates to that. There's some seasonality as it relates to bookings. But the peer base of cloud revenue is about what we expected, and we'll continue to grow especially in the third and fourth quarters from here.

Got it. And then along the same lines, how should we think about seasonality with adjusted EBITDA, cash from operations and CapEx on a quarterly basis as we go through the year?

So I think from a cash flow perspective, typically, we draw more cash or get more cash as we go throughout the year. It could be employer taxes in the first quarter of the year, et cetera. We'll hit. Now that we've settled the PeopleCube dispute, that is going to be a cash flow positive going forward. The peer refinancing with Wells Fargo will be -- it'll save us quite a bit of cash going forward. So I think we feel really good about our cash position. Going forward, feel really good about some of the work that we're going to do, seasonal work around implementations in the third and fourth quarter, and that typically is a cash flow positive event. So a number of these metrics. And then on capital expenditures, we're not a high capital expenditure business. So I wouldn't think that we would have a lot of capital expenditures outside the 2 events that we talked about, which is the settlement and the refinancing.

[Operator Instructions] And our next question comes from Matthew Paul of Sidoti & Company.

Could we revisit the major deal that you guys touched on today? And speak on the effort to expand within your larger clients? And any color on the deals from this morning? I just kind of missed on the first time aroundif they're within your present client base already.

Well, if I showcase a couple, maybe Mondelez. Mondelez is a spinoff ultimately, I guess, from Phillip Morris or Kraft Foods. They're looking at expanding their offering from a conference room to -- or a location to the cloud. And so -- a, they're going from hosting their own software to hosting it with us or us hosting it. Two, there's integration of panel or hardware within that component, so their employees can quickly see which conference rooms are being shown or being busy, or not busy and they can book right on the conference room door, if you will. Also, geographically, they're looking at expansions. So not only in the U.S. but when they have other areas in the country or, excuse me, the world, they can use our offering. So they can use our offering ultimately in every location they're at. So that's an example of some of the work that we've done for Mondelez, as well as for our other locations. Stratus Solar was an interesting customer as well. They had some people, and if you picture solar farms or solar, example, you have people that are literally outside, and they're looking to punch in for work. And we're looking to capture on behalf of Stratus Solar their hourly workforce. And so they need a mobile device or a panel device to be able to punch in and collect the time, and we're able to provide that service for them. So that's at the multiple centers that they have. NASCAR, they have events at each city, and especially in the summer, each year, they have a number of different mobile workers for their events. And they're going from town to town with a lot of enthusiastic people, and we are able to help them capture time. So those are some examples of what we can do for clients, and have sold this past quarter.

Right. So is NASCAR a first-time customer in 2014, or are they repetitive from last year, is what you're saying?

They're repetitive, but an expansion customer of our new capability.

Got you. So it's fair to say the land and the expand strategy is still the driver in this growth machine?

Yes. I think land and expand, I mean, we feel very good about what we're doing in the programs that we're offering, and we think there's tremendous opportunity.

Great. And to touch upon the geographic on that, in your answer. Can you touch a little bit on some of the global expansion you highlighted in your press release? And maybe some of the resources you've recently allocated to different territories here?

Well we're -- with the PeopleCube acquisition, we have a London office, and they're doing a very nice job. When we looked at the London office, and we looked at the expansion possibilities, we have noticed that the countries that our London office is serving was far more than England. We had some expansion last quarter in Switzerland, and with Salesforce.com and we have now, I think, 17 clients in France. And we've been able to expand, and we have localization of language as an opportunity in the future. But really, we're going there with English speaking software, and our software companies are looking for common systems. They don't want to manage 3, 4, 5, 6 different systems. They want one vendor to approach. So we go where our customers tell us to go. We go in a profitable way, and we go there in a way that we can open a country but we can also expand it using our infrastructure. So we're trying to be thoughtful about how we do that, but we are also trying to expand with our clients. And we've grown quite nicely over the years, and the PeopleCube acquisition was a key beachhead in Europe, and now we're trying to do the same beachhead here in Asia, whether it's New Zealand, which we did with IDT, and we're working with them on a hosting relationship in the future, as well as Asia with some of the bigger clients.

Okay. And the last question. It sounds to me like the seasonality here was just yearend budget, like you said, with dollars to burn. Is that just the biggest thing you guys have in the third and fourth quarters, is it going to be budgeted in the first and second here?

Yes. Typically, if you look at some of our past history, fourth quarter is usually a big quarter, and there's some one-time billings and catch up billings and implementation billings that we do in the fourth quarter. And then what I think you'll see is an improvement, much like last year in the revenue from the first quarter, second, third, fourth. And I think you'll see that progress throughout the year.

Our next question comes from George Melas from MKH Management.

Quick question on looking at the 2 businesses. Seems like Force, at least on the revenue basis -- Space, did extremely well. Force was down a little bit. I think this impact, you mentioned the impact of the legacy iEmployee. Can you try to quantify that? And maybe talk a bit about the growth opportunities within Force?

Well, I think Force has huge growth opportunities in the future with mobile devices and what I call white-collar devices. I think traditionally, it was blue collar, time and labor management. We see more opportunities in the future with white collar. There are some seasonality to the AsureForce business around fourth quarter, and when you have implementation, you bill some one-time revenues or you have some billings in the fourth quarter. We anticipate AsureForce being a growth area of the business. I would say, we do have a little bit more legacy business, so iEmployee was a product that we have legacy clients that we're not chasing new sales, if you will. So that customer base is a legacy base that we don't try to grow consciously. We try to do a great job for our clients, keep them and make sure that they stay with us. But most of our future development is starting to be on the new products. And so when we look at growth opportunities going forward, it's AsureForce on the new products. As far as quantification, we don't break that out. We're just starting to break out Force and Space over time. We'll give more and more color but right now, we don't break that out.

Okay, great. And I think, I hope I'm not beating a dead horse there, but on the guidance, it implies sort of a significantly high growth rate. So it's just your high growth rate than you've had in the past. This quarter, I think your growth was roughly about -- was 5%. I think your guidance sort of implies an acceleration in the growth rate. What makes that -- what gives you the confidence that this could happen?

Yes. I think when we look at guidance, first of all, we had quite a bit of improvement last year. We expect the same type of improvement this year. If we don't get that, certainly we'll let you know. But we do believe that we have more seasoned salespeople. We feel like we have a good reoccurring base, and we have to continue to execute each and every day. And we're going to do that, and we also are talking to a number of different big opportunities. And if we get those, great. And if we don't, we'll let you know. But we do feel that some of our conversations warrant that type of guidance.

Okay. And these opportunities, Pat, are they both in Force and Space?

They are. I would say, they're worldwide. They're Force and Space, they're mobile, they're integrated hardware. And we're -- we've gone from a turnaround to a growth story, and now we are in a growth story. And we have to execute and that's very important to us. But we are in conversations that typically, we haven't been in. Now, we're new to this as far as the growth story. So we do have to execute and that's important. But we feel good about the opportunities.

And that was our final question. I'd like to turn it back to Pat Geopel for closing remarks.

We're very appreciative of your investment and interest in Asure. Asure has been a -- as I mentioned, a turnaround and growth story. We've largely now delivered on our turnaround. Our first quarter was solid in improvement in all the major areas. We have to continue and drive for improvement going forward. We are focused on it as a management team, employee team. We feel like we're doing great things. I'm very pleased with our product and service levels. And now, we're turning our attention to growth. And growth is important for us going forward, and we feel like we have a good story. And we're glad to be able to share the journey with you all today. Have a great day, and thanks for your interest in Asure.

Ladies and gentlemen, thank you for your participation in today's conference. This concludes the presentation. Thank you, and have a great day.