Good afternoon, and welcome to the IDT Corporation's Second Quarter Fiscal 2014 Earnings Conference Call. [Operator Instructions] In today's presentation, IDT's Chief Executive Officer, Shmuel Jonas, will discuss IDT's financial and operational results for the 3-month period ended January 31, 2014. Any forward-looking statements made during this conference call, either in the prepared remarks or in the Q&A session, whether general or specific in nature, are subject to risks and uncertainties that may cause actual results to differ materially from those which the company anticipates. These risks and uncertainties include, but are not limited to, specific risks and uncertainties discussed in the reports that IDT files periodically with the SEC. IDT assumes no obligation either to update any forward-looking statements that they have made or may make, or to update the factors that may cause actual results to differ materially from those that they forecast. In their presentation, or the Q&A, the IDT's management may make reference to non-GAAP measures, adjusted EBITDA, non-GAAP net income and non-GAAP EPS. A schedule provided in the earnings release reconciles adjusted EBITDA, non-GAAP net income and non-GAAP EPS at the nearest corresponding GAAP measures. Please note that the IDT earnings release is available on the Investor Relations page of the IDT Corporation website, www.idt.net. The earnings release has also been filed on a Form 8-K with the SEC. Finally, please note this event is being recorded. I would now like to turn the conference over to IDT's Chief Operating Officer, Shmuel Jonas.

Thank you very much. This is my first earnings call since IDT's Board appointed me as a CEO, and I'm honored and humbled by it. I've had the best mentors that one could hope to have, not only while COO but throughout my life. I'm also blessed to be working with some of the talented, energetic and knowledgeable colleagues here at IDT. My remarks this quarter will focus on a few key operational results and our business strategy and expectations. For a more comprehensive picture of our financial results, I urge you to read our earnings release in its entirety and when it is filed, our Form 10-Q. Following my remarks, Marcelo Fischer, our Senior Vice President of Finance, as well as Jonathan Reich, from Zedge and I will take your questions. IDT has delivered steadily improved results over the several years, and this quarter was in line with that trend. Adjusted EBITDA increased year-over-year and sequentially to $11.3 million, and for the first time in our recent history, adjusted EBITDA for the trailing 12 months topped $40 million. Starting with our telecom business, we continue to drive growth in Boss Revolution voice sales, which increased 27% year-over-year and 3.6% sequentially. The increases reflect continued growth in the size of Boss Revolution's current customer base and the number of active U.S. retail locations, both of which reached new heights during the quarter. We increased U.S. retail locations by 5% sequentially this quarter and are now up to approximately 37,000 active retailers. Our customer base grew by more than 1/3 year-over-year and by 12% on a sequential basis. Nevertheless, Boss Revolution's voice service is clearly becoming a mature product in some key markets, while facing intensifying competition in others. The sequential increase also reflects in part the modest bump in traffic…

[Operator Instructions] Our first question comes from Jay Srivatsa at Chardan Capital Markets.

Shmuel, you mentioned the rate changes in South Asian countries. Can you expand on that? Is this something that you see ongoing? Or is it more like a one-quarter phenomenon? Help us understand that and how you hope to battle it going forward?

You know, it's not a one-quarter phenomenon. I mean it happened last quarter, as well. But again, as I stated in my remarks, it could go on for a while or it could end abruptly. I mean it's still continuing as we speak.

Okay. And then, typically, Q2 you see a little bit of improvement in your revenue line that didn't quite happen this quarter. Was it because of these rate changes? Or were there other factors in play?

It had -- it did have, it somewhat had to do with rate changes. I mean rates continue to go down to most destinations. But it also had to do with I mean weakness in traditional prepaid calling cards, as well as sales in Europe.

Okay. Can you talk also about the disparities in currency exchange? Is there a way for you to hedge against this set going forward? Or is it something you just start to play by ear quarter-over-quarter?

I'm going to let Marcelo answer that question.

Yes. The changes in foreign currency exchange that you saw affecting the P&L are mostly to do with the fact that IDT purchases most of our minutes in U.S. dollars with our U.S. entities, and then we sell those minutes to our various subsidiaries across the globe. So those subsidiaries in foreign countries usually carry a trade payable, and the company trade payable, with IDT in the function of currency. And when they have to revalue the numbers for reporting, they -- now in a situation like in the past quarter, where you saw many of the foreign currency like for example the Mexican peso, the Brazilian real was down about 9%, the Argentinian peso was down about 26%, 27%, the Euro was down a little bit, also the U.S. dollars. So when you revalue those currencies, those payables in the balance sheet, that figures a foreign exchange transaction loss for accounting purposes. And we usually don't try to hedge this type of accounting movements. We'd like to focus our hedging on cash flow movements.

Okay, in terms of your Payment Service, how has the reception been so far as you start rolling out in certain areas? And what are some of the challenges as you plan on a more nationwide launch?

I mean I think everything has challenges in terms of scaling it. I mean right now, we're still in the process of making sure that we're doing it right, those in terms of how the customer experience is, how the retailer experience is, how it affects -- how the cash pickup is in a foreign country, how our reporting is handled, et cetera. And so far, we've made a lot, a lot of progress on that front, to the point that this weekend, we didn't have any problems at all. Everything's sort of flowed perfectly. And now it's going to start to be about really building it up as quickly as we can. And again, we're going to launch aggressively in 2 states in the coming quarter, and you'll hear a lot and see a lot more about money remittance and going forward.

Okay. And then last question for me, I know you don't give guidance, but looking ahead to the next quarter and for the rest of the year, you expect to be able to achieve the EBITDA growth and/or net profit -- gross profit growth? Or do you see further challenges in terms of some of the rate changes and stuff affecting your business, near-term?

I mean I'll answer it a little bit, but I'll also let Marcelo answer that. I mean currently speaking, I don't see any major challenges. But we live in a very competitive market, and we -- you never know what next month will bring. But I mean, so far so good.

Yes, Jay, a few things to consider as you think ahead for our Q3 and even beyond. Number one, as you probably know, Q3, which includes the month of February, if you leave out only quarter of the fiscal year that has usually 89 days as opposed to 92 days, so it's a 2% reduction in the number of business days. And therefore, by definition, you should expect on the daily average to be smaller because of less days. That being said, even though we have seen revenue per minute to a lot of destinations to be lower because we have been targeting a lot more some of the lower revenue per minute destinations, when it comes to gross margins, and therefore to EBITDA, a lot of these lower revenue per minute destinations in actuality actually generate for IDT higher per minute profits. And so both on the whole, primarily on the wholesale telecommunications services segment, and even to some extent on our retail segments. Even though you see the revenue being impacted a little bit by the rate shifts, when it comes to gross margins, gross profits, we have been seeing expansion of those of the profitability. Because at the same time that some of the revenue per minute might be going down, our carrier group in trying to buy and purchase our domination minute have been quite aggressive and successful in lowering our cost per minute domination, so that net-net we have seen an expansion on the profit per margin, on the profit per minute, overall. So we believe that those gradual will likely continue, that the gross profit will continue to be at the same level so we could see some expansion in it. And therefore, that translates into EBITDA growing over time because at the same time, we are keeping our SG&A very much in check, and basically our SG&A has not grown much at all in absolute terms as the business has grown. So all of those statuses should be okay, for us in 2014 ongoing profit.

Our next question comes from John Rolfe at Argand Capital.

Just one clarification. The $3.1 million of other expense, below the operating income line, is that all related to the foreign exchange payable translation that you referenced earlier?

Yes. It's predominantly the FX on revaluation of the company balances.

Okay. Okay, great. And the 2 states that you plan on launching the money remittance in, I heard you mentioned you mentioned Texas. What was the other one? Is it New Jersey?

No, Illinois.

Okay, so Illinois and Texas. And where have you been beta testing to-date?

We have done Florida, New Jersey, Connecticut. Those are the 3 that I know of off the top of my head.

Okay, but are those states also going to be...

Yes. Those states are also going to go live, but we view that Texas and Illinois are particularly attractive for us. So those are going to be our like most aggressive ones, even though we're going to continue expanding retailers, obviously, in the other 3 states.

[Operator Instructions] This concludes our question-and-answer session, and it also concludes today's conference call. Thank you for attending. You may now disconnect.