Hello everyone and thank you for standing by, and welcome to DropCar’s Third Quarter Ended September 30, 2018 Earnings Conference Call [Operator Instructions]. After the speakers’ remarks there’ll be a question-and-answer session [Operator Instructions]. At this time for opening remarks and introductions, I will turn the call over to Mr. Paul Commons, our Chief Financial Officer. Paul, please go ahead and start the conference.

Thank you. Welcome and thank you all for joining us. On today's call, we will review our third quarter September 30, 2018 financial results and provide a corporate update. Our update will include details of our business developments and prospects. And the prepared remarks will be provided by Spencer Richardson, our CEO. Before turning the call over to Spencer, I would like to make the following remarks concerning forward-looking statements. All statements in this conference call other than historical facts are forward-looking statements. The words, anticipate, believe, estimate, expect, tend, will, guide, confidence, targets, projects, and other similar expressions typically are used to identify forward-looking statements. These forward-looking statements do not guarantee the future performance that may involve or are subject to risks, uncertainties and other factors that may affect DropCar's business, financial position and other operating results, which include but are not limited to, the risk factors and other qualifications contained in DropCar's filings with the SEC to which your attention is directed. Therefore, actual outcomes and results may differ materially from what is expected or implied by these forward-looking statements. DropCar expressly disclaims any intent or obligation to update these forward-looking statements. At this time, it's now my pleasure to turn over the call to Spencer Richardson, our Chief Executive Officer of DropCar. Spencer, please go ahead.

Thanks, Paul. Good afternoon and welcome to the call. Q3 marked a transformational quarter for DropCar. Today, we’ll discuss both the results for the quarter, as well as the impact on our business moving forward. First, let’s take a look back. In our Q2 call, we discussed our plans to strengthen our balance sheet by selling our low voltage contracted units of business WPCS for $3.5 million in non-dilutive capital with a target close here in Q4. We also discussed improving our DropCar operating company margins by fundamentally changing the unit economics of our consumer subscription, parking slots, on demand park on here as a model, and expanding the reach of our last mile logistics technology and service delivery in the rapidly growing mobility as a service space. So we can continue to establish ourselves as mobility partner choice for OEMs, vehicle manufacturers, car share and vehicle subscription programs, dealers and even fleet owners transitioning their businesses to a world where cars are increasingly shared and delivered to consumers as a front door service. I'm very happy to report the progress we’ve made in Q3 in each of these areas, and how it positions the company going forward. First, we remain confident that we will be closing the sale of WPCS subsidiaries here in Q4 bringing in non-dilutive capital to the company. We’re also very pleased to announced we signed off yesterday on approximately $1 million on the prefunded-warrant for common financing with our largest shareholder at an approximately 50% premium to market based on yesterday’s close. Between these two events and the significant improvement to both or consumer and B2B margins here in Q3, we are in an excellent position to be able to focus on our growth strategy, which we will also cover a little later. Digging deeper…

Thank you. The floor is now open for questions [Operator Instructions]. Our first question is coming from David Baker of Mach 100. Please go ahead.

Spencer, can you please tell us what is the approximate burn now on a quarterly basis?

So like I mentioned, we did cut the burn enormously about $650,000 per month. If you back out the numbers that we’ve put out there, I think you can get good approximation. And we are trending to numbers that were pre-premerger in our case. So we’re not giving guidance on the specific burn numbers. But if you were to back them out, I think you'd see that we’re operating significantly lower than we were obviously before September.

And a follow-up question, if I can. Can you please explain how are you making money with the consumer model of $19 an hour, you still have labor costs and other overhead costs. How’s that leading model which you say is generating positive gross margin, how is that really making money for the company -- it’s still like a pretty expensive service for the consumer?

I think it’s something that a lot of times people don’t understand the face value. But when you did in, it becomes pretty clear. So $19 per hour is the base rate and we’ve the hourly roundup. So what starts to happen is a job is at hour and 20 minutes and hour 30 minutes, that’ll generate $28 worth of revenue -- $38 worth of revenue, whereas normally we don’t go to four hour increments. Now, we actually still make a margin on the hourly increment given just what we're paying in the overhead as a churn. But that margin continues to go up as we benefit from the roundup. So I think that’s something that a lot of people just don’t understand looking at the model is the impact of that roundup has where you could be generating $38 on a 1 hour and 20 minutes job, and that starts to add up, especially when we start to see that the average job in our system does tend to move into that hour and 20 minutes, hour and a half range. The other benefit that it has that I think is not immediately obvious is it also burns with excess capacity in our system. So when we have drivers available, because we normally run that consumer component as a on-demand service, so it's really when we have drivers available when they are not working on B2B job, it essentially turns excess capacity. So while we're earning a margin against that and we want to scale and grow that, at a minimum given that our drivers are employed they've been self paid by the hour and operate on schedule, it actually helps increase our overall utilization rate. So that's something that we've seen in the transition now our utilization rates continue to grow as a result of the consumer shift. So it's not only we're making more money per subscriber that uses the system with the margin, so seeing the overall for grow efficiency of our labor and just pool of drivers increase.

Last question, can you tell me as the company estimated how many metropolitan cities in the United States are still target cities for the company services?

I think there is few parts. So they're specific cities in the U.S. that are quickly becoming mega cities, I think when you look at the demographic trend as generations go younger, they're moving increasingly into cities, so we siege the urban mobility opportunity continuing to expand. We're also starting to see the number of cities that are addressable and extending -- continuing to increase. You see markets where this case even Amazon as a reference, you look at Nashville and you look at markets where these growing technology companies, these growing other industry are moving increasingly to cities to attract additional manpower for their own initiatives. So cities that we wouldn't traditionally have seen three or four, or five years ago as becoming major cities that would need mobility solutions tend to what we offer, are now becoming addressable and very much something that's our road map. That said, I think is a core set of cities that still control about 80% of the total opportunity. The majority of those we're in and we want to continue to expand in. So before we're rushing into other cities in terms of our managed services and boots on the ground, there is enormous amount of growth that we can go after in the cities we're already and even here in New York where we've been in the market for a few years. But as we've seen with the impact of the change in the consumer model, the mobility challenges that are starting to hit the cities are only amplifying and growing. So that's really in terms of the mobility services from a managed service angle from our consumer subscription. But I'd also highlight our SaaS technology. So with that, we don’t have boots on the group. This is technology delivered through the cloud, through our mobility cloud. So operating in any cities but we're seeing that start to operate and find demand even in more ruler areas. So it is not just mobility challenges in city, I think it's also important to understand that as revolving more towards accepting cars versus owning cars and more towards fleets, essentially filling the mobility solutions around cities and even in the rural areas, I think the SaaS technology becomes really limitless in terms of its applicable industries, in terms of its market it can go into. So as a business, given our moves into SasS and the continued investment in growth we're developing there, I don’t think we’re limited to cities alone in terms of what we’re bringing our technology and mobility solutions to. But again it’s just steps that we’re basically taking to get to the world where ultimately see fleets starting to address just the array of mobility use cases that we’re starting to see demand for even today.

We’re showing no additional questions at this time. Does management have any closing comments?

No, I think we appreciate everyone who joined the call and we do have -- we’d encourage anyone who is interested in continuing to learn more about the company, work with the company, to sign up to our email list through our investors@dropcar portal. And if anyone is interested in setting up call with myself or Paul or other members of the team and learn more about the business and understand more about what we’re doing that’s encouraged as well.