Usio, Inc. Q4 FY2020 Earnings Call

Good day, and welcome to Usio Earnings Conference Call for the Fourth Quarter Ended December 31, 2020. Participants of this call are advised that the audio of this conference call is being broadcast live over the Internet and is also being recorded for playback purposes. A replay will be available shortly after the end of the call through April 12, 2021. I'd like now to turn the conference over to Joe Hassett, Investor Relations. Please go ahead.

Thanks, Matt, and thank you everyone for participating today. Welcome to Usio's fourth quarter and full year 2020 financial results conference call. The earnings release, which Usio issued yesterday after market close is available on the company's Investor Relations website at usio.com/investors under News. On this call today are Louis Hoch, President and CEO; Greg Carter, Senior Vice President of Payment Facilitation; Tom Jewell, Senior Vice President and Chief Financial Officer; and Houston Frost, Senior Vice President of Prepaid Services. Management will provide prepared remarks, and then we will open the call to your questions. Before we begin, please remember that comments on today's call include forward-looking statements. Forward-looking statements can be identified by the use of such words as estimate, anticipate, expect, believe, intend, may, will, should, seek, approximate or plan or the negative of these words and other similar words and phrases. Forward-looking statements, by their nature, involve estimates, projections, goals, forecasts and assumptions and are subject to risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements, including risks related to the COVID-19 pandemic and its effect on the economy, the realization, and the opportunities from the IMS acquisition; management of the Company's growth; the loss of key resellers; the relationships with the Automated Clearing House Network, bank sponsors, third-party card processing providers and merchants; the volatility of stock price; the loss of key personnel; growing competition in the electronic commerce market; the security of the Company's software, hardware and information; compliance with complex federal, state and local laws and regulations and other risks detailed in the Company's filings with the SEC. These forward-looking statements speak only as of the date of this conference call and should not be relied upon as predictions of future events. Usio expressly disclaims any obligations or undertaking to update or revise any forward-looking statements made today to reflect any change in Usio's expectations with regard thereto or any other changes in the events, conditions or circumstances on which any such statement is based, except as required by law. Please refer to the company's SEC filings on its Investor Relations website for additional information. With that, I would now like to turn the call over to Louis. Louis?

Thank you, Joe, and welcome, everyone. I'm pleased to report record revenues for both the fourth quarter and the full year of 2020. Revenues increased by 27% in the fourth quarter, resulting in positive cash flow. We also achieved positive net income and earnings per share in the quarter. Annual revenues reached $32 million, a 14% increase over fiscal 2020, with double-digit growth despite a decline in the second quarter due to COVID. 2020 marked our fourth consecutive year of revenue growth. In the second half of the year, we experienced a strong recovery and are entering the new year with significant momentum. The growth in revenue is supported by high transaction volumes, with a record $920 million processed in the fourth quarter. Prepaid volumes more than doubled, and card transactions nearly doubled compared to the same period in 2019. ACH is rebounding with strong sequential growth from the third quarter and is expected to show year-over-year growth in Q1 of 2021. The fourth quarter also included one month of IMS revenue, which we acquired in December and has met expectations. Our results demonstrate the strength of our diverse payments channel strategy, which includes ACH, prepaid card processing services, and output solutions in the growing electronic payments market. This year, we've started providing segment and revenue information to enhance transparency. In our ACH segment, we're witnessing a continued recovery from the lows of the second quarter of 2020. We've proactively expanded our product offerings, which has helped mitigate the challenges faced in our non-bank lending market, which has not yet fully recovered to pre-pandemic levels. For example, PINLess debit has been growing rapidly. We recently introduced account inquiry to help our customers comply with new compliance rules that went into effect in March 2021. Additionally, we are branching into new markets such as cryptocurrency and bundling ACH with other services like our prepaid card products. We expect ACH to have its strongest quarter ever in the first three months of 2021, with the potential for a record year. ACH remains our most profitable business segment. Our card segment is also experiencing positive momentum. As Greg will discuss, the PayFac business has started to grow across all three revenue streams: new ISV partners, new merchants from existing ISVs, and organic growth at the merchant level. The new implementation process has increased activations and volume at a rapid rate. In fact, in the first quarter of 2021, we began onboarding merchants from an ISV that is now our largest card account, potentially representing over $100 million in annual processing volume. Our focus on developing vertical expertise has paid off, with two of the three largest bankruptcy law software vendors now being Usio accounts, alongside successes in other sectors like property management and franchising. We will continue to invest in our card business to capitalize on this momentum by strengthening our infrastructure, integrating our new EVPP product, and enhancing our sales organization. We anticipate 2021 will be a great year for our card division. Prepaids doubled in 2020, and Usio is now a leading provider of prepaid cards to government entities and organizations, including those focused on COVID-related disbursements. Houston will share more detailed results shortly, but it's clear our innovative prepaid programs are discovering growth opportunities that utilize our proprietary technology and commitment to excellent service. Lastly, I’m very pleased with the seamless integration of IMS, which we acquired in December and have since rebranded as Usio Output Solutions. They have been onboard for four months and have exceeded our expectations. We see cross-selling as a growth opportunity, and we have already sold Usio Output Solutions into legacy Usio accounts, while Output Solutions has also sold Usio electronic payment solutions. The expansion of the PayFac sales team will bundle our offerings, including Output Solutions, for enterprise-level sales where we will develop a robust EVPP solution on the Output Solutions platform. We remain optimistic about Output Solutions and expect it to contribute positively to our 2021 earnings. The fourth quarter concluded a year of impressive progress and growth, showing continued sequential improvement since 2019, interrupted only by the COVID-affected second quarter. Business momentum has never been stronger. In the first quarter, we have already observed several key developments that we believe will help sustain, if not accelerate, this momentum. Prepaid continues to secure new agreements, and card transactions and volume growth have surged as activations improve. Output Solutions is growing, with perhaps the most exciting development being in ACH, where our penetration into the cryptocurrency sector is driving exponential growth. Our exclusive agreement with Voyager puts us on track to set another quarterly dollar process volume record that could exceed our previous best by over 50%. This will provide a fantastic start to a year where we anticipate revenues of $50 million and positive cash flow for 2021. To support this growth, we finished the year in a strong financial position, which will allow us to keep investing in our technology, sales, and marketing initiatives. With $5 million in cash and cash equivalents and no debt as of December 31, 2020, we believe we can self-fund operations for the next 12 months. Our comments are based on the assumption that there is no further deterioration in the economic conditions caused by the coronavirus pandemic. Conversely, if conditions improve, this could aid the implementation process and positively impact our non-bank lending customers. We are very excited about the upcoming year. Thanks to the hard work and dedication of our committed Usio employees, we have positioned ourselves well to take advantage of the growing adoption of electronic payments. We have adhered to our plan, and now our goal is to leverage our investments for above-market growth to create value for our shareholders. With that, I will conclude my opening remarks and hand the call over to Houston Frost, our Senior Vice President of Prepaid Services.

Thank you, Louis, and welcome, everyone. It was both an outstanding quarter and year in which we basically doubled the size of our prepaid business. The strong growth experienced over the first three quarters of fiscal 2020 carried over into the fourth quarter. Card load volumes were up 95% and transaction volumes were up an even stronger 143% in the fourth quarter as compared to the same quarter last year. For the year, load volumes were up 162% and transactions up 97%. As a result, prepaid revenues nearly doubled to $1 million in the fourth quarter and more than doubled to $3.2 million for the year, an increase of 107%. The primary driver of growth remains our support of community civic and social nonprofits as well as municipalities and other governmental organizations providing financial assistance to communities in need. While the great majority of the volume was initially related to pandemic relief, we have already begun to work on several non-pandemic related programs, for example, guaranteed income programs. The organizations we have worked with over the past 12 months have recognized that our prepaid solutions provide the control and flexibility they need to improve the process of dispersing funds, as well as visibility into how funds are being utilized. In the process, Usio has become a leader in the field with over 100 organizations across the United States integrating our card issuing technology into their programs. I also want to mention that Mastercard has been a fantastic partner this year, helping us build new relationships and supporting these new card programs. Our partnership has continued to evolve where Mastercard is further integrating us into their philanthropic city possible network, an accelerator for America program. For instance, Community Care Partners of Oklahoma is the recipient of a Mastercard accelerate accelerator for America grant. Through our relationship with Mastercard, we were introduced to Community Care Partners, which has since implemented our prepaid card platform. From this foundation, we are branching out into adjacent programs. We are now the card provider powering the high-profile Content Pledge program in California, the Child & Youth Fund in Baltimore, and charitable programs at the United Way of Central and Northeastern Connecticut among others. One California city has even chosen Usio to support their landmark cash for trash program. Many of the organizations that originally chose Usio to support their pandemic relief efforts are now integrating us into these and other similar initiatives. So, we are capitalizing on the doors that our pandemic relief programs have opened to create broader, deeper relationships across these organizations, as well as to leverage our growing industry-leading reputation to build new relationships. And in the many conversations I've had with the investment community, I've emphasized this point: Our most valuable assets are the relationships we're building. Service matters, so we are laser-focused on flawless execution as the key to our continued growth and prosperity. While there may be some unevenness in early 2021 in the trend of cards issued in dollars loaded, it is our expectation that our trajectory will lead to further growth in fiscal 2021 and beyond. With that, I'd like to conclude my opening remarks and turn the call over to Tom Jewell, our Senior Vice President and Chief Financial Officer to discuss financial results in greater detail.

Thanks, Houston, and welcome, everyone. Thanks for joining our call today and your interest in Usio. I will provide a brief review of our financial results before turning the call over to Greg. Looking at the fourth quarter, revenues for the fourth quarter ended December 31, 2020 increased 27% to $9.4 million compared to the same period last year. Continuing the strong trends seen throughout 2020, revenues were up 98% in our prepaid business. And in our card business, revenues were up, also led by PayFac, which was up 22% in the quarter. ACH revenues continue to recover from the second quarter trough and were up sequentially for the second consecutive quarter, in part due to growth in our PINLess debit and account inquiry product lines. During the fourth quarter, we acquired IMS, and approximately one month of the revenues are included in our results for the quarter. Organic growth for the quarter was 11%, excluding the Output Solutions revenues. Gross profits increased by 63% to $2.4 million versus the same period last year. Gross margins in the quarter were higher by 550 basis points from the prior year period, primarily driven by shifts in product mix. We saw good profit growth across the prepaid and credit card lines of business, plus incremental profits from the one month of operations from Output Solutions. Total selling, general, and administrative expenses were up 4% in the quarter compared to the same quarter a year ago. Sequentially, other selling, general, and administrative expenses, excluding stock compensation and depreciation and amortization expenses were up over $200,000, including incremental expenses associated with the IMS acquisition. In the fourth quarter of 2020, the operating loss was $700,000 versus a loss of $1.5 million in the prior year. Adjusted EBITDA was a positive $300,000 in the quarter compared to a loss of approximately $600,000 in the fourth quarter of 2019. Adjusted EBITDA was also much improved sequentially, as EBITDA improved by over $500,000 compared to the third quarter with profit growth in our existing business lines, plus one month of operating results from the IMS acquisition. The company had positive GAAP net income of $200,000, or $0.01 per share for the quarter. Net income in the quarter benefited from $813,500 of other income resulting from the forgiveness of our PPP loan. Turning to 2020, looking quickly at the results, it was our fourth consecutive year of revenue growth, revenues were $32.1 million, up 14% over the same period last year. Organic growth, again excluding Output Solutions revenues was up 10% with prepaid revenues up 107% and card revenues up 12%. Gross profits in 2020 were 24% over 2019 as we were able to expand margins 180 basis points during the period. While the revenues for the year were up 14%, our core SG&A costs, again excluding stock compensation and depreciation and amortization increased less than 6%, while continuing our investments in our PayFac and prepaid growth initiatives. Adjusted EBITDA for the year improved almost $1 million to a loss of $760,000 versus a loss of $1,750,000 in the same period last year. The company is in a strong financial position. Cash and cash equivalents at December 31, 2020 totaled $5 million after using cash of approximately $6 million in December for the IMS acquisition. The company had no significant long-term debt at December 31, 2020. We believe we have the liquidity and financial strength to support continued investment in our growth initiatives, to fund operations and undertake selective accretive acquisitions consistent with our growth strategy. After a second quarter interruption as a result of the impact from the COVID-19 pandemic, results over the last two quarters have returned us to the strong growth trajectory exhibited exiting 2019. We expect the momentum built up over the second half of 2020 to carry over into the new year, whereas Louis mentioned, we're expecting a record first quarter. And for the year, we expect to be cash flow positive, which will enable us to self-fund operations and our growth initiatives. At this time, I'd like to turn the call over to Greg Carter. Greg?

Thank you, Tom, and welcome everyone. It was another record quarter and a record year for the Card segment, in fact, all-time record highs. Card dollars processed were up 17% and up sequentially from 15% growth in the third quarter, while transactions processed nearly doubled at 97%, also a strong sequential growth trend from 81% in the third quarter. For the year, dollars processed were up 14% and transactions processed were up 58%. With growth in the second half of the year above, this clearly illustrates that growth is accelerating and we are headed into 2021 on a strong trajectory. Revenues were ahead 12% for the year and 3% in the quarter. Just as importantly, we signed contracts with dozens of new ISVs, substantially strengthened our overall infrastructure, and implemented new processes and procedures to improve productivity and efficiencies. The net result is a significant improvement in our conversion rate. We are now more confident than ever that the ISVs choosing Usio's PayFac will quickly move from signing to processing. So, the Card segment continues to make great progress establishing a solid foundation to support what we expect to be exponential growth in 2021. Now let me provide an update on some commitments I've been sharing with you since joining Usio. First, I committed to bring more discipline, structure, process, and accountability to our operations. I firmly believe the addition of the dedicated implementation team established earlier this year has been a driving force behind the improvement in our conversion rates. We continue to invest in that team on a strategic basis and we're earning an attractive return on the investment. An example of our continuous innovation is our new customer scorecards. These allow us to go to ISVs and present them KPIs related to their processing business, such as how many merchants have boarded, how much volume has been processed, and the revenue earned by the ISV. Believe me, the last KPI gets their attention. This provides a consolidated dashboard that allows the ISVs to gain insight on their program, and this has been well received by our ISVs. I believe we have benefited from the repetition of a more disciplined process. We are getting more intelligent about how ISVs operate, and each implementation is better than the previous one, and we're becoming much more efficient for getting these done in a timely manner. Basically, we're getting smarter. Second, I committed to reorganizing our sales operation into a more vertically focused subject matter expert structure. This too is paying dividends. Most predominantly as a result in the legal software vertical, two of the three largest legal software ISVs are Usio clients. And over the past 2 months, we have strengthened our sales team by adding new enterprise-focus professionals. The success of our new sales strategy is also a function of a significant improvement in our marketing efficiency, which just seems to get better day by day, and our commitment to mining our existing customers, which we believe are processing billions of dollars in electronic payments outside of Usio. Once again, the implementation team has been doing a fantastic job with this opportunity. One example is a name which may sound familiar to you, Practice Suite. Once a somewhat dormant Usio ISV, Practice Suite is now boarding new merchants every week. I expect by the end of the year, they will have meaningful volume on our platform. So, the implementation is pulling double duty, getting our new ISVs on board and processing while also going back to existing relationships and helping them convert their merchants and increase activations. So headed into the new year, we are feeling very good and are highly confident that the first quarter will be another record quarter for the Card segment. Specifically, we expect solid performance from our bankruptcy software ISVs. They are actively boarding merchants, and we are seeing volume ramp on our system. Having recently shown our scorecard to one of these ISVs where they have assigned a dedicated Program Manager, I can tell you they're highly motivated to accelerate the merchant adoption process. This also provides credibility within the legal software space, where we are pursuing additional opportunities. In the first quarter of 2021, we've already contracted eight new ISVs. Given the heightened productivity of our implementation team, and after the typical coding process, we expect to add meaningful volume on top of our existing business. And it now appears that we could possibly onboard and implement our first $100 million per year processing volume clients. They are on pace for a $9 million month, which we think could eventually go higher. As I mentioned, Practice Suite is also scaling. In fact, we're starting to see merchants boarding at a steady pace for many of the previously dormant ISVs. Another new growth vertical is the franchise model. We recently contracted with a roofing franchise that has mandated all new franchisees implement the Usio PayFac technology to process electronic payments. Another well-established franchise that is expanding their brand into the coffee space is doing the same. The franchise market represents an exciting new growth opportunity. Finally, as the pandemic subsides, we believe we will start to see volume increase from the ISVs with businesses that were most directly affected. Again, this growth that is essentially in our system that we believe will manifest over the coming year. For instance, our ISV that serves the parking space is starting to bounce back as more and more people take to the road. New ISVs, new merchant sign-on to add ISVs are two growth channels. There's a third growth channel in the organic growth of the individual merchants. So, we really have three ways to grow and each we feel highly confident about results in 2021. Before concluding, I want to echo some of what Louis mentioned, and that we are not fully out of the COVID-19 woods yet. We certainly feel good about things that we control; COVID-19 continues to have lingering effects at certain ISVs, although we are optimistic these will shortly resolve. Last quarter, I concluded with some thoughts about the long-lasting service. From the investment we are making in our organization, I hope you can appreciate that we value service to our customers very highly and not just in card but throughout Usio as a whole. We will never forget that. That concludes our prepared remarks for today. So, we would like to now open the call for questions.

Our first question will come from Barry Sine with Spartan Capital Securities. Please proceed.

Hey, good morning, gentlemen.

Good morning, Barry.

My first question is on the credit card business, obviously, your largest product category and a couple of aspects to my question. First of all, we've seen a divergence between growth in transaction volume and card dollars in the last couple of quarters. Wondering what's going on there? And within credit card, if I look back to the results you just reported for 2020, what were the COVID-related pluses in credit card? And what were the negative impacts, and how can we read that as we bounce back in 2021?

So, the first part of your question, I'll answer, Barry. We brought on a card customer on the PINLess debit platform, that their fees are less than $5. So, it's a lot of transactions, lower dollar volumes, but we get our normal margins on that traffic. So that's what kind of skewed given us more transactions with less average ticket. And then the second part of the question?

Could you repeat the second part? Is that the COVID-related nature?

Yes, I want to look at just credit card revenue, and better understand the results just reported for the last four quarters, what were the negative impacts that drove the credit card revenue? And were there any positives like income transfer programs in credit cards, specifically. I know, prepaid, but credit cards specifically.

Yes, COVID definitely had an impact on one portfolio that we have in the second quarter, and that was our veterinarians, our dentists. But with respect to some of those ISVs that were generating traffic prior to COVID, a lot of those ceased to exist entirely. But because of COVID and the desire for contactless payments, some of our ISVs actually improved. So, that portfolio that I referenced earlier is back to normal levels. But I don't think there's any negative effects as we sit today.

Okay. And you also mentioned crypto, which is kind of the magic word in the stock market these days. If you could elaborate a little bit more on what you're doing? It sounds like you're processing U.S. dollar payments going to crypto exchanges. Currently, we can kind of just discuss that and then what's the outlook for potentially having Usio accept cryptocurrencies for payments to merchants on your platforms?

So as to your first question, we’re having a lot of volume with crypto, and it obviously mirrors the excitement that surrounds the crypto industry right now. What we're doing for exchanges is when you set up an account, you need to fund your account. And so, you're pulling money from your checking account, or your savings account. As you add more money to invest in crypto, you create more ACH transactions for us. When it comes time to withdraw money, you're creating more ACH transactions for us. You will also see us implement prepaid cards to tie in with exchanges. And so, that segment, ACH and prepaid cards are a great fit for crypto exchanges. Another great fit is PINLess debit, and you'll see us do some of that as well with the crypto exchanges. Accepting crypto as payments for our merchants is definitely on the roadmap, and we have the partner to do it with well-integrated into our gateway, and it'll become another payment option. When we do that, we won't accept any risks on the crypto fluctuations. We'll have a partner do that for us. But we will allow payments to be made with Bitcoin and other prevalent coins.

Okay. My last question, if you don't mind, is on ACH. So, you gave some pretty bold comments about the outlook for that segment after a rough year in 2020. There is a disclosure in your 10-K, I believe, that you lost a pretty significant customer in the first quarter. So, despite the loss of that customer, you still expect very strong growth in ACH, especially in the early part of the year.

Yes, we did lose a customer that represented about 15% of last year's volume. About one and little more than 1% of our revenue last year that was totally offset by our gains from organic growth and customers in Q1. Q1 will be up substantially—great quarter for ACH. And it winds up being our best quarter in ACH in the history of the company. Thank you, Barry. Our next question will come from Gary Prestopino with Barrington Research. Please go ahead.

Hey, good morning, everyone. A couple of questions here. The 26% gross margin that you got in the quarter is a significant increase sequentially as well as year-over-year. Can we talk about it? Was that driven by IMS or Output Solutions? Or was that driven by resurgence of the ACH business? And then what does that portend for 2021 in terms of your gross margin?

It definitely was driven by IMS, and partially by ACH, but we’re projecting low 20s for the year.

Okay, so low 20s. All right. And it sounds like from the way you're talking about the momentum going into 2021 that we should see sequentially if things stay the same. The results get stronger as we go through the year, year-over-year and on a sequential basis. I mean, at one time, you had kind of committed that you would do over a million dollars of adjusted EBITDA in 2021. And I know you didn't mention giving any guidance, but just trying to understand is how you were looking at the year this year in terms of the overall growth aspects for the company.

We're definitely on a nice growth pace right now and in Q1 is amazing. Then we'll have the guidance we're given as it is more for the year. And we believe that we will achieve $50 million in revenue and be cash flow positive for the year.

Okay. All right. That's good. And then given that, Greg, you're saying that the PayFac business is starting to reach an inflection point. Overall, though, when does that get to the point where, and I know you don't break this out, but the business that you're doing and the revenues you're generating there can fund the growth and the investments that you're making versus having that come out of the whole corporate pie.

Yes, I think we're seeing a dramatic improvement in first quarter of this year with the ISV that I referenced earlier. There are several still in queue and in various stages of rollout activation. So, that inflection point I believe, is not only now, but this quarter and into the balance of 2021. So, to the extent it isn't in the big bucket, or using kind of your words, I think we'll be able to really see that the results of PayFac quarter and into the remainder of 2021. And just to be clear, with that ISV that you say is processing $100 million worth of dollar volume of transaction, that would be 3% to 4% of gross take off that $100 million by the ISV. And then whatever percentage you guys would get, generating the volume that you do offer that 3% to 4% of that $100 million, is that correct?

That's a little high for this year ISV because majority of their traffic is actually debit cards.

So, in the 2% range, the margin—our margins are similar, though. We are splitting revenue with the ISV obviously.

Okay.

Yes.

Our next question will come from Brian Kinstlinger with Alliance Global Partners. Please go ahead.

Great, thanks so much. A follow-up on the gross margin, which was impressive in the fourth quarter. You said you expect, just now today, the question that you'd be in about low 20s in 2021, which indicates down from the fourth quarter, but IMS only contributed one month. So, what are the factors to drive gross margin lower, given IMS will generate full quarter—full quarters of revenue and ACH is surging with Voyager?

So, ACH is a big pickup for margins. But 60% plus for ACH business; that's definitely going to help. Our card business PayFac is growing pretty quickly. And that is a lower margin business and that's going to pull it down, and then print and mail is a lower margin business. In the last year, we had some lucrative deals come through IMS with higher margin. So, their normal part of their business is very similar to PayFac where it's 15% gross margins.

And so I tell if that clarifies it for sure. And then I looked at the balance sheet and see prepaid card load obligations has gone from $19 million in the second quarter to $7 million at the end of December. How do we think about this in terms of the potential to generate revenue? Is it a small percentage of that $7 million assuming, obviously, the cardholder uses all those funds? And then if you could comment as well, Houston mentioned that the unevenness in prepaid in early 2021, we assume it'll fall from fourth quarter before it starts to increase again.

So regarding the prepaid load volumes for customers, it's important to note that these figures do not represent the actual dollars loaded onto card accounts; rather, they are funds that are waiting to be loaded. Essentially, this provides only a snapshot in time. It's challenging to use this number to project load volumes because it varies depending on when you're examining the data, how much money is ready to be loaded onto cards, and when clients will actually load the cards. I'm happy to clarify further, but this does not reflect total load volumes for the quarter or anything similar since it's not our prepaid card balances but just funds held for future loading onto cards. What kind of revenue are you getting from that load? So, just some percentage of those loads – and I assume when they're used you get some percentage of that in processing. So I guess I'm just trying to understand what the percentage you’ve given, where are you at, and then obviously we've got a new COVID relief package, so I expect that's going to benefit. So really the federal COVID programs while we do see some volume come through on that, that really comes through on our consumer reloadable or GPR kind of bank alternative products. So, we're not doing dispersing funds from the federal government and we started this time we are really dispersing funds from smaller programs that are supported by nonprofits, cities, and states that are going to underserved communities and different kinds of community segments. So yes, we will see some load volume just from direct deposits coming in from the federal stimulus and I'm sure some of the stimulus from the federal government that goes to the states will end up in some of these programs that we worked with. But again, it's sort of hard to do any direct correlation there.

Great. Thanks so much, guys, for your time.

Our next question is a follow-up from Gary Prestopino. Please go ahead.

Hey, Louis, can you talk a little bit about what some of the successes, early successes you've gotten from cross-selling your payment products with the IMS business or the Output Solutions business?

Yes, without naming customer names I can tell you that Usio legacy processes payments for a lot of municipalities and we also have a lot of health care accounts and they obviously have a lot of regulatory notices and they have statements. And so, we're able to pick up the phone and I think this last quarter flowed three—great success in selling print. We have also this quarter hired two very experienced enterprise sales people to add to Greg's team. They are going to be focused on selling electronic bill presentment and print and that they'll also be able to sell payments, obviously, but the first thing they're going to lead with is electronic bill presentment and print. And so, you're going to see a lot of that. We're going to be able to grow the print business for sure and we're definitely going to be able to provide payments into this amazing customer base that we acquired which is a whole bunch of utilities, some large credit unions and also a lot of municipalities, including states as well as governments.

Is the plan to take the tape back business and white label it for the individual entities currently using Printville, allowing individuals to go directly to the entity's website to pay their bill with a credit card, or do they need to send a bill that directs them to https://usio.com to pay their bill?

So the quick answer is we have both solutions, but the ABVP is going to be sold as a service so that through the toolkit they're able to implement the portions that they need so they're able to grab their print statements via PDF to integrate into their customer service platform. They can also do credit cards they can do PINLess debit associated with that statement; they can do ACH one-time recurring. And so all that's available through our toolkit and as a service and allows the utilities to pick and choose what they need.

Okay. Thank you.

You bet. Thank you.

This concludes our question-and-answer session, which also concludes our conference for today. Thank you for attending today's presentation; you may now disconnect.