EGOV
#Thanks for the questions.
No, Pete.
I don't think there is really anything else to consider.
My concluding remarks just a moment ago certainly I think our results for the quarter exceeded our expectations on just about everymetrics so we came out of the gate strong.
It is still really, really early in the year and I don't think we'll be making any changes to the guidance that we have provided on the last call.
Pete, this <UNK>.
I will take a stab at part of that question.
The answer is yes, right off the bat.
As far as do we see any portability here.
As you know we took a different stance on this one because (Inaudible) technology is advance and where Wisconsin is being the second largest hunting and fishing state out there, we want to make sure we put our best foot forward and we built a rock solid system that we could then leverage elsewhere.
We have been very diligent.
We have been very careful.
There have been some opportunities present themselves, and instead of getting ahead of ourselves we decided to keep our gun powder dry until we were ready to step out there.
We have heard from states that they are anxious to see what comes from Wisconsin.
So I think it is now just a matter of time for them to see that, to get an understanding of what has been deployed and the value it brings back to Wisconsin and opportunities should come from there.
I look at <UNK>, to see if he wanted to add anything.
Thanks, Pete.
Thank you, <UNK>.
Yes, I think in terms of this quarter, <UNK>, we had mentioned some motor vehicle inspections and registrations, limited criminal histories, tax fillings, professional licensing.
So some of them are new services.
When I say new services, services that we launched in states that weren't up and running this quarter last year.
And so there is no new services of that listing that I just put forth none of those are new.
We had obviously built those services and launched those services in others state.
So most of those are kind of our good solid historical performers.
Well, I don't ---+ certainly on a year-over-year basis I think revenues werereally the primary driver.
We had a really good strong quarter of revenue growth and I wouldn't necessarily say it was anything investment related.
We did keep in mind last year this quarter we did have I think three-quarters of a million dollars roughly in one time costs related to this vehicle inspection service in the state of Texas when they switched to the single sticker legislation, so that was weighing down our results somewhat in the prior year quarter.
But other than that, I think it is just a really good strong quarter of revenue growth combined with some good efforts on our part in terms of controlling the cost side of the equation.
I guess I would say this, is that certainlyQ1 was a good quarter but in our guidance we provided for 2016 we essentially implied similar margins for operating income margins and total gross profits fairly similar to what we have seen recently.
So until we stack a couple more quarters of results like we say this quarter, I'm probably not too comfortable going out on a limb saying that we should automatically see margin expansion the rest of the year.
Thank you.
Hi <UNK>.
We don't have an exact measure for that.
<UNK>, I guess what I would say is typically most of the growth we see from an IGS standpoint comes from the launch of new services that's probably the majority of our growth.
Certainly we see a component of our growth that relates to more usage of the same servicesyear-over-year.
But by and large I think most of our growth roughly using the 80/20 rule probably the bulk of that growth is coming from new services that we have launched over the course of the last year.
I don't know if I would say (Inaudible).
Keep in mind the way it works, and <UNK> nailed it 100% we are constantly looking for new innovations, new services that we can launch.
At the same time we have teams that are driving existing applications out there to either new users or educating the existing user base how they can use it more properly maybe in more depth.
So we are growing our business both ways as aggressively as possible.
We never take anything for granted.
And I will just tell you it was a great quarter.
Our teams did really good work, out partners were aggressive with not only new services but helping us get the work out.
And we're very pleased with the quarter.
It is a great question, because it gives me an opportunity in that you're right.
(Inaudible) as far as new states.
But one thing we have always said is we have great organic growth in our business, and we have a very robust solid business, book of business right now that we continue to growquarter after quarter year after year.
And this was a great one and we expect to continue to grow our business and have very aggressive management teams out there driving it.
Absolutely.
I mean that is part of what got us so excited.
Go in ---+ it is a pilot.
Remember they wanted to do a pilot to see how it would work from there.
To go aggressively show them what we have done in the states and how thatcould be leveraged to federal space and then once we got them up, which we got three of them up very quickly, then convince them ours is the right solution and can we roll that our to more and more and actually do other services for them.
We think this is a great lead in now time will tell.
No.
At this point it is just a pilot they haveimplemented
And we share a portion.
Yes, we just share a portion of that fee.
And it will really be up to the agency as they look and get a feeling for how it is working and what's going on there.
And part of our responsibility as <UNK> said to try and push that and show the success it can have.
I think we might have talked about this last quarter, <UNK>, on the call.
Our team in D.
C.
has done a remarkable job of quarter after quarter signing up new carriers and new subscribers to the service.
And that is really part of what is driving growth is adding new trucking companies and new users of the service each quarter.
I have saida number of times I expect to maybe slow down a bit.
It has been a great, great performer growing in double-digit percentage growth for usthis quarter.
Well, <UNK>, I think what we have historically said we have been able to grow the business in the high single-digit on a total same state basis with the majority of that high single-digit growth coming from IGS services.
From low to mid double-digit growth is what we have historically seen.
We saw 16% this quarter which was one of our strongest quarters we have seen in a long time.
I think the long-term growth dynamics of the business we don't necessarily view any differently than that.
Our hope is that we can continue to sustain growth in that upper single digits some quarters in the low double-digit.
But it is also important in order for us to maintain that type of organic growth we need to win new states from time to time.
I was waiting for <UNK> to finish that because my reaction is real simple.
There are new states coming.
We are going to win new states and there is federal opportunities we are working.
I realise it has been a little bit of a lull but those things happen in all business.
It is a great question because it does give us an opportunity to really discuss how strong our core business is.
But we do see opportunities for growth outside the existing book of business.
Time will tell on that one, <UNK>, I think we have been doing a little bit better in population growth from just a pure volume standpoint.
If that trend continues, that would be a little bit better than just the population growth but again time will tell.
You bet.
That's a great question and I'll let <UNK> jump in just a second.
But here is what I would say, number one, when you look at anything dealing with businesses, (Inaudible), we have looked at those and said there is opportunities to grow them and we do that.
We grow that right now in our existing business often times we don't speak it and point them out.
One is for competitive reasons.
When we launch some of these services we don't want somebody to necessarily know what we are doing to go knock on that agency's door.
If we are going to be making a major investment then definitely we are going to put a spotlight on it because we want to be as open and honest with you as we can saying this is where we are spending above and beyond.
Or if it is one that we think will really be a needle mover.
I will tell you we make the majority of our money off business to government.
So just about anything we do business to government there are often times we might take at that next level.
And it is just something we are exploring.
There is none that I would throw out there and say, hey, here is the very next big one just because I don't want anybody to get in front of me.
I don't think it was a true up.
As I shared in my scripted remarks, we actually saw a decline of about $500,000 in vehicleinspection service because of a change in the way we're recognizing revenue.
However in the prior year quarter we actually saw a decline of about 700,000 from that service.
So comparing the two quarters it was a slight benefit this quarter.
But nevertheless we did see revenues decline from the service compared to what we (Inaudible) expect from the service.
No, I wouldn't say Texas is one off.
This one service we highlighted happens to be our largest IGS service across all our states.
And ultimately these were a reflection of legislative changes that were made by the state legislature.
That's right.
So there is nothing necessarily special about Texas or different about Texas compared to our other states from a revenue recognition standpoint or how we negotiate the terms the conditions of the deal.
Okay.
That's all I have.
Thank you very much.
All right.
Thanks.
Thank you, Kelly.
And thank you to everyone who joined us this afternoon.
I look forward to speaking with you during tomorrow during our 2016 annual stockholder meeting at 10 AM Central time when I will share more about our plans to continue to lead the digital government services industry in the future.
Including demoing a very cool innovative solution.
We hope that all of our stockholder investors will join the webcast by visiting the Investor Relation page of our website at egove.com, or better just join me in person at the new Olathe Conference Center at the Embassy Suites Hotel in Olathe, Kansas.
I look forward to seeing everybody tomorrow.
Thanks.
