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TransAct Technologies Incorporated (TACT)
Q4 2018 Results Earnings Conference Call
March 6, 2019 4:30 PM ET
Bart Shuldman - Chairman and CEO
Steven DeMartino - President, CFO, Treasurer and Secretary
Jim Leahy - IR, JCIR
Conference Call Participants
Kara Anderson - B Riley, FBR
Jeff Bernstein - Cowen
Previous Statements by TACT
» TransAct Technologies Incorporated (TACT) CEO Bart Shuldman on Q3 2018 Results - Earnings Call Transcript
» TransAct Technologies Incorporated (TACT) Bart Shuldman on Q2 2018 Results - Earnings Call Transcript
» TransAct Technologies' (TACT) CEO Bart Shuldman on Q1 2018 Results - Earnings Call Transcript
I would now like to introduce your host for today's conference Mr. Jim Leahy with Investor Relations. Sir, you may begin.
Thank you, Darrell. Good afternoon, and welcome to TransAct Technologies 2018 fourth quarter conference call. Joining us today from the company are Chairman and CEO, Bart Shuldman; and President and CFO, Steve DeMartino. Today's call will include a discussion of the company's key operating strategies, progress against its initiatives and details on the fourth quarter financial results. We'll then open the call to participants for questions.
As a reminder, this conference call contains statements about future events and expectations, which are forward-looking in nature. Statements on this call may be deemed as forward-looking and actual results may differ materially.
For a full list of risks inherent to the business and the company, please refer to the company's SEC filings, including its reports on Form 10-K and 10-Q. TransAct undertakes no obligations to revise or update any forward-looking statements to reflect events or circumstances that occur after the call. Today's call and webcast will include non-GAAP financial measures within the meaning of SEC Regulation G. When required, a reconciliation of all non-GAAP financial measures to the most directly comparable financial measure calculated and presented in accordance with GAAP can be found in today's press release as well as on the company's website.
At this time, I would like to turn the call over to Bart Shuldman. Bart?
Thank you, Jim, and welcome to everyone joining us on this afternoon's conference call and webcast. For the 2018 fourth quarter TransAct generated net sales of $11.8 million, operating income of $1.1 million and adjusted EBITDA of $1.3 million, delivering a quarterly gross profit margin of 50.1%.
Diluted EPS for the fourth quarter was $0.12 per share. For the full year TransAct's gross profit margin expanded by 170 basis points while our net income and diluted earnings per share grew by 69% and 67% respectively.
Steve will review the results in more detail in a few moments, but I'm sure everyone on the call will want to hear from me about our recent launch of BOHA!. So let me give you a quick overview of our gaming and casino market and then get right into BOHA!.
For our global gaming and casino business, we generated 21% year-over-year sales growth in the 2018 fourth quarter on continued market share gains, particularly in Europe. In the US, we had first shipments of the new Epic Edge ticket-in/ticket-out printer to a large global casino operator in support of their new opening, which will come later this year.
As a reminder, the Epic Edge printer offers casino operators next generation technology such as 300 DPI print resolution for shopper barcodes and better ticket acceptance as well as improved graphic imaging for our bonusing applications such as using our EPICENTRAL system.
Internationally, our direct sales team in Europe remains a key driver of our business success as our customers respond to TransAct’s high level of service and attention, which has allowed our established Epic 950 printer to take additional share. For the full year, casino and gaming sales grew 43% to $26.6 million, and as we’ve said before, represented a key source of cash flow which we have deployed in our product development initiatives. We had a very good year in our gaming and casino market.
Okay, now on to BOHA!, a few days ago, our team celebrated debut of BOHA!, a milestone that represents several years of complex development with a close eye on the evolving needs of the restaurant and food service industry. As we have said for some time, TransAct sees a significant opportunity in this market and we are excited to debut a full initial range of BOHA! solutions was clearly demonstrate to the industry that we listen to their needs and put significant thought to how to best address these needs.
BOHA! is the transformation of our restaurant solutions business into a comprehensive ecosystem of cloud-based SaaS apps and hardware solutions that we believe will dramatically change how restaurant and food service companies manage the back of the house operations.
As the industry is still in a launch of nine apps and four hardware offerings, we have come to market for the first time with the only single vendor suite of integrated software applications and hardware solutions that can bring automation and digitization to wide array of kitchen tasks.
Importantly, by conversion, what we have historically been single -- which had historically been single task solutions that address only a portion of the market’s needs created by the spirit vendors. We have developed into a harmonized platform that will enable customers to easily and cost effectively deploy automation and technology into their complex back-of-house workflows. As they seek to devote more time it's creating a guest centric customer experience.