Good day, everyone, and welcome to the i3 Verticals Q4 2024 earnings conference call. Today's call is being recorded, and a replay will be available starting today through November 26th. The number for the replay is 877-344-7529, and the code is 48, excuse me, and the code is 4184020. The replay may also be accessed for 30 days at the company's website. At this time, for opening remarks, I would like to turn the call over to Clay Whitson, Chief Strategy Officer. Please go ahead, sir. Good morning, and welcome to the Q4 2024 conference call for i3 Verticals. Joining me on this call are Greg Daily, our Chairman and CEO, Rick Stanford, our President, Geoff Smith, our Chief Financial Officer, and Paul Christians, our Chief Revenue Officer. To the extent any non-GAAP financial measure is discussed in today's call, you will also find a reconciliation to the most directly comparable GAAP financial measure by reviewing yesterday's earnings release. It is the company's intent to provide non-GAAP financial information to enhance understanding of its consolidated GAAP financial performance. This non-GAAP financial information should be considered by each individual in addition to, but not instead of, the GAAP financial statements. This conference call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements, among others, regarding the company's expected financial and operating performance. For this purpose, any statements made during this call that are not statements of historical fact may be deemed to be forward-looking statements. You are hereby cautioned that these forward-looking statements may be affected by the important factors, among others, set forth in the company's earnings release and in reports that are filed or furnished to the SEC. Consequently, actual operations and results may differ materially from those discussed in the forward-looking statements. Finally, the information shared on this call is valid as of today's date, and the company undertakes no obligation to update it except as may be required under applicable law. I will now turn the call over to the company's Chairman and CEO, Greg Daily. Thanks, Clay. Good morning to everyone on the call. Each year that goes by, we look back and are amazed at all that has changed. We've never been a company that stood still. I'll cite our 50 acquisitions as an example. However, I don't think we've ever had a year as transformational as fiscal year 2024. Our team worked exceptionally hard this year to advance our transition to a pure-play vertical market software business and set the table for our next stage of growth. We exit the year as a streamlined and scaled vertical market software provider. As we look ahead at our opportunities in front of us for fiscal year 2025, we're excited about our position. We have great solutions that are mission-critical to our customers in underserved markets. We're building great new products, which Rick will discuss further. We have infrastructure to do it efficiently. We have the best-in-class payment facilitation platform that helps us maximize revenue opportunities, and we are delevered and poised to add more great businesses through M&A. We believe we have set the stage for a great fiscal year 2025 and beyond. Our visibility, our sales funnel, and products we have coming to market give us confidence in our long-term guidance of high single-digit organic growth. We remain focused on growth and excellent investment choices. I'll now turn the call over to Clay. I'm sorry, to Geoff, and he will provide you more detail on our financial performance, and when he's finished, Rick will add commentary on the business, and finally, Paul will discuss revenue, and then we'll open up the call for questions. Thanks, Greg. The following pertains to the Q4 of our fiscal year 2024, which is the quarter ended September 30th. Please refer to the slide presentation titled "Supplemental Information" on our website for reference with this discussion. Due to the sale of our merchant services business, we have classified that portion of our company as discontinued operations. The actual results and outlook section, which we will discuss, pertain to continuing operations only, which we also call RemainCo. This is a transitional reporting period as we completed the sale during September. Revenues for the Q4 of fiscal 2024 increased 4% to $60.9 million from $58.6 million for Q4 2023, reflecting organic growth of 2% and two months of revenue from our permitting and licensing acquisition in the public sector. Annualized recurring revenues increased 7.5% to $188.2 million as of Q4 2024, compared to $175.1 million as of Q4 2023. 77% of our revenues in the quarter came from recurring sources. SaaS and payments revenue grew 8%. Transaction-based revenues grew 11%, while maintenance and recurring software services grew 6%. Non-recurring sales of software licenses declined 8%, reflecting the ongoing shift to SaaS. We did receive a $2 million license fee from our Midwest utility customer, as expected. Professional services revenue declined 7%, principally as a result of the delay in our implementation with Manitoba caused by the public workers' union strike. Software-related services represented 75% of total revenues for Q4, and payments 20%, and other 5%. We are introducing a new metric for RemainCo net dollar retention, which we will disclose annually. This applies to all recurring revenue line items, but with the exception of payments. Net dollar retention for fiscal year 2024 was 100%. Adjusted EBITDA increased 4% in line with revenues to $16.2 million for Q4 2024, from $15.7 million for Q4 2023. Adjusted EBITDA as a percentage of revenues was 26.7%, a slight decline from 26.8% for Q4 2023, reflecting higher corporate expenses of $520,000 for RemainCo. Now, as the divestiture is behind us, we anticipate lower corporate expenses in fiscal year 2025. Pro forma adjusted diluted earnings per share from continuing operations was $0.15 for Q4 2024. This number excludes discontinued operations, but notably includes consolidated cash net interest expense, which, discounted for pro forma taxes of 25%, would come to $0.15. Again, please refer to the press release for a full description and reconciliation. Segment performance. Following the sale of the merchant services business, we have segmented RemainCo by vertical: public sector, which includes education, and healthcare. Other consists of corporate expenses and eliminations between segments. Revenues in our public sector vertical increased 6% to $49.6 million for Q4 2024, from $46.9 million for Q4 2023, and represented 81% of total revenues during the quarter. The increase was driven by recurring revenue streams such as SaaS, transaction-based revenue, maintenance, and payments, which offset declines in sales of software licenses and professional services. The segment's Adjusted EBITDA increased 6% to $20.2 million for Q4 2024, from $19 million for Q4 2023. Adjusted EBITDA as a percentage of revenues increased to 40.7% for Q4 2024, from 40.6% for Q4 2023, reflecting growth in recurring revenue streams, which often have higher gross margins. Revenue from our healthcare segment declined 3% to $11.4 million for Q4 2024, from $11.7 million for Q4 2023. Consolidation is prevalent in healthcare, and sometimes we lose customers that have been acquired by other healthcare providers. For the fiscal year, healthcare grew 2%, and we currently expect low single-digit revenue growth for fiscal 2025. Adjusted EBITDA declined 5% in Q4 2024 compared to the prior year, reflecting fixed costs that did not decline in proportion to revenues. Accordingly, adjusted EBITDA as a percentage of revenues declined to 18.9% for Q4 2024, from 19.4% for Q4 2023. Regarding the balance sheet, following the sale of our merchant services business during September, our balance sheet is strong and well-positioned for 2025. At quarter end, debt stood at $26.2 million, which is the remainder of our convertible notes, which mature in February. We still have $450 million of borrowing capacity under our revolving credit facility with a 5X leverage constraint. Our cash balance was $86.5 million on September 30th. As a result of the sale of the merchant services business, we will need to make tax and tax-related payments of approximately $65 million in the spring. We also have approximately $8 million of non-tax costs related to the deal that have not been paid as of September 30th. These accruals are included in accrued expenses on the balance sheet. Outlook. The following reaffirms guidance for continuing operations for FY 2025, which we set forth in our fiscal Q3 press release dated August 8th, 2024. As a reminder, fiscal 2024 being a transitionary year with the sale of the merchant services businesses, we released guidance for fiscal 2025 a quarter earlier than usual. The outlook does not include acquisitions that have not been announced or transaction-related costs. Revenues: $243-$263 million. Adjusted EBITDA: $63-$71.5 million. Depreciation and internally developed software amortization: $12-$14 million. Cash interest expense: $1-$2 million. Pro forma adjusted diluted EPS: $1.05-$1.25. We continue to expect high single-digit organic revenue growth with annual adjusted EBITDA margin improvement of 50-100 basis points. The Manitoba project should return to a normal cadence, and we expect continued momentum in the utilities market. The reduction in license sales in favor of SaaS deals will be less of a drag on revenues, and the education business has lapped the introduction of certain state subsidies for lunch. Acquisitions that have not yet closed are not included in the outlook. We do expect to resume acquisitions on a regular basis. From a seasonality standpoint, we currently expect our revenue distribution to approximate the following: Q1, 23.5%; Q2, 26%; Q3, 25%; Q4, 25.5%. Although software license sales are less of a factor than last year, they will still represent the most variable line item in the forecast and can distort seasonality in any given quarter. I will now turn the call over to Rick for company updates and M&A pipeline. Thank you, Geoff. Good morning, everyone. Over the past year, we have transitioned to a software-centric organization focused on our vertical markets. We've made significant advancements to achieve our vision long term. The divestiture of the merchant services business closed on September 20th, and the process of transitioning that business is going smoothly. Running parallel with that, we are committed to refining operations to optimize internal processes and increase our effectiveness and efficiency in many areas. We're excited to announce progress in our technology transformation efforts as well, achieving operational efficiency, cost savings, and enhanced customer service capabilities through consolidation of contracts and cloud migration. We have unified both customer-facing and internal support technologies, including our service desk and contact center platforms, into scalable, cost-effective cloud solutions. We are now delivering even more responsive and streamlined experience for our customers and employees alike. We are further centralizing cybersecurity measures using fully integrated Microsoft tools, including endpoint detection and response, mobile device management, and identity and access management solutions. Our AWS cloud consolidation initiative is nearing successful completion, with co-located and on-premise data centers successfully migrated to the cloud and unifying all subscriptions into an enterprise account, unlocking enterprise-level support. To increase efficiency across departments, we have streamlined back-office technologies, including consolidating instant messaging, file sharing, and telephony solutions. We have reduced dependency on multiple vendors while creating efficiency and reducing expenses. Together, these initiatives support our commitment to operational efficiency and exceptional service delivery. I mentioned last quarter the intention to hire an enterprise-level leader in product management. As Greg mentioned, we have hired Chad Fenner as our new Chief Product Officer. He will help us drive our ongoing investment in web-native configurable next-generation applications. He will be responsible for defining and delivering our product vision, strategy, and roadmap, and for communicating this vision. The addition of Chad to our team underscores our evolution into a pure-play software company. We have begun to rewrite our CAMA, computer-assisted mass appraisal platform, and are looking forward to its release next year. We have also started work on our Justice Tech 3.0 platform, which will allow us to take our court management software across the U.S. and no longer be restrained by state lines. Given high demand in the utility market, we are adding to our portal software suite and related billing distribution models. Last, we have added another seven products to our roadmap for SOC 2 Type II cybersecurity compliance framework. Regarding M&A in general, our acquisition pipeline continues to be strong with deals in public sector. We looked at several deals again this quarter and continue to have conversations with some of those targets. Many of these targets are tuck-ins of new products and services to complement our existing offerings or will help us expand geographically. I'll now turn the call over to Paul for final comments. Thank you, Rick. As Rick has shared, we've been transitioning into a cloud-first business model. This shift has involved thoughtful investment in human capital, organizational structure, and technology. As a result, we are making tremendous strides in our goal to deliver a sophisticated and diverse platform of software and services tailored specifically to meet the needs of customers in our strategic verticals. To accelerate revenue growth, we have integrated our sales efforts into a unified domain structure supported by a dedicated resource group, including elements of marketing, product development, and service delivery. As stated in previous calls, this alignment enables us to stay closer to our customers, ensuring that we are not only responsive to their needs but also proactive in capturing additional share of wallet. I am happy to report that sales activity and contracting are trending positively across the board, especially in enterprise utility, justice tech, public safety, ERP, and education sub-verticals. We continue to see increased solution bundling on both an intra and inter-vertical basis. The addition of Chad Fenner as our CPO will accelerate cross-vertical solution sales as we further integrate core enterprise solutions into our broader offering. Examples of this include increased adoption of our digital customer engagement suite and 12 new bundled contracts for law enforcement and court management software solutions in Georgia. In addition, we have fulfilled a significant software distribution solution for a multi-state tier-one utility, as well as payment facilitation as part of a multi-year project. Sales funnel activity and productivity in our new unifying Salesforce instance continue to trend positively. Given that, we anticipate the rate of positive sales activity and contracting results to increase through 2025. This concludes my comments at this time. We will open the call for Q&A, please. We will now begin the question and answer session. To ask a question, you may press *, then one on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press *, then two. At this time, we will pause momentarily to assemble our roster. The first question today comes from John Davis with Raymond James. Please go ahead. Hey, good morning, guys. If I look at Q4 revenue, it came in just a hair light of the midpoint of the guide. So just wondering, was there any kind of delayed implementations? Anything got pushed out? I heard you call out Manitoba, but I wasn't sure if there was some expectation of revenue in the Q4 that didn't happen, or just the other comments on Q4 revenue performance? Nothing in particular that pushed out. I mean, we always are. There's always a little bit of movement on the license line. We did get the big thing, $2 million that we were expected, which was good. We're back to school and kind of getting a sense of how that's going to shake out, but there was nothing we saw in Q4 that changed what we were expecting for fiscal 2025, so that's why. Okay, so that's helpful and then I appreciate the NRR, the retention of 100% this year. Obviously, it was a transition year, so as we go into 2025 and beyond, how should we think about kind of the growth algo at i3 to get to that high single-digit organic revenue growth number? Should we expect maybe 105-ish NRR plus a new logo growth? Just how are you guys thinking about the longer-term NRR as it pertains to the growth algo at i3? JD, we do want to improve the 100%, but I think the growth algorithm with that 100%, our organic for 2025 is about 7.5% implied at the midpoint, and so that would imply 7.5% coming from new logos during the year, but we do have a goal of improving that 100% net revenue retention from our existing book every year. One other point just to make on that. I want to make sure it was noted that the payments revenue is not included in that number. Two different data sets and different customer names. We'll see if we can get to that in the future. I think if you layer on the payments revenue, that probably you pick up that growth you get from your existing customers growing in their volume. So it probably pushed the net dollar retention a little bit higher. And I think this also just reflects that we are not aggressive pursuers of price increases. But to Clay's point, as the cross-sale story improves, as we tactically make choices on price increases, we do think that that number is going to go higher. Okay. That's helpful. And then just quickly on healthcare, understand consolidation there was driving the revenue declines. As you said, low single digit for 2025. Longer term, how should we think about growth of that business? Is it mid-single digits? Is it corporate average? And when do you lap kind of some big customer losses as we think about modeling 2025? Our current expectation is for low single digit for healthcare over the medium term, high single digit for education, and public sector high single digit. Okay. Thanks, guys. The next question comes from Mark Palmer with The Benchmark Company. Please go ahead. Yes. Thanks for taking my questions. Wanted to see if you could give us an update on your utility initiative. You made reference to it in the prepared remarks. And when would the company be in a position to begin to roll out the technology it derived from its initial project to various other utilities across the country? Good morning, Mark. On this initial project, we are in the process on the portal side of rolling that out today, and we see that accelerating, and on the distribution side of the business, we would anticipate the sales activities to begin in that as well, although that's a much more specific and measured particular module that is not as broadly used in the industry. So are we then looking at that activity beginning in the Q1 of 2025 and then accelerating through the year? How should we think about the cadence? Yes. That's the fair assumption. Very good, and one other question with regard to the M&A environment. Rick, you had said on the last call that you were seeing more rationality in the market as it pertained to the kinds of multiples that sellers were demanding. Any update on that front in terms of what you're seeing in the market and how that would potentially contribute to M&A activity in the coming quarters? Yeah, so obviously, there's still extremes on either end, but the people we're talking to seem to be more realistic as to their value and their future growth. I don't see that changing much this year. Our pipeline's very strong. We're still continuing to contact, through initial conversations, a lot of public sector deals. We are looking at some education, but I think we're in a good place for 2025 to generate somewhere between three to five acquisitions this year, and we're excited about the conversations we're having with our current pipeline targets. It seems like timing is more important than... Very important. Valuation. I mean, valuation's important, but it comes down to timing. Yep. Exactly. Very good. Thank you. The next question comes from James Fawcett with Morgan Stanley. Please go ahead. Hi. Thank you for taking my question. This is Shefali Damaskar on for James. Wanted to touch on the macro a bit, just how you're thinking about it in 2025, the general health that you're getting from customers. I know you touched upon what's going on in healthcare and just anything to note in certain verticals in the public sector that kind of informs your outlook. We are seeing in the public sector very, very consistent increased demand to get to configurable web-native applications. It's really driven by their need to get to that technology set, but also people constraints in the public sector arena. And the evolution of the software that we've developed over the last several years to support that is being very well received, and we now have enough examples in the market that it's providing additional comfort of certainty of execution. Okay. That's great to hear. And then just one on organic growth. What gives you confidence in that high single-digit organic number? And is there any visibility you might have in terms of those new logos that you're anticipating? I think on previous calls, we spoke to some of the headwinds that we faced in fiscal year 2024. Manitoba was a big one, about $3 million we should have seen in 2024 that can resume now. The SaaS transition was a $5 million headwind. We believe this coming year, our software license sales will be about the same as they were in 2024. Then education, certain states stepped in this last year, but education actually grew 9% in the Q4 as we anniversaried those states stepping in. The last one is our large Midwestern utility customer who we've talked a lot about. We anticipate that growing as well this year. Okay. Thank you. The next question comes from Alex Markgraf with KeyBank Capital Markets. Please go ahead. Hey, everyone. Thanks for taking my question. Maybe just to quickly touch on margin expansion. I think in the press release, it was noted 100 basis points or more. Geoff, I thought I heard you say 50 to 100. I apologize if I misheard you. Just clarification there. And then maybe just walk through some of the sources of that 100-plus basis points for 2025. Sure. So yeah, correct. We said 50 to 100, and this next year, I think we have a pretty easy lift to get to that point. A lot of our margin expansion, we've always kind of cited the fact that our corporate overhead should grow, inflationary rates, and revenue should outpace that. So we should naturally get some margin expansion as that goes. With that in mind, we do see long-term margin expansion, not just kind of a one-year thing, but this year in particular, as we turn the page after the sales of merchant services business, we've got kind of a, because the corporate overhead has come down some, but not pro rata, the increase of revenue just makes a bigger impact on margins than it would have previously. We're still transitioning out some costs, and we're confident in that 50 to 100. It should be a pretty fair target for us to hit. And long run, still feel good about progression on that as well. I might add that our deal didn't close until September the 20th, so we had a full complement of staff all the way through the quarter. Okay. Understood. Thank you both. And then just maybe one quick margin follow-up at the segment level, just around healthcare margins. If you could just add some color on the nature of the delta versus public sector and what sort of margin upside there might be in the healthcare segment over time. Yeah. So the healthcare segment, we have a couple of different services there. A piece of that is outsourced RCM services, which can be an arms and legs business. So there's a disproportionately high number of bodies in the healthcare segment compared to public sector. And as a result, the profile on that revenue is just a lower margin profile. It's a big chunk of revenue. We love it because it is recurring. It's very stable and consistent, but it is a lower margin piece of the business. The growth in healthcare is coming from more of the software pieces. And so over time, I'm hopeful that we can upsize that margin profile in healthcare. We also have some. The RCM business is a space where there's a few things that are in our plans to work on the cost side of that: technology, outsourcing, things like that. Those are some things that will kind of come further into the focus on healthcare over the next couple of years. So we would expect margin expansion over time. Okay. Thanks, Geoff. The next question comes from Peter Heckman with D.A. Davidson. Please go ahead. Hey, good morning. Most of my questions have been asked. One thing I wanted to follow up on in terms of the seasonality commentary you provided, I appreciate that. But anything you would call out there in terms of the timing of relatively larger software payments or milestone payments that we should be thinking about as we map out 2025? That is the software license sales are by far the biggest variable. We currently have a disproportionate amount slated for Q2, the March quarter, and that's why we have 26% in that quarter. That could come early. It could come late. You'll just have to be patient with us. When that happens, we'll tell you it came early, or it came late, or it came on time. Okay. Okay. And then I'm out of the office today, so I don't have access to my notes. But just, can you refresh us on the project for the tier one utility in terms of, I'm not sure I heard Rick's comment correctly in terms of the stage of development and rollout of that. But could you refresh us on that? And then how do you expect, how would you characterize the revenue that you expect to get in 2025 in terms of milestone payments, software versus more recurring revenue streams? Do you want to speak to revenues, or type of revenues? Sure. Yeah. So that project is going to have a little bit of everything in terms of types of revenue. We obviously recognize the $2 million license amount this quarter. That is not the full amount of license. There will be more to come, although probably early in fiscal year 2026, not 2025. So there's nothing modeled in there for additional licenses here. The bigger amounts will come in 2026. We're in implementation mode right now for the first phase of the project. And that's part of why we have a good line of sight towards more revenue in 2025. There's a very healthy amount of professional services revenue attached to this project, and that is ticking up this coming year. It will tick up even further the next year. And then payments is a big piece of the story in the utilities market. It's just a great space for attachment of our payment solutions, and that's relevant here, so we'll have recurring revenue from payments. We'll have recurring revenue from maintenance as well once that turns on, and the professional services, while not necessarily explicitly recurring, are going to be extremely consistent for years to come, so you're kind of touching all things there. As it relates to 2025, basically expect the payments to turn on and expect a really healthy dose of professional services, and then expect all of that to just increase the next year plus license revenue. Okay. That's helpful and good to hear. I appreciate it. As a reminder, if you would like to ask a question, please press *, then one to be joined into the question queue. The next question comes from Rufus Hone with BMO Capital Markets. Please go ahead. Hey, guys. Good morning. Thanks for the question. I wanted to come back on the organic growth. So you mentioned 7.5% organic growth implied for 2025. You just did 2% organic growth this quarter. Is most of that acceleration you're expecting in 2025 just the headwinds you mentioned reversing, or is there some fundamental acceleration you're expecting? Thanks. Our large Midwestern utility customer, that is just a customer that's growing. So that didn't have anything to do with 2024. It's just an acceleration going forward. Education, I mentioned, went back to what we consider a normal growth rate, 9% in Q4. It had a one-time setback in 2024. The SaaS transition levels out. So it's not that it's neither a headwind or a tailwind in 2025. It's just it will stop shrinking in 2025. And then Manitoba is the resumption of, again, kind of a one-time setback. Okay. Thanks. And wanted to ask on healthcare as well. You mentioned low single-digit revenue growth in healthcare in 2025. Is that mostly from the consolidation you referenced, or is there anything else weighing on that segment? Thanks. That's the headwind is consolidation. It's been an ongoing thing in healthcare. We don't see it going away anytime soon. Thank you. This concludes our question and answer session. I would like to turn the conference back over to Greg Daily for any closing remarks. Thank you, everyone. It's nice to have 2024 over. It was a dramatic transformational year, especially a shout-out to the merchant services team led by Tom DeBord. You guys were awesome. You did what was best for the company. I thank you for that. We miss you, and I'm sure you're going to thrive with our good friends at Payroc, but I've been impressed with the conversion. It seems they have gone well, and anybody else on the call has anything of interest? I appreciate you dialing in today. The call is if you need us. Thank you. Thank you. The number for the replay is 877-344-7529, and the code is 4.