Edited Transcript of Stingray Group Inc (Old) earnings conference call or presentation 4-Jun-20 2:00pm GMT

Jul 2, 2020 (Thomson StreetEvents) — Edited Transcript of Stingray Group Inc (Old) earnings conference call or presentation Thursday, June 4, 2020 at 2:00:00pm GMT

Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director

Stingray Group Inc. – CFO

Stingray Group Inc. – SVP of Marketing & Communications

National Bank Financial, Inc., Research Division – MD, Head of Montreal Research & Research Analyst

RBC Capital Markets, Research Division – MD of Canadian Telecommunications & Media Research and Analyst

Desjardins Securities Inc., Research Division – VP, Telecom, Media & Tech Analyst and Intellectual Property Analyst

Canaccord Genuity Corp., Research Division – Associate Analyst of Telecom and Media

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to Stingray Group Inc. Fourth Quarter of 2020 and Fiscal 2020 Results Call. (Operator Instructions) Before turning the meeting over to management, I would like to remind everyone that this conference call is being recorded today, June 4, 2020. I will now turn the conference over to Mathieu Péloquin, Senior Vice President, Marketing and Communications. Please go ahead.

Mathieu Péloquin, Stingray Group Inc. – SVP of Marketing & Communications [2]

Thank you. Good morning. (foreign language) Thank you for joining us for Stingray’s conference call for the fourth quarter results ending March 30, 2020. Today, Eric Boyko, President and CEO and Co-Founder; and JP Trahan, CFO, will be presenting Stingray’s financial and operational highlights.

A press release reporting Stingray’s fourth quarter fiscal 2020 results was issued yesterday after the market closed. Our press release, MD&A and financial statements for the quarter and the full year are available on our investor website at stingray.com and on SEDAR.

I will now give you the customary caution that today’s discussion of the corporation’s performance and its future prospects may include forward-looking statements. The corporation’s future operation and performance are subject to risks and uncertainties and actual results may differ materially. These risks and uncertainties include, but are not limited to, the risk factors identified in Stingray’s annual information form dated June 3, 2020, which is available on SEDAR. The corporation specifically disclaims any intention or obligation to update these forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable law. Accordingly, you’re advised not to place undue reliance on such forward-looking statements.

Also, please be reminded that some of the financial measures discussed over the course of the conference call are non-IFRS. Please refer to the MD&A for a complete definition and reconciliation of such measures to IFRS financial measures. As well, I would like to highlight that on April 1, 2019, the corporation adopted IFRS 16-Leases, using the modified retrospective method. Under this method, the standard is applied retrospectively and the comparative figures for fiscal 2019 are not restated. Please refer to the new standard adopted by the corporation section of the MD&A for further details.

Finally, let me remind you that all the amounts of this call are expressed in Canadian dollars, unless otherwise indicated. I will now turn the call over to Eric.

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [3]

——————————————————————————–

Thank you, Mathieu. Good morning, everyone, and welcome to our Q4 results conference call. With the outset of COVID-19, times have certainly changed since we last spoke. Before I begin, I want to thank all our employees for their hard work and dedication in this period of uncertainty. I know the last few months have not been easy, and I appreciate your commitment and loyalty to Stingray. Considering that our quarter ended in March, our fourth quarter result reflects some impact to COVID-19, while our TV and over-the-top channel registered increased audience in our SVOD B2C spike in subscribers due to the various content initiative and a captive audience in light of COVID-19. Our Radio segment was hit hard at the end of March.

Despite weaker Radio revenues, we are pleased with our consolidated fourth quarter results with an adjusted EBITDA increase of 26% to $28.2 million. In order to respond to the COVID-19 crisis, we decided to act quickly and aggressively with the implementation of significant cost-saving initiatives to maintain our solid financial position. We cut our operating expense by approximately $30 million, of which about 1/3 will remain permanent. This bold move was motivated by our determination to maintain a high level of free cash flow and financial flexibility.

In addition, for our more than 8,000 Radio customers across Canada, we created a Stingray Stimulus Plan, with a minimum of $15 million in radio advertising grants. The purpose of this program is to help struggling small and local businesses to relaunch their businesses by investing in advertising. The response from our customers has been very positive with over 3,500 submissions, allowing our sales force to reengage productive discussions with current and new customers.

Subsequent to the quarter end, Radio revenues continued to decline in April and in May. As the Canadian economy reopens, our retail radio customers have started to reengage to our advertising spend. We know that radio advertising is an effective, and we believe that the advertising revenue decline we experienced in April and May will be short-lived. Well, and we’ll live out in June, and we will trend upward in July and August as consumers across Canada emerge from quarantine and renew their connections with familiar commercial and retail establishments.

Turning now to our full year results. Looking back at fiscal 2020, we are very pleased with our results. It was the first full year of contribution from Radio segment, and it delivered on several fronts, surpassing key metrics in some cases. For the year, revenue reached $152 million and adjusted EBITDA of $58.5 million, while overall annual synergies generally came in at $12 million, double than the original expected.

On the Broadcast and Commercial Music side, revenues reached $154 million, reflecting the acquisition of DJ Matic and Novramedia, combined with organic growth in subscriptions. This was partly offset by the termination of some low-margin international contracts. Adjusted EBITDA increased 20.6% to $63.7 million. We ended the year with about 419,000 SVOD subscribers, up 15% over last year. We also have seen a 6% growth in April and May with continued traction with Qello Concerts and the Yokee apps.

Our recently launched free, ad-supported linear channels on Samsung, LG, Pluto TV and many other platforms are growing above 25% month-over-month confirming our strategy to deploy more ad-based products worldwide. And earlier today, we are pleased to announce the long-term renewal of a partnership with Shaw, our biggest Canadian customer, covering a multiproduct offering. Also in Q4, on the commercial side, we completed the acquisition of Chatter Research, an AI-driven customer insight solution for business to support continued growth in our Stingray Business division.

After the end of the quarter, we also signed a multiyear agreement with Dollarama for in-store music and digital display solution for all of its 1,300 stores across Canada. This agreement shows the value we bring to our customers even in a more challenging time. In the current COVID environment, we became part of the messaging strategy regarding safety measures to adopt in commercial locations.

Stingray Business has a well-diversified and strong customer base, approximately 50% of our revenues come from banks, drugstores and supermarket, while our exposure to apparels is less than 5%. For the year, adjusted free cash flow more than doubled to reach $78.4 million, due in large part to the Radio segment. We used part of that cash to repurchase 3 million shares for a total consideration of $17.6 million as we saw great value in our shares at these levels.

Starting in the first quarter of 2021, we will begin to see the benefits of our cost savings measure. On a short-term basis, our capital allocation will be mainly focused on reducing the debt level and maintaining our dividend. This being said, we could take advantage of attractive tuck-in acquisitions.

We are well positioned to go through the crisis and what follows. We have put in place measures to face expected headwinds and also stimulate our business. At this stage, we are confident that 2021 adjusted free cash flow will remain solid.

And now we’ll turn to our friend, Jean-Pierre, for the financial review.

——————————————————————————–

Jean-Pierre Trahan, Stingray Group Inc. – CFO [4]

——————————————————————————–

Thank you, Eric. Good morning, everyone. In the fourth quarter of fiscal 2020, our revenues decreased 6% to $68.4 million compared to $72.7 million a year ago. The decrease was primarily due to the initial impact of the COVID-19 pandemic on Radio revenues.

Broken down by region, revenues in Canada decreased 8.1% to $43.5 million, representing 62.6% of total revenues, reflecting the initial impact of the COVID-19 pandemic on Radio revenues. In the United States, revenues rose 9.5% to $10.2 million or 15% of total revenues due to the organic growth of subscriptions. Finally, revenues in other countries decreased 8.7% to $14.7 million or 21.4% of total revenues due to the termination of some low-margin contracts.

On a business segment basis, Broadcasting and Commercial Music revenues decreased slightly by 0.6% in the fourth quarter to $38.5 million, primarily due to the termination of low-margin international contracts, partially offset by organic growth in subscriptions. Radio revenues decreased 12% to $29.9 million in the fourth quarter, largely due to the initial impact of the COVID-19 pandemic.

Consolidated adjusted EBITDA for the fourth quarter increased 25.9% to $28.2 million or a margin of 41.3% compared to $22.4 million or a margin of 30.8% a year ago. The increase in adjusted EBITDA was primarily due to the reversal of certain accrued liabilities to reduce operating costs and to the adoption of IFRS 16, partially offset by the initial impact of the COVID-19 pandemic on Radio revenues. Excluding the impact of IFRS 16, the adjusted EBITDA for Q4 2020 would have been $26.6 million with a margin of 39%.

By business segment, Broadcasting and Commercial Music adjusted EBITDA increased 29.6% to $19 million compared to $14.6 million last year. This increase was primarily due to the reversal of certain accrued liabilities and to reduce operating costs.

As for the Radio segment, adjusted EBITDA increased by 7.2% to $9.5 million in the fourth quarter of 2020 versus $8.9 million in the prior year. This increase is primarily due to the reduced operating costs to the adoption of IFRS 16 and to the reversal of certain accrued liabilities, partially offset by the initial impact of the COVID-19 pandemic on revenues.

On the bottom line, the corporation recorded a net loss of $8.5 million or $0.11 per share compared to a net income of $3.9 million or $0.06 per share last year. The difference was mainly due to the negative change in mark-to-market on derivative instruments to the foreign exchange loss and to the gain of write-off balance payable on acquisition recorded in Q4 2019, partially offset by income taxes, recovery and higher operating results.

Adjusted net income was $10.1 million or $0.13 per share compared to $14.7 million or $0.21 per share a year ago, mainly due to the foreign exchange loss and to the gain of write-off of balance payable on acquisition recorded in Q4 2019, partially offset by higher operating results.

Turning now to liquidity and capital resources, cash flow generated from operating activities amounted to $14.1 million in the fourth quarter of fiscal 2020 compared to $18.1 million a year earlier. Adjusted free cash flow almost doubled to $18 million in the fourth quarter compared to $9.8 million for the same period a year ago. The increase was mainly related to higher operating results and to lower income taxes paid.

Turning to our balance sheet. At the end of the fourth quarter, the corporation had cash and cash equivalent totaling $2.5 million, subordinated debt of $39.6 million and credit facilities of $365 million, of which $25.2 million was available.

Total net debt at the end of the quarter stood at $361.2 million or 3.01x pro forma adjusted EBITDA ratio. Since March 31, our liquidity has improved, and as of today, we have $70 million available, including a new term loan of $20 million, which was secured on May 29.

This concludes my remarks, and I will now turn the call back to you.

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [5]

——————————————————————————–

Okay. Thank you, JP. This concludes our prepared remarks for today. Thank you for your time and attention, and thank you for joining our conference call today. And our next meeting will be August 4. So now we’re open for analyst questions.

================================================================================

Questions and Answers

——————————————————————————–

Operator [1]

——————————————————————————–

(Operator Instructions) And our first question comes from the line of Adam Shine of National Bank Financial.

——————————————————————————–

Adam Shine, National Bank Financial, Inc., Research Division – MD, Head of Montreal Research & Research Analyst [2]

——————————————————————————–

So Eric, you touched on some of the SVOD traction, and there’s been a lot of initiatives that you’ve been highlighting over the last few weeks, maybe just as a starting point, and I’ve got a couple of other questions. But as a starting point on SVOD, can you talk about perhaps some of the follow-through with regards to those that tried the various apps during sub-varying free periods in, let’s call it, April and how some of those have stuck around deeper to May and early June?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [3]

——————————————————————————–

Yes. No, for sure, like Netflix and all the over-the-top platform, SVOD increased about 7%. We’re already around 440,000 subscribers. So we had a big increase and even a stronger ARPU. B2C also very strong, and we see this traction going into June. One of our partners, and this will become our biggest customer, Amazon. Amazon is growing for us. The Amazon channels has bought almost 20% month-over-month. So those numbers are impacting us a lot. And we’re pleased also to announce that we’re also going to be launching with Amazon Japan, which is their second biggest country in the world after the U.S. So our Qello products and our different products are doing well. And Qello by itself is a big surprise. A lot of people want to watch concerts, but can’t go to concerts. So Stingray is luckily positioned and that product line is we’re seeing double digits growth.

——————————————————————————–

Adam Shine, National Bank Financial, Inc., Research Division – MD, Head of Montreal Research & Research Analyst [4]

——————————————————————————–

And just in terms of the customers sort of copy back and paying. You’re managing to convert these to successful paying subscribers?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [5]

——————————————————————————–

Absolutely. It’s all of our campaigns are working well right now. And all of the Qello products, by the way, is all organic growth because we don’t spend much money of user acquisitions on Qello. So I think we’ll see, but right now, it’s really — conversion is great. And for sure, we’re going to see post COVID if people still maintain their subscription. But for now, it’s a net positive every week.

——————————————————————————–

Adam Shine, National Bank Financial, Inc., Research Division – MD, Head of Montreal Research & Research Analyst [6]

——————————————————————————–

So if we turn next to one of the other growth vectors that you’re talking about in the context of advertising, this is a number that, obviously, you sort of targeted at $5 million, but I think that has scaled up, by my math, maybe if we add Dollarama to the equation and then you split there with Bell, maybe you’re tracking at this point annualized to about $5 million or so. So maybe you can speak to my math and also touch on perhaps where you see things going at least over the next year plus?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [7]

——————————————————————————–

Yes. So good questions, Adam. So if you look at our advertising on the FAST channels are the free advertising based channels on Samsung, LG, Vizio and all the platform worldwide. We started that in November with 0 hours of listenership, and we almost finished last month at 1 million hours. We — our revenues per hour are anywhere between depending of USD 0.12 to USD 0.20. So that division alone, just that product is going to be generating USD 200,000 a month right now. That’s an example of a product that did not exist advertising base 6 months ago organic sales. So very confident on that growth. And that is LG and Samsung, our worldwide partners. We’ve launched in Europe. We’ve launched in Canada, U.S. We’re launching in Latin America. So I think that for sure, I think, the advertising segment for Stingray will be our biggest growth vector on the broadcasting side for the next 3 years. Absolutely so. The $5 million, I think we’re more of a run rate, I’d say, between $6 million to $8 million coming up this year and maybe even higher depending on if we are able to maintain the month-over-month growth that we — like we see, like we mentioned. I think May over — the May results over April was a growth of 37% month-over-month. So that, again, we’ll see post COVID if that maintains.

——————————————————————————–

Adam Shine, National Bank Financial, Inc., Research Division – MD, Head of Montreal Research & Research Analyst [8]

——————————————————————————–

Okay. And just lastly, there’s been chatter about privatization, maybe starting from a year ago. I know it sort of came to the fore a week or so ago. And maybe it’s now publicly being discussed. I don’t think it’s something the Board is looking at imminently, but maybe if you could just characterize some thoughts around some of that chatter?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [9]

——————————————————————————–

Yes. Absolutely. For us, and when we meet with all you — all the analysts. As you know, any company that trades at a cash flow yield above 15, there’s always a discussion about that. The insiders and the Board members and the management, we own 43 million shares out of 71 million. So we own more than 60%. So for sure, if we are not able to trade a multiple of cash flow yield of 15 or below, then it’s going to be one of the options that any company would look into in our situation.

——————————————————————————–

Operator [10]

——————————————————————————–

And our next question comes from the line of Deepak Kaushal of Stifel GMP.

——————————————————————————–

Deepak Kaushal, Stifel GMP Research – Director and Technology & Communications Analyst [11]

——————————————————————————–

I’ve got a handful, a bit all over the place. Eric, just quickly in terms of the numbers, you gave us a sense of your cost-cutting efforts and outlook on free cash flow to be solid. Any more precision you can give us in terms of an EBITDA range or free cash flow per share range that you’re targeting, as you’ve given us in the past?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [12]

——————————————————————————–

No. Last year, it was — I think, we’re all happy as management because we always — last year was the pro forma before we finished the year. We always told the market that we expected EBITDA to $115 million to $120 million. We finished at $118 million. And we always said, we expect our free cash flow per share to be at $1 plus, we finished at $78 million. We have 71 million shares for a $1.08. So we’re really in a range of what we told the market. And for this year, one thing that we sell is going to be tough to predict. But for sure with our cost savings and with our initiatives, lower interest rates because we’re able to have a good deal last year. We’re keeping our CapEx lower. Very confident to have a range of EBITDA this year to be between $70 million to $80 million. So even if the pandemic gets worse and all that…

——————————————————————————–

Unidentified Company Representative, [13]

——————————————————————————–

Free cash flow.

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [14]

——————————————————————————–

Yes, free cash flow. So the good news about Stingray, we’re easily able to manage our free cash flow, we’re able to limit our CapEx. But for sure, long term, we’ll have to invest in CapEx. We will have to hire more people, we’ll have to deploy, like I said, we’re not going to become the next Google by cutting costs all the time. It is a short-term measure, and we want to be back in force in September. That’s one of the reasons we got the extra money from the banks. Thank you for all the banks, by the way. All the big banks in Canada gave us an extra $20 million of availability last week. We have $70 million available. So very confident for the next 12 months.

——————————————————————————–

Deepak Kaushal, Stifel GMP Research – Director and Technology & Communications Analyst [15]

——————————————————————————–

Okay. And just to clarify, you said $70 million to $80 million adjusted free cash flow, right not EBITDA?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [16]

——————————————————————————–

Yes.

——————————————————————————–

Deepak Kaushal, Stifel GMP Research – Director and Technology & Communications Analyst [17]

——————————————————————————–

Okay. And then in terms of the adjusted — on the adjusted free cash flow, it looks like receivables spiked and DSO spiked, but it sounds like, JP, from your commentary, you got about $30 million incremental back from working capital, excluding the extra $20 million from line of credit. Is that my understanding?

——————————————————————————–

Jean-Pierre Trahan, Stingray Group Inc. – CFO [18]

——————————————————————————–

Yes.

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [19]

——————————————————————————–

And for sure, we had an incredible 8 weeks. Usually, we generate, after dividend, about $5 million of free cash flow a month. In the last eight weeks, we generated more than $20 million. First of all, the cost measures, less CapEx, the wage subsidies, the wage subsidies also coming quickly.

——————————————————————————–

Jean-Pierre Trahan, Stingray Group Inc. – CFO [20]

——————————————————————————–

We don’t travel.

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [21]

——————————————————————————–

Yes. So it’s been a very good 8 weeks during the pandemic to generate so much cash flow, and we applied $20 million against our debt. So our debt today is sitting more around $340 million. So very impressive what we can do if we decide to repay our debt.

——————————————————————————–

Deepak Kaushal, Stifel GMP Research – Director and Technology & Communications Analyst [22]

——————————————————————————–

Okay. Excellent. And I have 2 bigger picture questions, Eric, for you, now that I’ve got the numbers out of the way. In the commercial music business, you signed Dollarama. What are some of the permanent changes you’re anticipating in the retail environment? And how does that create opportunities or challenges for the commercial side? And then I have a follow-up on the U.S. market.

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [23]

——————————————————————————–

Yes. So a very good question. Yesterday, just at our Board meeting, we invited the commercial team, leadership team to present to the Board. Because most people expected that commercial business will be declined. You hear all the — ALDO is a customer, WriteMin is a customer, (inaudible) is a customer. So — but on the opposite side, I’d say, for sure, we gave a lot of credits. We probably gave about $0.5 million of credits per month for our customers because they were closed. So we were happy to be partners with them. We were ready for going to offer them these credits. But Dollarama is a great example. Dollarama, Montreal based, we’ve been talking to them for 10 years, and they called us and they wanted all the stores connected in 3 weeks because they want to be able to do messaging about the safety of their employees. So Loblaw, Sobeys, Metro, all the shoppers were using our services to message their people. So we’re going to see, I expect double-digit growth and more because everybody wants special signage. They want their music and messaging. And when we say messaging is you’re allowed to, if you’re a store say, don’t worry, there’ll be goods next week in the store. So it’s like internal advertising. So I feel that we became an essential service. So very excited about that. And Dollarama for us is a great win. And also, we just launched Metro, another 1,200 stores. And I think you can expect a lot of nice growth for commercial business. For sure, we’re going to lose 8% of our customers. We estimate that we’ll lose about $160,000 to $200,000 a month of recurring revenues. But with our new deals, we have about $400,000 to $600,000 of new recurring revenues. So we’re coming out well ahead.

——————————————————————————–

Deepak Kaushal, Stifel GMP Research – Director and Technology & Communications Analyst [24]

——————————————————————————–

Okay. Excellent. And then just my last one, if I may, on the U.S. market. Good growth there. How has this COVID disruption changed the competitive dynamics there and the way you approach your market. Anything to note there?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [25]

——————————————————————————–

For us, the U.S. market is going to be, by far, our biggest growth. A, because SVOD, as you know, we are having double — more than double-digit growth in all our SVODs, plus the FAST channels, which is all — I think the FAST channels, one of our goal is to try to hit a run rate of USD 400,000 a month of revenues. So just the FAST channels will be USD 5 million, let’s say, quickly CAD 7 million. So just that it’s going to be an incredible growth for the U.S. market. And the push from — we are — we do more sales in the U.S. on over-the-top than we do on TV — cable TV. So all Amazon, LG, all these partners are having a higher increase than we’re having with the pay TV side. And hopefully, the dollar stays strong for us. A strong dollar is good news for Stingray. When I say a strong U.S. dollar, just to confirm.

——————————————————————————–

Deepak Kaushal, Stifel GMP Research – Director and Technology & Communications Analyst [26]

——————————————————————————–

Okay. Excellent. Maybe I’ll leave the foreign exchange or the derivative loss for later on the Forex, but…

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [27]

——————————————————————————–

No, no. Yes, the derivative loss, it’s a big impact. As you know, we told last year, we fixed our interest rates at very low 3.2% for about 10 years. So we were making money because the interest rates were higher. But with the pandemic, there was a quick downturn, which created an unrealized loss of $22 million. So our net income would have been plus $16 million, if it wasn’t for that, but that’s a fully hedge product. So at the end of the day, we’ll finish at 0. So for now, it’s going to go up and down and it does — there’s an impact on net income. But as you know, there’s no cash flow impact. So — and we’re very happy with our rates at 3.3%. So it’s not — I think we made the right decision. So happy with that stability.

——————————————————————————–

Operator [28]

——————————————————————————–

Our next question comes from the line of Matthew Lee of Canaccord Genuity.

——————————————————————————–

Matthew James Lee, Canaccord Genuity Corp., Research Division – Associate Analyst of Telecom and Media [29]

——————————————————————————–

Can you maybe talk about the international contracts that were ended and how much they impacted broadcasting revenue in the quarter? And following up on that, you’ve talked about good growth in commercial music. Can you maybe give a ballpark range for the Broadcasting commercial music segment revenue growth for F ’21?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [30]

——————————————————————————–

Yes. So a good question. On the international side, where we did a lot of decrease or cuts of products was in Asia. As you know, a lot in that location, we use a lot of satellites. Satellites are very expensive. So if you start losing a bit of sales and your satellite costs are fixed, then you become almost — the product has almost negative gross profit. So we shut down few of our satellites, a few of our products to focus more on over-the-top delivery, where, in that case, it’s 100% variable cost. And so that’s where we had an impact. And we also had an impact in the Netherlands. One of our customers there with Ziggo in Netherlands. So those are the 2 impacts. The good news is that those finished March 31. So starting April 1, we’re going to see net positive organic growth in Europe and Asia. And I’d say in both locations, we’re going to see 10%-plus organic growth. So we’re excited for that because Europe for us has been a bit of a flat-to-negative for the last 3 years. And now Europe is going to be part of the winning team of Stingray. So — and same thing with Asia. But again, Asia, we do about $100,000 of revenues a month. So Asia is not a big division. It’s $1.2 million of sales a year. So I don’t want to get you too optimistic. And your second question was?

——————————————————————————–

Matthew James Lee, Canaccord Genuity Corp., Research Division – Associate Analyst of Telecom and Media [31]

——————————————————————————–

Yes. Just on the overall growth for F ’21 on Commercial Music and Broadcasting that…

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [32]

——————————————————————————–

Yes. Last year, we did around $50 million in that unit of sales in the Stingray business, music, and also we have digital signage and surveys with Chatter. And we expect double-digit growth or more in that division this year. The pipeline is huge. Many large accounts that we’re winning, both on equipment and labor with less margin, but on the recurring side. So we feel very confident. For sure, April, May and June, we’re going to have about $1.5 million to $2 million of credits but those are one times, and we’re happy to help our clients. And also very excited about the deal we did in Mexico. The deal in Mexico was 5,000 locations. It’s 2 big brand name, it’s Scotiabank. So a great partner for us for Latin America. And Santander bringing us it’s going to be about $300,000 a month of new sales. And with the synergies, we expect that to be about $2 million of EBITDA. And now we officially have an office in Mexico, and we see a lot of growth coming from that market. And same thing, a lot of good potential for Stingray business in Europe. We see a lot of international accounts that we’re able to win. So I think that you will be happy, and the market will be happy with some of the big names that we’re signing in the next few months.

——————————————————————————–

Matthew James Lee, Canaccord Genuity Corp., Research Division – Associate Analyst of Telecom and Media [33]

——————————————————————————–

Great to hear. And on the Radio side, I mean, you kind of discussed an improvement in the Radio segment in May that you’re starting to see. Can you maybe help us understand the cadence of that recovery? I mean is that mostly small businesses coming back? Or is that your national brands asking for more advertising or maybe both?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [34]

——————————————————————————–

Yes. In the Radio, we have to be very careful. The TRAM reports, which shows the market was down about 60% in April, so 6-0, not 6. The TRAM is all the radio stations in the Canada. So I’d say it’s going to be a slow recovery right now. We really — for the Radio side, it’s very simple. We need the stores to reopen and commercial locations to reopen across the country. So province by province, they’re slowly reopening. But until that happens, you’re not going to see recovery because if your stores are closed, you’re not doing advertising. And if you’re Loblaws and Sobeys and the big guys, you already have a lineup outside, so you don’t want more people in the lineup. So for sure, in the middle. But we’re very lucky to have the wage subsidies from the federal government, which offsets during this period. So for us, the big question is, are we going to be back in full force by September? So that, for us, as a management team and our Board is what we’re more focused on. Short term, we’re here to help our customers. As we said, we gave $15 million of stimulus. So — and the good news is in many cities and our Radio management team, we’re having a lot of new customers calling us because they appreciate that we’re helping them in Sudbury, in Kelowna, in Dartmouth and every city across the country. So it’s good that — but for now, we don’t — we’re not seeing amazing numbers in May also. So don’t expect great results.

——————————————————————————–

Operator [35]

——————————————————————————–

And our next question comes from the line of Tim Casey of BMO.

——————————————————————————–

Tim Casey, BMO Capital Markets Equity Research – Equity Research Analyst [36]

——————————————————————————–

Eric, how did — have you seen the trend improve for May, where it was down another 50%, just following up on the Radio.

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [37]

——————————————————————————–

I think it’s going to be also below 50%. We haven’t seen the TRAM report yet, but we’re going to still be in May below 50%. And again, we don’t — until the stores reopen, we don’t expect it to be better than that. So even for June, until we get a better feeling. So on the good news side, our AUDIO360 product has a lot of traction. We have a lot of good deals to announce. But again, these partners are waiting for the recovery. So I think our AUDIO360 will be able to announce a few nice deals in the next few months. But all these deals are on hold or delayed until the — all the stores are reopened. So again — sorry, Tim.

——————————————————————————–

Tim Casey, BMO Capital Markets Equity Research – Equity Research Analyst [38]

——————————————————————————–

How long the wage subsidies from the federal last?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [39]

——————————————————————————–

Yes. In our case, the wage subsidies will last, we are — how can you say, we qualify until the end of August. The wage subsidies is pretty material for Stingray. It’s about $8 million a quarter. So in Q1, we’re going to receive $8 million, and we also qualify in Q2. So we feel we’ll qualify another $8 million. So that’s why that really offsets the losses of sales in Radio, but long term, the wage subsidies are nonrecurring. So that’s why we are more focused on what’s going to happen in September. For the short term, we’re fully — as you can see with our cash flow generation in the last 8 weeks, we’re fully protected. And so — and that’s why we kept most or all of our employees because the program from the federal works well. And so I don’t know if that answers your question, Tim?

——————————————————————————–

Tim Casey, BMO Capital Markets Equity Research – Equity Research Analyst [40]

——————————————————————————–

Yes, it does. On Dollarama, can you — are you able to quantify what the impact will be on the financials? And can you talk about the term of the contract? And I think you mentioned a very quick rollout, but how does the model work on a go-forward basis?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [41]

——————————————————————————–

So roughly, you can estimate about an ARPU, and our ARPU is around $35 to $40 a store, and it’s more like — all of our deals roughly are 5-year deals. We don’t — one of the reasons why I don’t want to say the terms is because we don’t want our competition to know and they might again start calling our partners. So — but all deals are 5-year deals, $40 — so it’s about $0.5 million a year, so — but it’s also great because we will be doing messaging, and we charge per message. And the messaging could be anywhere depending on number of stores of 30,000 to 50,000 per message. So it’s very — so it’s a good margin business for Stingray, and that’s why we’re very proactive to connect all the stores. And I think you’ll see our Sobeys, Loblaws, Metro, all the grocery stores want to have the connected device which they are not right now. So we’ll have a lot of deployment coming out because they want to be able to send one message to all those stores at that period. So they want to — that’s why being connected is so important. And we still have, believe it or not, Tim, device that we send the CD cards. We have 4,000 machines that we send CD cards every month. So the good news is everybody wants to be connected now.

——————————————————————————–

Tim Casey, BMO Capital Markets Equity Research – Equity Research Analyst [42]

——————————————————————————–

And are they — is this — is the connectivity with your existing customers, is that all prospective? In other words, that’s incremental to what’s in the business right now?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [43]

——————————————————————————–

Yes. The good news is once we’re connected, we can do messaging. And messaging is a big profit center for us. So that’s very good. And also with messaging, there’s less cost of operation because you’re streaming when you’re connected. So streaming is a lot less cost than — we spend maybe $40,000 a month on FedEx. So it’s $0.5 million a year shipping those CD cards. So there’s a big saving, and it will improve our margin.

——————————————————————————–

Tim Casey, BMO Capital Markets Equity Research – Equity Research Analyst [44]

——————————————————————————–

No. But I mean none of them are connected now. That’s all…

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [45]

——————————————————————————–

Yes. That’s — I’ll tell you an example, a bigger grocery store will have out of 1,200 local stores, 800 connected, 400 nonconnected so those are the ones that we will need to reestablish.

——————————————————————————–

Tim Casey, BMO Capital Markets Equity Research – Equity Research Analyst [46]

——————————————————————————–

Got you. Okay. And then what about on the M&A pipeline? Is there anything you can talk about there? Or do you think this is more a period to just sit back and wait and see how things progress in the fall?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [47]

——————————————————————————–

Very good question. So the same thing I said to the Board yesterday. Right now, for sure, June, July and August, we’re going to be a few tuck-ins like we did in Mexico. So there might be a few tuck-ins and the EBITDA — the EBITDA ratio we pay for them are below 3, so not to increase our debt to EBITDA level. But we’re getting ready cash flow-wise, and that’s why we got the extra credit from the banks, and including BMO. So thank you. And so we have $80 million that — no, $70 million, sorry, that we have. So we’re positioned for the fall, September, October, November, December.

——————————————————————————–

Operator [48]

——————————————————————————–

Our next question comes from the line of Bentley Cross of TD Securities.

——————————————————————————–

Bentley Cross, TD Securities Equity Research – Equity Research Associate [49]

——————————————————————————–

There’s been a lot of talk on this call about the commercial side of the business, and it seems like that increasingly is an area of growth. Wondering when the noncompete with Mood expires and your ability to expand in the U.S. to a greater extent?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [50]

——————————————————————————–

Yes, a very good question. That’s — so our deal with Mood finishes in December. We’ve already told our partner that we want to not be a franchisee or deal with them, we’re exclusive in Canada, they’re exclusive in the U.S. for music. So that for sure is a big move for Stingray. It was a long-term partnership, almost more than 10 years with Mood. But that gave us access to international customers. Right now, we want to allow to bid on big chains, Starbucks, imagine Subway or any big customer because we couldn’t service the U.S. So a strong international partner will have not 1,000 locations, but 10,000 locations. So for sure, we see a lot of growth internationally, and we’re negotiating with a big retailer right now with over 3,000 locations based in Denmark. So we have a footprint in Europe. Don’t forget, we have 10,000 locations in Europe, in Canada, in Mexico and in Australia. Stingray is well positioned to become the #1 commercial music provider in the world. So we’re #2 right now. We have about 100,000 locations, Mood has 0.5 million locations. So a lot of growth there. So — and the U.S. market for us will be all organic.

——————————————————————————–

Bentley Cross, TD Securities Equity Research – Equity Research Associate [51]

——————————————————————————–

And just on the renegotiated Shaw deal, should we expect some near-term pressure and then hopefully some lift as you get advertising revenues in there? Or were you able to initiate that on more favorable terms?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [52]

——————————————————————————–

No. Shaw, I want to reaffirm, it is, by far, our biggest Canadian partner. We’ve been in long relationship with Shaw. Don’t forget we bought Max Trax from them in 2008 because we bought Galaxie from CBC, then we bought Max Trax, so which was one of their — it was owned by Corus. So it was a great deal. On this case, no, our ARPU remains stable, even a small increase, no short term pressure, plus organic sales because they’ll be launching all our SVOD products. And they carry all of our music video lines, which we started monetizing with advertising.

So in Canada, for the first time in 3 years, we expect to have positive organic growth even — and even surprisingly, in April and May, TV subscribers increased. So we didn’t have a decline and TV subscribers increased also based on the fact that their Rogers, Vidéotron and Shaw with the new X1 platform have been doing aggressive marketing and people are subscribing to their new Ignite in Québec, Helix and all those products. So we’ll see if this is only COVID. But very happy, and with Shaw it is a long-term partnership. So we’ll stay for the next 4 to 5 years.

——————————————————————————–

Bentley Cross, TD Securities Equity Research – Equity Research Associate [53]

——————————————————————————–

Okay. And then lastly, a bit of an oddball question. On AppDirect what’s your commitment to keeping that around? Or is that a monetizable asset?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [54]

——————————————————————————–

Yes, AppDirect, it’s a good question because that business, again, it’s not the model of Stingray. This was a bit of a — we bought that in — we invested that in 2008. It was more for — and then we invest, I think, $100,000. It’s — we own about 2%. It’s worth about USD 20 million based on the last round. So we put a discount in our books about 25%. So for sure it’s USD 20 million. We’ll see what happens. But that business is doing well. So like all the over-the-top products are they’re doing well. And if there is a secondary round happening, we will, for sure, be taking advantage of that because we’re not a VC firm. So we’re not here to be a — so for sure, if we can monetize it, then we’ll use that USD 20 million, let’s say, CAD 25 million and we’ll just pay down the debt. So our debt would be down to closer to $300 million. And if our EBITDA maintains at $120 million, will be closer to the 2.5.

——————————————————————————–

Operator [55]

——————————————————————————–

And our next question comes from the line of Drew McReynolds of RBC Capital Markets.

——————————————————————————–

Drew McReynolds, RBC Capital Markets, Research Division – MD of Canadian Telecommunications & Media Research and Analyst [56]

——————————————————————————–

Maybe just 2 to start off with for you, JP. Is there a number or range that you can give us for CapEx in fiscal 2021? And on the reversal of accrued liabilities in Q4, can you just give us a little bit more granularity on what those are related to?

——————————————————————————–

Jean-Pierre Trahan, Stingray Group Inc. – CFO [57]

——————————————————————————–

Québec was still low because we’re very — we want to be safe, between $1 million, $2 million — $1 million for Radio, maybe $1 million or $2 million for us max for this year.

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [58]

——————————————————————————–

So CapEx last year was $16 million take around. And so the CapEx this year, we have R&D CapEx, which is we capitalize our software, so that’s about $6 million to $8 million a year, and we expect another about $6 million, $3 million plus $3 million, so I’d say between the $12 million to $14 million range, Drew. And Drew, just for your second question, in our business, we put marketing accruals, the rights accruals throughout the year. And at year-end, when we get audited by KPMG, then we clean the books…

——————————————————————————–

Jean-Pierre Trahan, Stingray Group Inc. – CFO [59]

——————————————————————————–

We clean the balance sheet.

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [60]

——————————————————————————–

We clean the balance sheet. So it’s all smart accruals, marketing, rights, legal fees that didn’t happen. So we try to clean the books at the end of the year. So every year — the good news, every year, we have a positive accruals. So I think we should get used to that word. We’re trying to be conservative during the year. And at year-end, we try to have everything perfect. So — but we’re more conservative generally in the last few years.

——————————————————————————–

Drew McReynolds, RBC Capital Markets, Research Division – MD of Canadian Telecommunications & Media Research and Analyst [61]

——————————————————————————–

Okay. That’s great. Maybe one final question for you, Eric, just bigger picture back on the M&A side. Just remind us kind of where some of the areas that you’re looking at? Some of your music peers have kind of begun to dabble more aggressively on podcast and doing exclusive deals, and I know you’ve kind of gone down that route as well recently, would love to get your updated thoughts?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [62]

——————————————————————————–

Yes. So podcast, we took a position in TPX, the biggest podcast exchange in Canada, well, probably the only podcast company making money. So that doesn’t make much money, it’s about 2.5 to 3 in sales and breakeven. I understand the strategy for Spotify, the podcast deal they did. They’re trying to do like the Howard Stern with XM Sirius. This is not our strategy. So we’re very strong. We’re very focused for Canada. We dipped our toes with a small investment. We don’t see podcast right now to be EBITDA positive. And until we get more clarity on that, we’re not going to be taking a big risk on that market. We saw many companies from LA all over the U.S. that came to Montreal. But we don’t see it to be profitable in the short term. And Stingray, as you know, is very EBITDA-focused. And we’re very happy with our partnership and our investment in TPX. And I think we have, by far, the best team in Canada and the best publishers.

——————————————————————————–

Operator [63]

——————————————————————————–

And our next question comes from the line of Maher Yaghi of Desjardins.

——————————————————————————–

Maher Yaghi, Desjardins Securities Inc., Research Division – VP, Telecom, Media & Tech Analyst and Intellectual Property Analyst [64]

——————————————————————————–

I wanted to just make sure I understand the assumption maybe underlying the $70 million to $80 million free cash flow expectation for 2021. What does that imply in terms of recovery in Radio, in terms of federal government support on payroll and growth in commercial?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [65]

——————————————————————————–

Yes. So we had — for the bank refinancing, as you can imagine, we had to give our new models. So for sure, we were very conservative on the Stingray Business side. We said, okay, we’re going to lose $5 million doing business. On the Radio side, we put the worst-case scenario that the pandemic will last for 6 months. So we took away about 40% of our sales. But then you get the subsidies from the government. So all in all, we’re still maintaining free cash flow above $70 million. We hope the pandemic won’t last 6 months, that means stores closed for us, means stores that are closed. So we don’t — we were in worst-case scenario. And Stingray Business, instead of being minus $5 million, we feel we’re going to finish this year double-digit growth. So we model both things, and that model brings us anywhere from $70 million to $80 million. So we’re very — and also we’re lucky or it’s — I guess it’s edge of our business. We’re seeing double-digit growth in all of the over-the-top and broadcasting and streaming. Sorry just a renovation above us. So…

——————————————————————————–

Maher Yaghi, Desjardins Securities Inc., Research Division – VP, Telecom, Media & Tech Analyst and Intellectual Property Analyst [66]

——————————————————————————–

Yes, I can hear that. So…

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [67]

——————————————————————————–

It’s not us. It’s one of our other tenants that — and we did ask them not to renovate between 10 to 11.

——————————————————————————–

Maher Yaghi, Desjardins Securities Inc., Research Division – VP, Telecom, Media & Tech Analyst and Intellectual Property Analyst [68]

——————————————————————————–

So bottom line, basically, you’re assuming Radio to get back into a more normal kind of range in September, and you won’t need the support from the payroll subsidy from the government at that point?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [69]

——————————————————————————–

Absolutely. So we put the worst-case scenario that these last stores were closed until the end of September, and we’re back in business across Canada in October. So I think we gave ourselves, we’re very, very conservative. And I think we’re positive that we won’t need that this won’t happen. But still, we had to model everything. As you know, banks, including Desjardins, by the way, was a strong supporter. So very happy to get the financing in the middle of COVID. So I think it shows a strong confidence in our model, our free cash flow and the Stingray recurring revenues.

——————————————————————————–

Maher Yaghi, Desjardins Securities Inc., Research Division – VP, Telecom, Media & Tech Analyst and Intellectual Property Analyst [70]

——————————————————————————–

Okay. And in terms of the cost savings that you have implemented, can you — how much of those cost savings are dependent on the business being in pause mode, let’s say, waiting for the pandemic to get off versus permanent in nature?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [71]

——————————————————————————–

Yes. The cost savings, most of it, it is temporary. We did cut salary costs for employees, management, minus 20%; executive team, minus 25%; and myself, I took a 75% pay cut. Those remain in place for the executive team and management. So we’re taking — we’re doing it for the good of the company. But that is temporary and our goal for that, we also stopped on new hiring, travel. So long term, we’ll need to travel. We need to meet our customers, we’ll need to meet Samsung and meet Tesla and meet Porsche in Germany. So it’s not sustainable. So out of the $30 million, about $10 million of it is, when you do spring cleaning, there is some recurring savings. So we expect about $10 million of the $30 million will be recurring. It’s not employee cost, but it’s us looking at all the different services and that we offer that will be — that will be recurring. So the good news is we got — we were able to save an extra $10 million.

——————————————————————————–

Maher Yaghi, Desjardins Securities Inc., Research Division – VP, Telecom, Media & Tech Analyst and Intellectual Property Analyst [72]

——————————————————————————–

Okay. Great. So $10 million is permanent, let’s say, $20 million is dependent on when we recover. Okay. And when it comes to your SVOD business, you have had a few products with the free membership for a month in the market. Can you talk about the churn rate on those products? Have you — now that — I don’t know if — I don’t think we are off the 30 month — the 30 days yet, free offers on some of these products already. But if so, what’s kind of the churn rate on them?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [73]

——————————————————————————–

Yes. So a very good question. But as you know, on the B2B side, we don’t see the — we get to see the net number. So very — we don’t know which cohort is — we just get — you had 10,000 subs, you have 2,000 more, you lost 500, you had 11,500. So…

——————————————————————————–

Maher Yaghi, Desjardins Securities Inc., Research Division – VP, Telecom, Media & Tech Analyst and Intellectual Property Analyst [74]

——————————————————————————–

No, no. Which one…

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [75]

——————————————————————————–

No. So that’s why on the B2B side. On the B2C side, we see it, but it’s much smaller numbers. All we can say is that for our big platforms, Comcast and Amazon, with this free platform that we did, we increased ourselves between 10% to 20% in 1 month. So it was a very good program campaign. It worked very well, but we don’t have those churn numbers for you. And roughly, we — our churn is about 10% to 12% generally on the B2B side. So it is our churn. But believe it or not, we’re better than most other micro SVOD services, so I was surprised that we’re seen as a top-tier micro SVOD service.

——————————————————————————–

Maher Yaghi, Desjardins Securities Inc., Research Division – VP, Telecom, Media & Tech Analyst and Intellectual Property Analyst [76]

——————————————————————————–

Okay. Okay. And my last question is pertaining to the Canadian and the TV, basically, the North American TV subs that you have. Some cable companies are not dropping off customers, even though they ask for not to have TVs in order to retain them on account and just hold on to the Internet and phone. Potentially after the pandemic, they might change their mind. So they’re not registering those subs as a loss on TV. Do you still get paid if a customer drops their TV, not pay for it, but still gets it for free?

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [77]

——————————————————————————–

Yes. So we’re always more or less on basic cable in Canada. So we have that advantage. The fact that they pay, not paying all that, we get our CPS fee and like I said, for the first time in maybe 5 years or I can’t even remember there maybe more than that, we’ve seen an increase in TV subscribers in Canada with our partners. So is it going last, not a big increase, but it’s still plus 1%, but we’re not seeing the negative trend. So that’s why we’re very positive for this year that Canada will have a strong organic sales which we didn’t see over the last few years on the TV side. So — and also with all our new products, also our new SVOD launching, like we did with Rogers yesterday. That’s all positive organic. So no so far the TV side broadcasting has been all good news.

——————————————————————————–

Operator [78]

——————————————————————————–

And there are no further questions in the queue at this time. I will turn the call back over to Eric Boyko, CEO.

——————————————————————————–

Eric Boyko, Stingray Group Inc. – Co-Founder, President, CEO & Non-Independent Director [79]

——————————————————————————–

Thank you very much all of the analysts for your time. We’re lucky for — we’re saying before the call today. For a small company, we appreciate to have so many analysts and banks and groups covering us. We appreciate your time. I know you guys are busy, and you’ve got all the big guys, Bell and Telus and Rogers and Shaw. So we’re happy you can spend the time with some smaller guys. So I appreciate your time, and thank you all.

——————————————————————————–

Operator [80]

——————————————————————————–

Ladies and gentlemen, this concludes today’s conference call. Thank you for participating. You may now disconnect.

Laisser un commentaire