Leland Strange - CEO Karen Reynolds - CFO Bonnie Herron - Former CFO.

Sam Robotsky - Private Investor.

Good morning. My name is Kim [ph] and I will be your conference operator today. At this time, I would like to welcome everyone to the Earnings Release and Investors Conference Call. All lines have bee placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session.

[Operator Instructions] Thank you. Leland Strange, CEO of Intelligent Systems, you may begin your conference, sir..

licensing, processing, professional services. However, we will continue to incur expenses in our corporate offices related to being a public company that will impact the CoreCard results, but the CoreCard operations by themselves have turned the corner and are highly likely to be profitable for the full 2016 year.

So, with that quick overview summary comments, I'm going to open it up to see if there are any questions..

[Operator Instructions] And your first question comes from the line of Sam Robotsky. Your line is open..

Yeah, good morning, Leland and Bonnie, and welcome Karen..

Thank you. .

Thank you. .

So, let's see.

We consider the possibility of being profitable and it appears you're going to have more revenue in the second half than the first half, is there something that we need to do to generate greater revenue, or is there more salespeople we need to hire, or what do we need to do to sort of increase the revenue stream for the processing?.

Yeah, the only place that really matters is in the processing, that's where you get the leverage. Let me say, first of all. That's where you get the leverage without adding a lot more people. Now, we're adding more people because of the professional services and licensing primarily.

But I honestly can't take own poor business in the next six months than what we have. We are adding people as fast we can. It takes time to train the kind of people we have to have in this business. And we will do find this year. We will -- I am pretty sure we're going very well next year.

We're not going to grow about 50% next year, but we are going to grow. So, I don’t -- there is nothing else we can do now except continue to add people and get them up and trained to try to get ahead of the game..

Okay.

Now the bank that instituted the credit card, are they still working on that, or where are they?.

I am not sure what you're referring to Sam..

There was one the bank that was going to have a credit card and they had a right to buy some stock in Intelligent Systems and CoreCard.

Are they still with us or--?.

Yeah, that wasn’t really a credit card, that was a prepaid card, and they are still with us. .

Okay. Are they making the progress we'd like them to make, or is there anything that needs to be done to make that move along quicker to increase..

They're not growing their business very quickly, but there's nothing we can do about it. They're totally independent. We just process more on. .

Okay. The….

We're not that interested in any way. There is noting we can do that. .

Okay.

Now, we wrote down the luminance investment to $50,000, is there any -- do we expect any transaction to happen with that this current year, or is that--?.

We actually have written it off completely this quarter..

Okay. .

That means we don't expect any return from it..

Okay.

And the other investments that would carrying, are they worth more and were not able to write it up or there's any value of these other investments that we're carrying now?.

There's very few that we have remaining. And you can't write any of them on our balance sheet, there will be very few -- I must say it’s a less than $0.25 million on our balance sheet for investment, poor investment. Let me get an answer from Karen.

240, pretty close to say than $0.25 million on our balance sheet and I don't think it would be realistic to expect any great return from them, although we are obviously would be happy with a surprise. We were surprised with one last year. But there's no objective information that will tell you that you could expect any big hit from them. .

Okay. And we -- yes..

But I am not going to write anything off this point. We will hope to as least get our money back..

Okay. And at this point, we've used all the tax losses that we had that we can on the gain in the ChemFree..

Yes, there are some incidental losses out there, but not enough for a matter..

Okay. Now, we spoke of looking for some type of transaction.

But is it fair to say that we are not at the stage where we're hiring an investment banker to explore this, we're just doing this on our own as we develop the business and we're looking for opportunities, and if something happens, but we're not ready to hire somebody to speed up the process?.

That is accurate..

Okay. All right. Leland, you have done a good job and hopefully something will happen where people will want to work with us and grow the company and that makes sense. And we'll -- maybe the stock will get more active. But let's see what happens. Good luck. .

All right. Thank you, Sam. .

[Operator Instructions] And there are no further questions at this time.

Okay. Well, I want to thank you for taking the time to be on the call. As you know we generally hold calls twice a year, so you can expect the next call to be after the end of the fiscal year, unless there are some significant new developments to report before that. So, again, thank you for your time this morning.

And if you have further questions you can always try to call myself or Karen, our CFO. Thanks everyone..

Ladies and gentlemen, this concludes today's conference call and you may now disconnect..