Cemtrex (CETX) 12 Feb 242024 Q1 Earnings call transcript

Greetings, and welcome to the Cemtrex First Quarter 2024 Financial Results Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.

Before we begin the formal presentation, to remind everyone that statements made on the call and webcast may include predictions, estimates or other information that might be considered forward-looking.

While these forward-looking statements represent our current judgment on what the future holds and are subject to risks and uncertainties that could cause actual results to differ materially.

You are cautioned not to place undue reliance on these forward-looking statements, which reflect our opinions only as of the date of this presentation. Please keep in mind that we are not obligating ourselves to revise or publicly release the statements of any revision to these forward-looking statements in light of new information or future events. will business present predictions. that we relating important discussion, our to may today's attempt some to factors Throughout affect our

should company's detailing complete available Relations most XX-Q our under and the and also is XX-K Factors. A particularly website, was You Form press section issued Risk and afternoon release other recent risks, Investor for results of of in discussion Form more cemtrex.com. the heading our these these factors a review this

and Officer; operations Executive Wyckoff, Chief quarter Govil, call Saagar today Cemtrex's Executive unaudited time, the host Officer, over Financial of ended this Chief present the Officer, for Paul will will XXXX. At Your Chief first turn Saagar I to December Govil. results XX, the

welcome conference first XXXX Thank you, operator, and call. good to to financial quarter you afternoon, results pleased everyone. today's I'm

quarter first operating and improvement. The highlighted was fiscal XXXX company's of by realignment the performance year

XX%. For increase the revenue million, $XX.X first Cemtrex quarter, of of an had

by For the our held gross margin first XX%, quarter, operational improvements. supported at

to continue as our gross expect forward enhancements business. going We make our further we over in time increases in margin

fiscal to reduce realized to we in $X first $X.X Security to reduction an loss start a additional to that steps operating in including improved quarter second our of Operating million expenditures forward. loss the quarter, for ago. should $X During our a our took overhead in going quarter operating segment million be the million compared year

management system ability award-winning revenues technologies Valerus base protection, facilities order software New inventory with by to chosen recent maintain asset during correction order. led in current district our cameras our meet from orders We first on $X.X segment develop and a technology the in within driven areas. Increasing to current of solutions solutions, instability million challenges with in position. Revenues to its require extra Roughneck to repeat the an border capture customers, previous to rise video phase with [indiscernible]. also Vicon being market, accelerating security a to that security the expanding customer cash million. security by solution Security liquidity Vicon, a XX% school threat its believe second the there's advanced that order from quarter increase people of in customer's unique healthy and an and geopolitical Jersey, first the and quarter draw schools $X.X the reflected modernization growth infrastructure border and in Vicon's to of new room improving border the monitor are ranging locations of is protect were

infrastructure, to new customers modernize seek stand security current products. access to our and platform Vicon recurring revenue model. and us with their advanced cloud in launched new security one As face-based by out create authentication. that This business Anavio, AI a easy-to-use cloud integrates video by and business called Vicon its time Vicon more intercom platform evolving continues allows to value over in powered system into technologies a

customers, to we're new to our the cutting-edge over and Additionally, road deliver the AI the core months in our with excited benefits to of solutions layer come. and map most security in capabilities years Anavio, for at

of increased continued highlighted growth $X.X technologies our orders $X.X increased of opportunity our demand CFO, new With a Industrial company. AIS software geothermal Paul supported percentage new to core expect growth segment, Northeastern system a industries our we continued was to a government increase and in our to the the along Mechanical. industrial launch district margin a Valerus, see and XXXX. Revenue for drive improvements update for Anavio and Paul? highly announcement of financials. This for geographies. I'll of growth synergistic in and and additional of platform, due with services verticals, key to million for additional of further the close grow to new variety a fabrication Services component was an projects, motion $X.X to to discuss in mainly by acquisition to Heisey The school for control AIS, build XX% recent $X.X gross a order million. call continues by for service including million in X order a Wyckoff, for over profitable with now wins revenue million turn the our

and was demand million gross segment of Total profit mainly million $X due for the X XXXX. XXXX an $X.X to was due ended Revenue segment XX, segment first million the or increase to expenses the $X.X compared quarter. revenues revenues of revenues, first of segment for compared for the to to of quarter quarter in of improvement to an XX%. of of first was loss technology compared of Industrial in the increase for $X.X revenues due at XXXX. business. Net the December The Saagar increased year's for profit revenue Heisey cash of our the Operating was XX, for to the Services million. first at year in XX, $XX to The loss you, December $X.X the loss an products by Vicon were as XXXX of XXXX, operating million the increased for compared million and September was quarter million XX% Cash additional increase gross million million XX% for as $X.X $X.X as first quarter brand. Saagar. increase to segments XXXX. of in respectively, XXXX XXXX to of XX, and XX, will quarter of $X of of to $X.X million due by prior review for December $X.X million security to of a Thank at fiscal call compared increased the profit totaled XXXX demand first cash to primarily now first the September services, XX% million the XXXX, $XX.X The and to net XX% equivalents improvement well an Security $X XXXX, an million, loss at $X The quarter the XXXX quarter outlook. million. the months million Inventories our back due restricted from XXXX, as million $X.X period a for both Security $X.X the as quarter for million, as under quarter for revenues decreased of $X.X was turn first for for growing or XXXX. I operating to acquisition. Gross XXXX

Paul. you, Thank

line maintaining is tight our are next-generation operates additional will we cost markets operating while Anavio Along gains. AIS and larger acquisitions. the market delivering camera software. ability share highly business operating measures by driving security help version, businesses. technology, of and in traditionally expanding opportunities with Vicon's its disrupt ahead, control on recent revenue quo focused Looking how top industry has X into status its with [indiscernible] the the profits recurring Vicon by growth new drive BMS customer evolution model state-of-the-art rapidly next-generation into its supported to

our and explore drive within We further also growth expansion to additional opportunities that segments. acquisition business could continue

are on growth committed and year a focused are driving full delivering control with results, basis. operating expense XXXX fiscal tight combined we to operating attractive year on income to ahead, achieving positive Looking

I to you deliver We long-term strong your are like all shareholders we we And on questions. forward. Thank now attending. value that as going for for would Operator? confident stay path, can answer our this

[Operator Instructions] Holub Office. first is Family Larry question with Our from Holub

fiscal performance? the congratulations I just strong quarter? Industrial second Security the to line what trends top drove the question say want segments, QX My see performance. same you on And and the the for in is continuing do

So I both of our think one, with a businesses, maybe each at I'll time. one within start

level micro both level. Security like in I'd a look So macro the and at segment, our things to at

reflection macro we continue both to and times. in of security and small, as tailwinds that's the priority, continue we just at to So the level, that environment the strong a see live and make big organizations, a

So greatest security priority. invest security made see upgrade remain big security and a continues infrastructure the to to expand latest to continue technologies. we're and in solutions, investments to And continuing big,

I products, background. At old stay competitive that's is award-winning So and the cameras. continuing and organization continuing with Valerus win the to think of out We're level, customers. Vicon in upgrade things. continue I is to our happening hearts the great really to Roughneck put a market doing the minds our new think what's lot products in of

we're expansion Anavio, lot And starting with the Anavio, activities core that sales and that been of we've seeing for continuing we really, to opportunities so then a ramp we're this up quarter. to that started day. And so product better every marketing just really make

and that to already starting interest we're we're So from up. getting customers, ramp

company. of layering of positive so are really each And to build other momentum these top all of the kind on for things

forward going I So think on the we're XX% us continue average order the allows that grow will XX% to confidence excited on to that. of couple next that Vicon And of years. to over have about

about good really feeling that. we're So

side continue us, Industrial that that our for again, of us. positive that the weakness we level which higher. at the seeing from demand gives Industrial confidence outlook regard, We're trend continues Services On not to for the macro remains to business, any see

As to for contribute growing the in U.S. leader is AIS in the and infrastructure manufacturing to and United all here you back a industrial demand know, reshoring services in. the which capabilities, investment States,

gone The see really of line really then all top AIS line acquisition And that drive the growth income the in with the as is picture. And continuing that's operating to integration sort so organizationally, again, cylinders. And operating the larger what's the has as we're on well. happening at of business. well at

go as then that continue could we're we're and for will additional segment results, that, and look overall, further well. quite drive hopeful going the pleased to that we're that And we acquisitions bolt-on happen So forward. to continue in growth continue to with to as optimistic

on excited it's the about. both So be business, I of to a think lot sides there's

should consecutive -- decline, I titered QX we and sequential My operating income slight of about reporting in we and last think operating second how then quarter given the third income last Great. the period. question, the think for because

Yes.

were were so a would, some them onetime forth. around expenses quarter, out point of where So this hoping we Operating there things couple land didn't expenses there. it in some past we income encountered and payroll that of to

I prior quarter little in an bit the [ general, from quarters higher a perspective. So than think OpEx ] the X was

then of or did on to And as OpEx $X billion have quarters take. as to that. or about because of and I that give those by subsequent contributed that, expect So don't change timing reduce high top certainly we of of overhead so, expenses. the some an

and should make we profits our continue manageable as belts. bit really and also a little bit little grow those to profitability tuck into that So more continue a to

in about it. terms of that's So we how think

profit So I having remain to fiscal this year. operating overall, committed we an think,

unfortunately is a little business Our bit lumpy.

still we land to will that overall environment, the booked So exactly loss quarter. picture feel orders the invoice. despite about and an first predict when good the it's in always the and on based get But hard macro overall

There closing at Govil are no to I to time. hand for back further questions remarks. this Mr. his now the floor over like would

each Thank I you our today forward operator. you and would like and on to progress our growth. thank of earnings to ongoing for call you, continuing update to look joining

call, out questions your answered. Thank questions free MZ further to assist any Group, would and happy IR than have our to you you after more for If firm, to this please be your time. reach feel who get

This concludes conference. today's

may You your at you participation. this time. lines your for disconnect Thank