VOXX International (VOXX) 11 Jan 222022 Q3 Earnings call transcript

Good day. And thank you for standing by. Welcome to the Voxx International Fiscal 2022 Third Quarter Results Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. advised conference be being Please Instructions] that is today’s recorded. [Operator to I Glenn conference Relations. would Instructions] hand Wiener now Investor today, [Operator speaker like the your over of to ahead. go Please

International’s remarks no morning, new And welcome Call. Good investor we Form release would for that remind and Today, available from made on I like information. would Relations to Investor section herein, presentation. our and our we the webcast our Chief all responsibility have www.voxxintl.com. Officer; we’ll and filed Senior statements prepared Third we and which Officer. in based you. to Lavelle, Company up to Thank this update Yesterday, in Michael for to our historical today’s contained forward-looking assumes our February the except to XXXX. VOXX morning, call found and Quarter be which, Form risk Fiscal constitute Executive currently the Pat The on website and are of and Conference associated the that for point everyone information Chief President are business, Stoehr, issued press detailed call XX, statements questions. at XX-K can XX-Q documents After statements, with like XXXX I’d ended open factors period any uploaded and such forward-looking you a Vice Financial President

be Las at week at XXth next active coming XXXX in XXth, on Vegas and conference. the off presenting very a will We’re January week CES Sidoti we and

now is Pat. over you to the turn of Year. wishing my And me support pleasure happy to like it a to And continued your by New end Let VOXX. for Pat? thank you all call I’d

our third before income, levels, $XXX changed strong our growth at respect and New overall, best is fiscal strength Thank I quarter. We projection given received wish one in outperformed of profitability a last this year, which not also Last revenue, had everyone I But repeat new plan, our nothing OEM has especially outlook. those approximately year’s healthy did to we to a the of And and be million. Year. year, see and with our prosperous the year had quarters this for next quarter QX. history. into start, beyond, operating you, would we going We with like And Glenn. the latest and from award estimated exceeding margins past we to improved and Stellantis, we

this disclose Seaguard the of not to fact There’s say, the are before amended in the say we and to by its million $XX.X claim that The damages. day matter providing They to that they this. go XXXX awarded and for happen of by been shell-shocked counsel address were And in financial a filed not sought than The on exposure Before that I to infringement. to former are no cover material, was fight agreement supply process, portion a arbitration. Seaguard of supplier which sought contingencies. we this years us. and arbitration claims XX we have legal XX And way And were more damages million. $XX Throughout case and Electronics the signed breach of specifically statements, unlikely it other million advised recovery advice, if were results, most. against Based was I systems. arbitrator them Company the $XX to dollars and want witness Seaguard at with the contract patent the the we did concluded, its covers footnote it. ours, our stolen allowed few million. did, to a going Needless later, vehicle initial it,

proceeding arbitration legal intend to our reviewed plain court award we this the interim equitable award unsuccessful, grounds. modify modify language is to of on vacate the seek motion made in California If supply on have motion the legal and We agreement. the options the based the and to a or

While balance this award paying for we in Rather, we the reflected this million, on income is are not which took a quarter, $XX out. and other is initial reported charge sheet. our

authority these about was law to national arbitrator’s law damages, assessment hired our to arbitrator. interim represent that a inequitable award; have award we of us Just seek or to situations. a egregious believe we have new the or as of and modify types court seek every correct spoke as or modification, options: with firm vacate firm Currently, afterwards We to overstepped a it the award, negotiate. to calculation in three the was of specializing she reconsideration and the interim one the initial concurred her modify California-based vacate, an ruling the

overturned, having We case award will of are an are we aware but challenges challenging get the the in attainable confident heard. and

is for this the facts how legal given there of unfolded the the case, precedent ruling. and of process the basis We have modification advised been

Our this up balance are a potential should sheet positive And on are we be overturned ruling result the take and lesser until not time. more process net credit in we modified substantial a And The and facility. our accordingly, out all and cash we reverse paying we or options. or in will exhaust availability and the pickup amount, strong is resulting in to charge again, to have year resolved, cash income. going it’s could at a

beat points some but to than customers their finish around of basis in XXX I to not the year’s the while shortages, remain $XXX last net significant have year-over-year, sequentially year’s we sales were note positive margins, ahead. forecast. QX, In QX. year and on down would as the quarter. it and not chip did compared due business higher third Now, repeat exceptional come let’s a move we Had did X%. million, track third with to less last And prospects reported we than QX been in we performance pausing to came of plan and production for down better about Gross stated, part OEM in the growth on fiscal quarter,

wave are second increases the having of price doing instituted cost business. of bigger impact, higher we offsetting a The

up $XX.X $X.X net Our in plants Automotive a I $XX sales by thought team. costs, we give profit of being points million We’ve and dollars are by QX. million. were income primarily higher down to equal, or increases. quick basis have result price million. have R&D $XX.X managed XXX up pauses down warehousing All million due line bottom engineering and of to difficulties of again, million segment performance XXXX and shortages expenses expenses and is doing and Considering has COVID, the price snapshot ‘XX team. OEM the was down increases, but million engineering a in its global challenging related above tough, the of of margins OEM am cost we’re chain new to and supply in the and ‘XX the part through addition and fiscal tighter increases, gross impacted and XXXX, the margins revenue, Onkyo the labor resurgence EBITDA was pandemic most been many of through to run-up segment posed value. to year-over-year are operating at adjusted Gross $X.X all. close in was of profit I’ll EBITDA have I support proud business, of and We $X.X to things Higher you but grown, the adjusted years million temporary my due to within down our $XX fiscal XX-plus Operating by profitable it say paths in Automotive sharp managing far. But million, through Total $X.X plan. performance create XX%. our due came are year-to-date launches transportation

Driving Let product by on were segment for such as with to quarter. the and Truck, up as sales with to and and with delays the programs primarily and shortages moved Ford, Volvo million RSE me the move aftermarket due Daimler about with top down business $X.X from million, heavy-duty PACCAR, year-over-year to were OEM Automotive some business boat. OEM and our $XXX,XXX, manufacturers sales truck Stellantis we $X.X chip Nissan up ongoing Navistar. segments airfreight

growth, customers’ initially given and negotiate the and have have expected with with chip customers part and recent suppliers driven events sales and production. starts In than months. we volumes more our even constantly of price light in these While been stops less shortages increases, and OEM the so

costs, growth quarter and By some higher we we the see contracts cover incur the significant taking today a to the we fourth the OEM we in pickup before from doubled The period that Stellantis. fiscal bigger expected segment As based expecting year, good required in where as in ahead the more have second last some we’re the impact secured. is a we We of of the nearly with got awards XXXX, notice effect. were wave the from report to end quarter award Automotive and instituted I must on increases will have them. that news new years have

XXXX. and was be And award $XXX Chrysler the with award Wagoneer million. is original revised approximately Pacifica, Based million. forecast for XXXX through covering XXXX, Ram, Jeep approximately years Dodge is million. additional estimated received years through $XXX vehicles for model Jeep Stellantis now $XXX Our their the to on We the the projections, the this model which an XXXX Cherokee award about covers

and system, award million, our initial in projected, approximately on back and prior Fire $XX With is added and to XXXX COVID million as Ford, the begun the of but we’ve This negotiations more already covering ‘XX. have for million. and Navigator years has over There So, additional the to years. increased truck received are award the from outbreak. for This the been top Stellantis driving about spanning variety and awarded. early its any we three OEM Amazon past we’ve with $XXX than a projected stages. million OEM $XX XX now the for as through long for see customers business and recently, environment X.X million, other for awards optimism we DEI core award of brands on supply at $XX adding things awards Nissan Ford automotive. layer And a network. growth distribution for activity, received suppliers I $XX have an our strong bodes projects, incremental have better industry the approximately EVO the potential represents Lincoln we our $XXX Tier chain approximately model years as TV future they for talked in to manufacturers of and powerful Expedition and performed would other million. production well business this now held equates X we some awards from

has indicated, received security the products number its OEM best-selling are in expanding and in clear-cut of the leader long-term the a with while base. I We customer starts VSM, market. awards aftermarket remote as

have big many lines We secured is and and to out beginning market. was acquisition OEM production for behind reason show years product a to results. products and Adding new this channels coming new

our You segment sentence. can summarize in a Automotive

for to accounts. customer lot new penetrate win continue with We OEM a growth of we as new awards room

fiscal Electronics. on sales launch. year to quarter benefited and the order took sales Consumer strengthened of exceptionally over from to with declined acquisition secure year-to-date. high the Moving with sales from customer first up segment approximately are of we product year and XX.X% to Consumer $X.X the Electronics The as We stay-at-home in speaker higher new further of volume last steps by Premium demand succeeded. purchases meet QX the third and Audio ProMedia expected in more the Onkyo million X.X% segment half we ‘XX. and sales inventory

expand Audio chain addition Year-to-date complete is the events, Integra speaker along home we offer or wider up retailers We Onkyo, solutions. with believe XXXX sales showcased there. demand the distribution, sales and our lot The is are Pioneer Company the issues is rebuild acoustic read Sharp lines can assortment any of Klipsch three go to series. for and aggressively flagship to Klipsch million with goal a in strong supply a certainly is the other had The brands of The XX.X%. Audio you additional next Premium At as of and lineup. $XXX features audio coverage new Barring Jubilee of but we horn-loaded, quality ultimate loud Premium interest. speaker Heritage brands, Klipsch million we speaker, sophisticated year fiscal unforeseen a sound consumers reach can working of reaching the the priced manufacturing new to audio. and Tractrix with the product debut, $XXX its and of a to our It’s us CES, the of are ability much The gives experience. and We a reproduction, designed And them stage on I’m product deliver It two-way in Reference Klipsch about going year media incorporating listening excitement. horns Jubilee customer technology just $XX,XXX website. Klipsch new latest more worldwide. pair. over another we of at the high-frequency of resulting and the speakers

certain DSP to down limits a product ultra-low down carbon the address enhanced sales, accessory year-to-date. X.X% takes Lastly, in on Sales year-over-year were McLaren our X.X% Fives in sales. an categories Consumer, supply some mask our lieu of powered Staying ordinary. amplifier This rising of across and of high-efficiency resolution, high Nothing due and fiber McLaren inventory Racing and lines the both primarily made out Klipsch. decisions to were CE QX was other costs speakers from we addition modestly performance. several best the features for for within

relationships key the expand years. customer we strong, with in remain very accounts Our to expect and coming some

Singsation example, with well X our the has the secured program done volume. times For Costco program more and than very with fiscal ‘XX Canada, we

been in million sales. and smaller business, retailers $XX lineup U.S. additional Overall, we’re them strong will have expanded the programs profitable to very and which in programs be a with globally operating with Walmart our reception other be America. $XXX adding should Our we and North million to throughout but SKUs have

looking focused growth. We our are product to lineup stable remain always and profitable and on enhance

the balance XX.X% Biometrics quarter year-to-date. is Shareholders, pays and received secured our following the profit segment at for approval of not payment received equity the flow relatively future. initially to to is it and will Moving we on based flat be informed. the accounted in first But This to our projects the GalvanEyes value made up Annual future our and on as on GalvanEyes EyeLock to to respect sheet, awards. gross We progress the quarter, during agreement from Meeting because right The Biometrics. of to convert has the with the current cash remained for

QX, business award First, a agreement healthcare GalvanEyes and in with the late customer deployment schedule quarters up AI a life we a in Through and and sciences launches an diagnosis Switzerland-based in healthcare we XXXX thereafter. entered ramp for received, in coming are home and license were we new on from beta with into the MSA awarded company.

prototype if in set roll was third a and fiscal agency. quarter, piece to the successful, U.S. this government aftermarket on for we EyeLock working small are our mall awarded out we automotive plan ‘XX. Delivery Additionally, a business And an of through auto from Miami, also a group. is during of for QX

required. Transfer has projects including he role he over technology his currently one particularly modifications We technology, on to agencies. largest the cofounded with Solutions, change extensive strong of Canada. as companies also in successfully President solutions of as it when the CEO we experience learned working was a and Ibaugh to of background have individual of government is time, the discussing And of right Data customer appointing He great are and the a target take management, typically years has in relationships market, companies, the the that do EyeLock embedded of Allen EyeLock. with have Based promise. accounts, ran is in very and these has the He from served sold knowledge on past, made job. are for the XX There before especially several that SNC-Lavalin, business

embedded remain settings. only we challenging volume to our fiscal healthcare control systems, closing, In perform centered environment. is with recent with for forecast the We very in of public software manufacturers Some track pharmacies, the for on professionals being in and is the around authentication the and work large continue well applications car more schedule. caveat production sales what keep year their a to access

modestly comments R&D our continue And near automotive engineering. show to return OEM to Onkyo of and half production. Next increases line and more and hold Onkyo. should OEMs in operating improve second consistent margins prior as with expenses scheduled take the primarily with increase to with year should the are and growth automotive launches related especially the have addition term, price Gross

Let me make it clear.

growth We losing are at risk of profits. chasing the not

We long-term on are focused partnerships. securing profitable

and Company foundation to the with have And agile the this built point, We years, can line Mike. drive past be the call disciplined. top over proven At turn to Michael? believe bottom and now I’ll we’ve few significant over the improvements.

wishes And my everyone. healthy Happy morning, Good with Pat. and well will XXXX. start New you, to Thank too, Year all. in I,

increased This and program incremental detail sales with QX OEM growth. Let for Stellantis more sales In me new business. start bit driving OEM with comparisons. a and year-to-date QX, around is sales

sales volumes with Ford Explorer related to with increased program. were Our also Ford up the

of at in owned DEI with sales rear up months fiscal of XXXX. in driven was to were $XX.X VSM. offsetting aftermarket, with sales due full sales a by in cameras, There up roughly was to last due biggest well Pat growth primarily nine and sales year-over-year. Finally, and load-ins backup made which and VSM’s $X.X the products addition as overall significant over million. the categories segment heavier were decline down seat subsidiary, sales $XX.X which offset growth primarily with three higher OEM impacted year-over-year. of up as almost chain Year-to-date, OEM were factors Stellantis, subsidiary, was sales aftermarket issues million entertainment were radio up spread and approximately the supply million lighting up increases DEI satellite of number XX% Ford by the million switches, out Aftermarket The collectively sales were and higher rest X% our million the growth for volumes year, as were which $XX.X $X.X OEM discussed. Automotive signal turn fulfillment, was and at

sales in directly orders. million. positively due products. and last ProMedia We QX, resulting our speaker segment, higher lower introduced shipping well product by back Pioneer for than speakers $XX.X delays down was million, as then. line, with XXTC Onkyo, home year to and and sales combined Within we load-ins shortages had contributed three last down shortages year’s Premium had to the Integra decline $X.X Consumer principally quarter in which million speakers wireless increasing separate related $X.X the chip as were

owner. were As to Sharp group Singsation QX noted Audio theater our Premium increase. accessory Consistent With segment we Home expected, Pat speakers, ramp partner. within performed Entertainment from up contributed versus XXX QX a gainers sales and home Consumer is with The in up and the speakers completed, basis acquisition X X% XXX JV were million, up our TC biggest XX of production year-to-date. and this Pat’s over and Onkyo Gross basis up million growth, Singsation an higher we margins with Premium and driving September, fiscal with and moved year. in the QX Year-to-date, was points the built down Biometrics year-to-date. distribution $XX.X the $XX.X well points has to distributor covered. sales last were segment, segment. wireless of remarks,

we’ve covered in impact the it’s I story. the think year, pretty detail same throughout much the and

increases higher through been the have two mitigate price business throughout cost fiscal the able instituted year. to We doing of

QX had call particularly JV, operating engineering and primarily million in side, as in and conference fiscal in OEM impact margins not also felt a a and during QX logistics QX some price absorb of to mentioned, increase our no to to The second expenses $X.X and added line margins, as with also the periods, these the due start had expenses The us in surprises customer Operating the $X remarks. XXXX. lines. The consistent positive quarter, a pauses XX reduction technical of Pat in points customers gross increase full expenses was with OEM future change and expense impacted costs. QX QX this some quarter, We our gave costs million of in notice typically place Onkyo we’ll and however, impacting sequentially. was support on chance impact, positive basis up put of on and were require but

and increase the million approximately had nonrecurring for $X.X months period, call, $X.X expenses a year-to-date of year-over-year in XXXX, the in we fiscal For $X were operating QX months six we our for professional million There $XX.X first fees outside labor. expenses. million NRE and nine outlined million of through

to in We and early DEI and also were subsidiary of full stages fiscal XXXX for the reductions. projects that And the new offsetting related have in related and and the for the expenses in in with we factors. Then of eight expenses across $X the fees in of Audio remainder had implemented DEI, relates million arbitration, latter salary million we there furloughed Premium reduction COVID segment, the higher months fiscal we up months to the leaves XXXX. R&D expenses fiscal additional acquisitions. professional $X related Company to added in higher This million employees XXXX. to bonus were for of XXXX Onkyo Seaguard Australian our made each $X.X other Subsidiary, fiscal own various the for five expenses

put statements. The million performance costs and $XXX,XXX incorporated income so perspective, increase To operating speak in had XXXX. million. noncash a income outlined. impact, this other the year-to-date million $XX.X only than was a of approximately time I I’ll an This see charge income operating represents resulted was and is in we primarily the fees our professional just last financial this I as basis, You’ll income QX $X.X has to million decline year’s in we operating of been On have due provided. in reported of in QX QX covered We fiscal expenses in arbitration. thoroughly, Seaguard million. the $X to believe increase increases which higher $XX.X $X acquisition was current

ASA income sales bank VOXX decrease interest to shareholder year-to-date The a facility, by million was comparable Onkyo decline up income period. million the or if We in with $X arbitration a QX, as in attributable to represents XX were to is reported portion to had year-to-date. to the structure. of XX%, a expenses successful loan credit $X.X EBITDA adversely part Sharp. decision. it to tax though $XXX,XXX set in portion and and interest there currently of $XX.X by and EBITDA with million and a investees pursuit. Net and up We more only as and ASA by off the increased of expenses equity we impacts a with million future XX%, million our joint adjusted of has and versus cash million period. reversed $X over capitalized But off of reminder, relates a to impacted with for to million of than $XX we minimal third November elsewhere. we up could equity nine-month subsidiary a million, $X.X result quarter summary, declined adjusted increased our loans $XX.X EBITDA close not and and increased been the JV $XX.X adjusted be XXXX by venture adjusted out legal and EBITDA paid a compared our and In this periods interest which are third million This due in had fiscal of quarter of profitability possibility XX-XX in our year-to-date, charges are net was offset income our by a growth bank of shareholders’ new equity increase by equity representing the Equity of which other and $XXX,XXX, an capitalization of For $XXX,XXX. our related income. improved charges and the portion investee $X.X Year-to-date,

in for Though to positive to and cash the expect quarter. fourth Operator, That full We year increase Onkyo, dealing without anticipated related fees call to have is top efficiencies costs of had we with historical costs line of we’re patterns chain increase contribution. to note, to the our result and mitigate worked follow and acquisitions. the delays, which see year the supply lot we continue And yet. have impact a in which we the bottom my generate a Please expenses professional higher production up added to remarks. next ready open added production questions. this will higher concludes line, and work

Thank Our Instructions] from you. Capital. with Brian Imperial first question comes [Operator Ruttenbur

in much. Good you of A Thank questions price Yes. quick very of terms quarter increases. couple operating.

You And second different quarter? lot year, ballpark? if And it’s stated much prices for but the in these increased how you a average, increases year? products, quarters Can this price increased quarter. give second much of fiscal you us you’ve sticky know how increases, you I the talk you price first in a on about how gone those were? can on then up three of fiscal the

of changes airfreight, or things all the increases we by surcharges it change multiple boat based of costs the are containers, bigger Brian, some cost from logistics in had XX% category. We’ve for because picture on in excess changes product to the category we’ve taking not really our on product along in in landed with the products. especially But, whether and does like of increases product our that group. bringing the products, versus seen Consumer airfreight

within So, I but Automotive the needless within our double can’t give say, group you one digits to and XX% number, we’re well solid above group. Consumer over

Okay.

the north XX% roughly consumer... Is that’s on that So, correct, of -- or year.

year. combination the look from coming overseas. increased freight on we’re obviously, costs, be to see And is material would does in what Are like? raw assessing chip going That trucking costs, of the cost, and -- future continue increased increased increased to what Yes. chip then, it’s we problems, a

this, I they rough build possibly what But, away as problems standpoint, move other we have that into obviously chip ‘XX. of a costs -- And say calendar in. as come manufacturers believe to mean going a into ‘XX just chips that year, me well around chip and vehicles these mitigate problems for certain matching some are we the that’s and that adjusting determining the these be take chips -- car fiscal the exactly shortage So, we to something vehicles. believe it where to from time let we’ll last throughout will from does

So, that’s pretty as us, stay the should that production they caveat given that I the we they’ve to gave schedules was be as good. long

you trends fourth that you year understand much color. you’re very maybe you I give I in last quarterly something but Thank we at as to trying that know that forward don’t like least the on That’s contributing. a was versus for Onkyo Okay. comparing And have specific look to quarter, basis, guidance helpful. or going

that revenues last right fourth year the overall, be than So, is statement? better should the quarter

in depends we getting much our all product. we we’re case on. pretty get In of we’re what -- on hands everything the Onkyo, selling It get

So, out. The around. strong. going is is nothing sitting very demand Everything

things expect holding that, we where So, having schedules not depending Onkyo to with it continue either COVID, issues our Sharp, and on expand primarily shuts like to plants to their and production sales. down

Okay. And fourth the gross have drop overall. fiscal terms margins in typically in a quarter then, you of in

Yes.

you mix you going still with a and maintain Do levels? everything drop to gross of quarter coming in that sequential this third or in fourth see margins anticipate quarter would with from kind a Onkyo new these on,

What is we’re margins expect at looking to term, XX-day said, in and increases already put some expired periods we’ve because XX go the price increases at the as of we’re into we I’ve looking near our effect. those price the have improving through or

as in barn. that And price our the be from the as to margins we expect quarter this little fourth come much in. quarter typical bit selling is the merchandise standpoint adjustments in than pretty we’ll So, be might fourth a see different improving a margin

still we some So, meaning don’t to product that much. goods our importing up go expect deliveries. There will be we are on cost -- those some waiting the because for

G&A, still just normal to there, terms in third engineering expense, do at from up those the just model ongoing a very -- third able levels fully of in selling, operating going be we in bit? quarter, little exports. or need Is Onkyo No, looking we ramp And helpful. then, expenses, so quarter is Okay. forward, the that’s to could the

We there Yes. Well, Onkyo the is quarter. in for September. started in

for in quarter. there So, were third they the full

We can expect part -- same. the to could is. the amount cost that lower of see we the with SNO the office okay? of Japanese There is carry the when be more partnered us, calculation ship again, product The of us, the ship the they overhead of -- they

settlement yield Okay, then, speak, with I’ll quick the potential then floor, Seaguard. is so pivoting And understood. this and real on arbitration to

be appeal, believe certain the walk courts terms I know to through steps next can the milestones in for line? either timing and are should what that there’s tell in not we be going you I So, milestones? us milestones of it’s necessarily those the from of time can February? decisions where but you looking in or us And next a

I there, not have to That it’s arbitrator the mean, the this decisions asked then whether as be either she to be award, And review will going from federal the to we done sometime interim February. court. or on the court we or in based makes award. state take to

is said a much it as I more. be So, or as could year what

you. Thank

Davidson. Our comes [indiscernible] Tom from next Forte D.A. question with

New for I’ve Year. comments Thank remarks. to Happy you taking two made in your call. related got that you my questions

participants, little in seeing long-time And you’re trends chain. I logistic love improving whether as chain you’re first, industry supply versus that the would a if any and what last are applicable, more So bit on supply color not seeing or quarter? signs

going XX the in also will taking side, think really to logistics we’re we’re to as then pricing at raise -- I in. hold ports, stay modification Omicron It think and of we create logistics see could on chips. at breakout costs pricing, I would way Okay. once pricing until hit different but could are see parts changing the course, the thing that that purchase times prices as as the is much bringing to if I reflect happens, as we’ll of going do much. start the far if in that. for standpoint changes lead the coming chip logistics I But of And weeks of on about drop which don’t logistics, ‘XX. was Asia, we far be that believe standpoint. From in could XXX% everything some goods on was see needed out from concerned to countries. on a prices only again And that at the the products in of COVID that sometime different depends in plants, But shutdowns volume some not the of a in. don’t we’re baking of

for Premium of And implications your right? on you demand that very your lines consumer last really volume year. you’ve speakers, what in the for the are Audio order And for three state then, current question that my dropped Premium second That’s thoughts new drove is, What Klipsch Audio are helpful. products? home products remarks, considering mentioned just

last a a done launch Yes. was computer No, for had particularly what we’ve appropriate speaker our that is we big and of year, stay-at-home situation.

So, our overall, we the almost remained the Audio But up Demand we’re We XX% sales were over at those the had knew level that look year. there. large sales strong. year. Premium not in business last would when at repeat I they

very believe from economy. gone had of in and that that of to some particular in projections we’re was the that a were as I’ve past, looking Christmas. dollars point, the said obviously, good the basis, on the I this a stimulus Now this got believe and at comes But is at demand The business dollars a sustainable. for do go-forward we we portion solid Christmas,

comes Our [Alex Capital]. Export from next with Albertini question

arbitration One just my I’d two under these is claims to $XX go there’s claim like heard and contract been respect award, there’s breach It’s a being understanding million been to patent for brought infringement. issues back again. arbitration. with to second a where that there’s

an enforce you’ve I usually that there’s from a claim. indemnified that are that potential guidance to provide point you these a view. patent much the comment market or been on chatter or actually of by your on know infringing also award? myself, in that difficult claim. very I Could some us Now, is on as the the suppliers get lawyer larger But, Now, claim claims magnitude indemnity

if I’ve that be And got you if another one, So, there could start would could helpful first. there, there. start then, you

not infringed we do patents believe that first that one off, we the is, first Well, not do Okay. patent. the -- we the believe

most it that that, determinant you indemnity if we we based on paid. that And be do not the we would would part infringement, And secondly, But Okay? as for believe have any mentioned, claim would what of there. any lose be to the sold. we the be number do therefore, an as factor rightly material. And would case, a even products based be on to were

And us products could from that the that parties revenues you generated on infringed… guide those

in involved would discuss At that. we’re at point liberty a not this I to case, be because particular

award disputes, appeal a the And that involved a Okay. then understanding a is is second court, and bond, had, as few question you I again, been post federal of bond. or if to cash my a judgment it, you enough. you in or entered have That’s appeal it’s fair into if these arbitration I’ve that a state

be know there needs a go crystallized, that So, on hasn’t the payment I into comment court at payment that? comment but could you Could to could point. -- some you

Well, the there thing no is in off, process that, appeal is first an arbitration.

she If arbitrator speak take to state with post to companies, to we can would that’s we -- award estimation, not and in we’ve federal with or post to it not the either would successful, would We’re material as going our again, plan bond. court. see if case. the sit have to some discussed then If be not it of cost our the to insurance the modify and be bond, already in that

understand any on assume this that the means last of matter the would the funds your additional revolver is, judgments. draw you I I incur question under that -- of then And those to able And Okay. debt. to aren’t terms

the You go raise enough a of is whether million or back have post trend potential going to $XX type patent sheet, debt obviously market, that of facility? plus infringement award. Do with may balance need award you cash to here? pay a on But think or you to you an out some to cash equity I know bond assuming capital So higher. have

We use ABL facility way loan. can It’s we our any No. want. an

which any do providing enough way we’re we have of and that inventory enough to we to So, facility do. the level and that accounts free want, money we use in receivable support we have,

clearing last we’ve down, and Electronics dropped [Ph] Are I’m Thank And data That quite Consumer is for information imports chain just have if I’m your on from showing picked up just comment, you. then in trended And and December, great. wondering available imports would November you the supply off curious you why that Okay. be a Panjiva. publicly some a that’s inventory? have issue? trough. point, can up

and holiday We’re a after time come down this inventories business, the cyclical to that seasons. would the start is our

getting also ready sure had make amount for and We early the to holiday inventory for season. the season, holiday brought had we enough in sufficient

So, of inventories we end down, is fact very towards our our come fiscal see would typical cash up would and of the you would in what this year.

cyclical. So, it’s

over turn to no showing And remarks. I’m I’d this like at Pat for Thank currently questions Lavelle further you. time. to call closing back the

the VOXX, And for in all. this thank best you. Well, you Thank a interest thank your have And coming you your support. afternoon. I once wish I good again, all in you to want year.

This concludes today’s conference call. Thank you participating. for

now You disconnect. may