ADDvantage Technologies (AEYGQ) 12 Aug 222022 Q3 Earnings call transcript

Good day, and welcome to the ADDvantage Technologies Fiscal 2022 Third Quarter Financial Results Conference Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Mr. Brett Maas, Hayden IR. Please go ahead sir.

operator. you, Thank

today well joined Officer. Hart, and President We Michael by Rutledge, as as Financial the CEO; are Joe company's Chief

from results on release subsidiaries currently to Before and the certain a change. its Reform contain this ADDvantage in information notes to future consolidated other future which strategic are ADDvantage relationships and I'd the variety Securities statements call report of this this system conjunction results financial XX-K we should Participants today limited the issued harbor the with and include Commission. most call provisions or recent are file actual on company's ADDvantage is events call, among remind statements such may Technologies presented on well available number Private safe and most information Financial in of ability maintain report XXXX. in begin on and that Exchange included Technologies' be conference Securities contained agreements events, the and statements These guidance the with you factors uncertainties. is only on financial are anticipated The statements original with multiple materially predictions those Litigation regarding on involve press of considered differ recent ADDvantage future subject like earlier a to and Form to Technologies risks on based Technologies. due regarding Technologies' conference of as forward-looking in included These such ADDvantage subject things certain Form performance XX-K. to may manufacturers statements cautioned of as and equipment statements, of forward-looking Act as which call that operators as future today's these forward-looking

today's certain change, update company points the only provide it will information and at Although ADDvantage influencing only guidance will Such speaks of year. may such information any the date as guidance as Technologies call. of during factors the not necessarily the

call, as non-GAAP net in present financial these we at non-GAAP release used located During ratios at financial today, with may are certain measures issued which this table addvantagetechnologies.com. also the in earlier income and certain are that our our and measures website press such

the You'll non-GAAP find measures of a believe closest should these about now the of of considered financial in benefit we not turn ahead. investors of I'd like With and Chief to GAAP Hart, measures go financial and the reconciliation Executive are the measures financial out Joe to addition the with to please relevant. Technologies. why instead Joe, be call financials that These included for way, and ADDvantage non-GAAP over Officer GAAP measures. of are President discussion

we call and for into wireless was or to have revenue per earnings XXXX XXXX, Brett XX% in continued was quarter quarter months of of our more more today. about record with wireless the achieved surpassed nine us and work XG with XX of per $X previous our another share revenue you, row we in over for tower $X.XX than Perhaps positive revenue the thank last with $X profitability in all growth on fiscal million improved us context share. division. importantly, to for joining Thank To in by fourth put the GAAP and of and quarter. fiscal XX% net This a increase quarter year, through over a compared income financial everyone performance months XX%. you This the million $XXX,XXX

million router our business and reflecting $XX of result The offerings. margins. business of up the nearly more than the first year-over-year. well are for two revenue growth double-digit gross and optical switch, from last in benefited generated increasing XX% growth quarters and also continued our with transport, total year quarter performing Both continued strong is for We network in telco we enterprise our revenue demand sides company

Our for quarter. quarter almost revenues all revenue. reported XXXX. almost revenue as Communications margin Telco they year's did the a last record as Triton revenues much historical for and Nave fiscal for segment of both for half Datacom's QX of were year this delivered total

some But continued initiatives and reduction improvement margins lower the the in supply fiscal during second and quarter We XXXX. wireless expenses in profitability fiscal third the expect the has GAAP cost into we products chain since trend first drove focus shift issues continue to profitability business helped change in third time leadership and wireless to to success the been quarter continue. third revenue has lead to driven in encouraging quarter. helped chip The somewhat quarter telco. global unit more this fiscal importantly, Telco our by contributed gross for that introduced the shortage optical significant and in quarter fiscal into of that This and XXXX. the GAAP a of

that other of XG grow throughout XXXX. year last it We have fiscal and related annual to expenses quarters. will those on Year-over-year, to savings Wireless increased tower work and to by fiscal million year. wireless in aspects year-to-date we targeted the reduced see an we the basis over XX% annual $X.X already are track revenue this and continue has approximately several rollout compared into expect on to next

Our in carriers; the spread center the service, growth be work continues broad-based all we the customers The including involving of touches both the and United market. across regions players to new four States. long-standing all

will dollars work, waiting carriers The carriers a and XG us where gives confidence the Our the across for opportunity projects, CapEx the complete, four that new the significant near plans for carriers. wireless expansion term. of discussed. Each all tower pipeline public of multiyear in of are the of growth purchase major investing continue are billions widely opportunity those represents as of and orders have awarded in growth meaning are we work been is permitting we

towards enterprise caused chipsets original and fact, catalyst and have switch segment global leaders consecutive was focus the the chain great by the Telco for margin more of had second those row. over pivot and and been the a were $XX router in million fiber and This network the QX the Telco. growth record optical the providers. fifth the all-time a the to businesses, business Triton $XX quarter Nave offerings quarter transport quarterly Our of in heavily an revenue and a new in optical network growth for supply was the our units, issues for And record while in Telco the by primarily segment revenues million

change our a leveling off We our call may our contribution in financial to point level at Our remained be our Telco go investors like appreciate that of to company. There in happy continued all segment out hard success. with continues demand I that and future a would us strategy believe to a quarters, to on positive the their in of unit support. Rutledge, focus Michael, to the ahead. over have management really your at Michael CFO I'll generate now solid to past, and the elevated keeping this review results. please past would to our in of our I years. provide great for giving remarks more turn and we relative and recent my and a business close all product quarter change leadership shout also has somewhat like thank margins some customers these albeit few but nicely for the by segment of a With staff shareholders. that. those to to through positioned detailed work delivering hours long

three year. compared consists $X.X communication the support $X.XX June diluted $XXX,XXX increased quarter and profit $X.X million increase for we $X.X and million based in increased share million The XXXX. expenses increase Telco shares million This of was services, the of cost segment due $XX.X Net increase for XXXX or and ended primarily other on months to increase same revenues. general million on year. the net higher for quarter Consolidated was from you, loss professional share the XX to up which sales the of compared was XXXX. XX.X up expenses $X.X wireless million per $X.X for forgiveness months $X.X income include received sales of categories or same gross to to net personnel, of million million and an our quarter revenues from notice in million increased million XX% the Consolidated June the for Thank loan The in the the Consolidated segment, three last ended with $XX to the wireless increase fiscal or in overhead increased relates per XX% in and quarter million. margins. period million $X.X to income sales quarter to $XXX,XXX same XX, million $X.XX both commission first shares the insurance, $X.X due from to our to quarter, period. sales and of million $XXX,XXX June since increased selling last third excluding Joe. telco X.X administrative the $XX.X diluted for stronger increase due $X.X for reported SG&A or XX, a ended The represents gross for profit loss our PPP quarter a selling, for

September June Cash sheet. to $X.X XX Turning at million operations $X.X $X and in generated of balance were XXXX. XX, million We've to cash our equivalents year-to-date. cash from over as compared million

million. XX, As inventories had the $X.X XXXX net company of of June

concludes will We call now any to sufficiently backstops the business operator to facilitate conditions. to This to remarks. questions. overview financial turn continue our appropriate with are of support segment capitalized the I believe over we near-term the

take go Kurt Carl our first from ahead. with M. Hennig. Instructions] We'll Caramanidis Please question [Operator

quarter. the guys, Hi on congratulations

go things Just are next wondering by is or carrying And like the did looking? quarter cadence the on quarter how the kind steam and month? into of did that things month how build

quarter-over-quarter probably five year. tripling to I Telco revenue steady almost about up drumbeat grew that's row has segment last months. that the compared these in or four quarters would ramp of team quarters. kind three, has say mean wireless last a a XX% been been XX last the building over last, been The and The for I doubling

on wireless COGS growth margin and increasing has over the last And the We've would that focus side margin our So of that. our to say expenses four reducing margin with on steadily points has picked the year up improvement. our improving. and contributed gone I controlling along about

the and a And is driving cost control on expense this. so the just overall what's would team focus clear profitability and to improve gelling say I of very management been

a Okay. Great. or missed late. And again, this two I minute I'm maybe

strong, So your outlook? outlook or is feeling still you how about are pretty the

We fashion. month-by-month truly that nothing path. off see real to never not we can you guidance change But I good business. in of just any not quarter-by-quarter. mean, dramatic fall say and that kind would predict it going a that we're try We're I indicates in it's hard give to or on

on Congrats the quarter. Great. lot. Thanks a

you. Thank

take you. Gaspar Thank question Private Instructions] a George from [ph] Investor. We'll our [Operator next

on quarter. Joe what your you us? versus explain And crew in can of Congratulations a a little Very about expand work, has or or give tower the trying using are are count your operation? wireless activities -- that the Thank you terms explain Can impressive. in-house tower you And you. to getting changes the kind can you Hart there? for you To are still away mostly strictly from on little it they in do install crews? the have? activities changed us and bit further What outline of outside there,

the for the call, those -- goes building might tower we new the We're wireless towers. to be No. upgrading on not towers. focused We're that that we're And segment work. those technology on

we XG wireless a work quarter-over-quarter. months. was focus say would these the in clearly probably fluctuation hundreds work. the matter for of That fact, on one the new our did a a I that's of And to amount sites in lot of that segment. of scope is we of Crew always simpler So a XX as carriers here count last upgraded of

work, previous and say after that a we AT&T Verizon can remain tower people T-Mobile. I So than that bigger the we're fluctuate. crews reconfiguring as work on go That with counts focused more actually requires so crew and of would the same. amount Crew business little the the

I benefits of mean, As that you using far mean, of it work, with as our to time. the can the is all kind the overall George, and of goes I blend fluctuations up subcontractor that subcontractor of in one in-house crews help down workload. work

both in strong So that region. very remains South North and the

with by would carriers. I the and all So to tell a can steady as major just four say continue our row. footprint revenue quarters four you widen she It's to in try we goes

able you Is for work? you? the that are pick Joe -- activity install And -- to does tower up away opportunity from there

good quite for I maintenance there's we would work. profitable generically and stay fashion. say and want we're engineering and focused getting George, work opportunity mean, to But nicely I a in on at integration work Yeah. honestly, what that

trying distracted be we're So now. mission from to right not our

mentioned originally this an Are to activity. wireless is you're the States footprint the the United of at operating point of you area? of in expand And your that center important part where on the you time area trying

we always mean can convinced to our our a trying carrier improve reduce tower I or a margins. be new and now to geography. into costs, by company right move maintain But a discipline we're

in get be positive COGS disciplined overhead getting the more factors and right of contributing – reasons wireless expansion and decided our and one expenses to was to net in the our with One we of focused place. the our income that geographic

telco the some turn focus in discipline I division combination of knocked quarter us wireless the out and So in injecting income. and net has of to to it this positive just think allowed the park

we'd that So keep going some that to off adventure. trend We to now like distracted. don't We want right to on don't want distracted with direction. be be in new rolling

in question then on just the general. And telephonic area Okay. a

the You're there and be having. are and and product your And north you the got outside add three have to from up in Miami – standpoint Alabama? operation your what four it momentum accomplish like activity you you're you've been appreciate come taken relative doing for your there's of to looks opportunities gaining problems what to some have out Because you're of to got activity? to really the that it or be much must industry customers still is you've working able basically to new very repair of last you and with of say is quarters responsibility off the and

times couple I my mean Yes. of it a in I said remarks.

excellent Nave Triton Michael those and I businesses. of and the the essentially, that's are job. put fiber Communications areas. decision which done Slacker And and United players that the Damon think made I the is They've across in Burch charge cable, were trying telco some the to build into pivot were business, Mike expansion to us to guys key States. for we They've product the able right Datacom following happening been an new optic in massive

construction follow place that products, switches taking wave transport across that things the optical to refer I when So routers, US. like it's to fiber of that's

been mode and both those great of have think really desirable a in at guys time, into a doing of bringing to the and a our job. mode under But and nice I of been same So done get the wireless probably trying has expense cost team less that job has control profitability.

to we've do a work I we're but So got place. think good more in still

that some activity. side taking the are market along represents quarter activity, the well you're in area. changes like It's to you're right. looks of both in the coming the having areas That's primary of how areas telecom on with real it And grow opportunity place

of show the two here really you combination that hope can looks And too. year it for you've should a next of obviously that, in real you fiscal a like the certainly a activity forward. that be overall going be next areas accomplish got Thanks. could you real broadly -- quarter breakout continue can we breakout to and So

George. you, Thank

Jensen, Bob Private [Operator question Instructions] Investor. next We'll take from Thank you. our

anything? over guys Yeah. are heard might Yeah. too cell relations us Congratulations vulnerability you Recently on It cause heard China some a with since this, good. not Chinese was good concern there quarter. Have our some towers.

in cell and using I networks about the think installed Air what et they installed to the there's a Chinese manufacturer government that like about Chinese their equipment et wireless a think to customers. whole might them, but the lot of press lot from authority be the direction. not by federal the and who And Force bases you're on I'm for right? a is being program et the And I been them. funding Midwest cetera, big has strategic don't that near that's what and massive towers of Chinese-made equipment think equipment Bob. of it the doesn't carriers, that of cetera, it referring point me it, multibillion-dollar to. subsidize replace rip referring you're those press you that Huawei cetera a is rural use referring I sound another manufactured network really in replacement Huawei. that's but that, Most on in to has four banned If were

think I probably No Yeah. that's correct.

of was I curious guys. up you So opportunities kind just for whether opened to as that any additional

I Well, think,…

sounds you not. It probably like are

work have manufactured It'll space. of in new depending wireless so it radio, to old world the going upon Nokia, out usual Ericsson, Samsung. and It's equipment be do the equipment, to equipment. taking by replacing OEMs is physical of in new with …somebody one who it be is that will the the the

we'll But areas, our So chase in got that looking not be outside as we've I confidence. for it said we're geographic of to where to lot going a strong space. of George, opportunities

Yeah.

Okay, okay. for Thanks response. the

Welcome.

welcome. You're

[Operator I'd you. no remarks. any We turn additional like to additional management back for the questions in queue. Thank the or over Instructions] to conference have closing

That's all it interest like ask have we future. This those Operator. you listen your called of in, thank it. that interest in that you, and Hi. by a to later for And I'd for we ADDvantage to And all. recording. Joe. for appreciate Group. Thank by investor close you your Technologies bright just have We support. is thanking We think

for We participation. Thank you. That thank all you your does conclude conference. today's

disconnect. may now You