ADDvantage Technologies Group Inc (AEY) 2022 Q1 法說會逐字稿

Good day, and welcome to the ADDvantage Technologies Fiscal 2022 First 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.

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

Before we begin today's call, I'd like to remind you that this conference call may contain forward-looking statements which are subject to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, among other things, statements regarding future events such as the ability of ADDvantage Technologies and its subsidiaries to maintain strategic relationships and agreements with certain original equipment manufacturers and multiple system operators, as well as the future financial performance of ADDvantage Technologies.

These statements involve a number of risks and uncertainties. Participants are cautioned that these forward-looking statements are only predictions and may materially differ from actual future events or results due to a variety of factors, such as those contained in ADDvantage Technologies' most recent report on Form 10-K on file with the Securities and Exchange Commission. Financial information presented on this conference call should be considered in conjunction with the consolidated financial statements and notes included in the company's press release issued earlier today and included in ADDvantage Technologies' most recent report on Form 10-K.

The guidance regarding anticipated future results on this call is based on limited information currently available on ADDvantage Technologies, which is subject to change. Although any such guidance and factors influencing it may change, ADDvantage Technologies will not necessarily update the information as the company will only provide guidance at certain points during the year. Such information speaks only as of the date of this call.

During the call, we may also present certain non-GAAP financial measures such as non-GAAP net income and certain ratios that are used with these measures in our press release and in the financial tables issued earlier today, which are located on our website at addvantagetechnologies.com. You will find a reconciliation of these non-GAAP financial measures with the closest GAAP financials and the discussion about why we believe these non-GAAP financial measures are relevant. These financial measures are included for the benefit of investors and should be considered in addition to and not instead of GAAP measures.

I'd like to now turn the call over to Joe Hart, President and Chief Executive Officer of ADDvantage Technology. Joe, please go ahead.

Thank you, Brett, and thank you to everyone joining us on the call today.

We continued our strong revenue momentum in the first quarter with significant growth in both our Wireless and Telco segments, leading to 47% consolidated growth on a year-over-year basis for the quarter. This growth, and the accelerating 5G rollout, give us significant confidence in continued revenue ramps during the balance of this fiscal year.

As we have been saying, the 5G rollout has finally begun in earnest, leading to significant activities from multiple customers in several states, and we expect our Wireless revenue to continue to grow from the $7 million range in the second fiscal quarter, with further expansion in the second half of the fiscal year.

Our focus now turns to improving our operating efficiency and properly aligning our resources for future demand, enabling us to expand gross and operating margins while we deliver exceptional service to our customers. The ramp in resources during the last 2 quarters and expansion into new markets has adversely affected margins for Q1 and into our Q2 of this fiscal year. Action has been taken to improve margins, and we will be reducing operating and general and administrative expenses to drive margin expansions over the next 2 quarters. Our entire wireless team is hard at work at managing this rapid acceleration, working closely with our customers to make sure we have crews in place to deliver on work orders as permits are approved. Investors should expect not just revenue growth, but margin expansion as we move through the year, likely peaking in our fourth fiscal quarter.

While wireless revenue related to tower work and other aspects of the 5G rollout has already increased by 36% year-over-year, we expect that it will continue to grow throughout this fiscal year. Our recent growth has been broad-based, involving several carriers, including both long-standing customers and new entrants to the market. The work touches all the regions we service, spread across the center of the United States and touching many large metropolitan markets. Our pipeline of new projects, meaning work we have been awarded where we are waiting for purchase orders as permitting is completed, gives us significant confidence that the long-awaited 5G surge will continue to accelerate for us in the near term.

As I mentioned last quarter, we already have purchase orders in hand for fiscal year 2022 construction that exceed the total value of our fiscal year 2021 total Wireless revenues. Over the last few months, we have won site awards to upgrade technology to 5G for over 700 cell sites, and we have increased our staffing to meet this growing demand. In fact, staffing is the most challenging part of this growth in this tight labor market. Currently, we are running at 45 crews and will be ramping up from there in subsequent quarters. The 5G opportunity represents a multiyear secular trend, not just for tower work but for data centers, technology providers, handset manufacturers and wireless carriers. Each of the wireless carriers are investing hundreds of millions of dollars in the expansion, and the CapEx plans of the carriers are public information and widely discussed. We are fortunate that as this wireless segment quickly expands, we are simultaneously benefiting from other trends that are driving strong results in our Telco segment.

The office dynamic has changed and people are working from home, requiring an expansion of the telco infrastructure to facilitate a remote workforce. Simultaneously, the well-documented chip shortage and supply chain issues have elongated the delivery cycle for new telco equipment, and import price increases have made new equipment more expensive. All of these factors make our refurbished equipment sold by Nave and Triton a more compelling and viable option. You can see the results and the financial performance of our Telco segment, which finished its third consecutive quarter over $11 million in revenue with an increase of 54% compared to the quarter of last year. We continue to anticipate a leveling off of demand at some point in future quarters, albeit at a somewhat elevated level relative to the recent past.

Overall, we delivered a 45% revenue growth in the quarter. Our margins and overall profitability were impacted by the increased spending to ramp up crews and capabilities as we expanded into new markets in advance of the coming demand. But we believe that margins will begin to improve late in the current quarter with further margin expansion as we move through the year and our business reaches the necessary inflection points where volume is able to offset fixed costs. We also began reducing G&A and operating expenses as our new markets mature, and we enter the second half of the fiscal year.

With that, I'll now turn the call over to Michael Rutledge, our CFO, to provide a more detailed review of our financial results. Michael, please go ahead.

Thank you, Joe. Consolidated sales increased $6 million or 47% to $18.7 million for the first quarter from $12.7 million for the 3 months ended December 31, 2020. The increase in sales was due to increases in Wireless sales of $1.9 million and Telco sales of $4.1 million. Consolidated gross profit increased $1 million to $4.6 million for the quarter compared to $3.6 million for the same period last year. The increase was due to an increase in the Telco segment of $1.1 million, offset by a Wireless segment decrease of $0.1 million.

Operating expenses increased $0.5 million to $2.5 million for the quarter compared to $2.0 million for the same period last year. The increase reflects the company's investment in its regional growth strategy related to expected 5G infrastructure growth. Selling, general and administrative expenses increased $0.5 million or 15% to $3.7 million for the first quarter from $3.2 million for the same period last year. The increase in SG&A relates primarily to increased selling and commissions expenses to support higher revenues. Net loss for the quarter was $2.0 million for the first -- or a loss of $0.16 per diluted share based on 12.7 million shares compared with a net loss of $2.0 million or a loss of $0.16 per diluted share based on 12.1 million shares for the same quarter last year.

Turning to our balance sheet. Cash and cash equivalents were $1.8 million at December 31 compared to $2.6 million as of September 30, 2021. Cash was used primarily to fund operations. As of December 31, 2021, the company had net inventories of $5.7 million. We continue to believe we are sufficiently capitalized with appropriate backstops to support near-term business conditions until more normalized business conditions return. This concludes the financial overview segment of our remarks. I will now turn the call over to the operator to facilitate any questions.

(Operator Instructions) And we'll go first to William Velmer with S. A. Advisory.

Yes. A couple of brief questions. Number one, can you give us a real number of backlog? Everything seems very mysterious. What's the real backlog here right now? First question.

The backlog for wireless is based on -- yes, this is Joe. The backlog for wireless is based on the number of purchase orders in hand or sites assigned where we're waiting for the purchase order to come through. But -- I mean, when I said we have 700 sites in backlog, I mean, that's what that refers to, right? Now, have we burned off some of that backlog, yes. In the first quarter, we burned off $7 million. The 700 sites that I referred to relate to about $28 million in total backlog, and so we burned about $7 million of it in the first quarter. And as we progress through this quarter, next quarter and so on, we'll continue to get additional sites assigned to us by the carriers. So backlog is a bit of a moving target, but the 700 sites that I referred to is -- typically, you take an average revenue per site of about $40,000. And by the way, amongst carriers that can vary fairly widely, but it's probably not a bad number to use.

What about the rest of the subsidiaries? What's your backlog of the other subsidiaries?

Well, the Telco equipment subsidiaries are essentially similar to retail ordering and bid-and-ask kind of opportunity, so they don't typically have a backlog. They're on-demand orders that come through Amazon, Shopify, et cetera, in the case of Triton Datacom, so that's a daily, weekly transactional kind of business. The Nave Communications has a little bit more runway of about a week's view of orders that are in process, but they're high transactional businesses. Not really subject to backlog, more based on historical run rates.

So we talk about the bottleneck, that's the topic of choice these days. How much of your business is being affected by backlog, bottleneck, can't get the product? And if that's the case, are you raising your prices? I mean you've had a good quarter, but you keep promising a better -- an EBITDA that's positive in earnings. But here, we have another quarter, we lost another couple of million dollars. You can't keep losing money when you explain to us that business is growing rapidly and you keep -- still keep losing money. This is the third quarter since I've watched you guys and it just seems to be kicking the can down the road.

Yes. Our Telco business is making -- I mean, it's making nice margin and making good EBITDA contribution. The issue is on our wireless construction side where we have deployed to multiple new geographies and new markets, and have increased our expenses in order to get deployed to those geographies and have teams in place and logistical support also there in those markets. And that is a ramp that -- it's one of those you experience as you're better off to overwhelm the front end with resources and perform well for your customer right out of the gate, and you ensure a much better future by doing that. Once you're in place and deployed and the market sizing shows itself, then you can trim the resources appropriately and that's what we intend to do. We intend to reduce our G&A and operating expenses on the wireless side of the business over the next couple of quarters to get back to consistent levels of profitability and EBITDA contribution.

So you're basically...

(inaudible) you're correct. Yes.

So basically, you are -- you're getting players. And once you've got the players and they're happy, they're not going to -- they're not going anywhere. And this allows you to give you greater flexibility with increasing margins. Would that be a fair assumption?

Well, in the demand in these new markets, you're -- you don't get hard promises on a level of demand as you deploy to these new markets, but you have a certain amount of purchase orders which makes the justification for deployment to that area justified, but you're uncertain of the demand. As that demand shows itself, you then level the resources and reduce your spend because you're there, and you can make good decisions about what the appropriate level of expense to revenue is.

And we're in a total growth mode, right? We're essentially doubling or more the size of the company, and expenses have led the way to fuel these deployments. Now is the time -- as we move through the end of this current quarter, now is the time to start recalibrating those expenses and get it back into a profitable situation.

Well, you know that I've listened to you guys before, as I've mentioned. And isn't it time to maybe upgrade that presentation? That's kind of very stale to give us some vision of the company in writing that people can review and maybe do a couple of dog and ponies with some brokerage firms out there to get your name. It's kind of been stale for a while. And since you say you're in a growth mode and ramping up, this would be an ideal time to visit the brokerage community because you definitely can use some cash. And I think that, that should be something to consider, number one.

And number two, a different question is this second quarter, we're still in kind of the winter environment. Does that seem to affect business ramp up in the areas that you are -- the majority of your work is conducted?

Yes. Kind of a combination of the latest COVID variant that hits crews, both our internal crews as well as subcontractor crews. That's a bit unpredictable, as well as any winter storms that pass through. Like in Texas a week or 2 ago, we were down for a couple of days. So, so far, knock on wood, work continues in the Midwest, but there are days or a few days in a row where we're shut down for weather. So we tried to build that into our budgets. We -- a lot of us have been doing this for a long time, so you never know when winter will hit, but it's predictable that it will hit in January, February, March in the Midwest.

Correct. And what about the -- go ahead.

No, that's okay. Sorry for interrupting.

No, I was curious on -- what about an upgrade to a presentation and to do some dog and pony shows with some of these brokerage firms out there to get some new eyeballs? Because you do have the tendency, you don't put any press out. You don't really let us really know what's going on except for the filings of Qs and Ks. So maybe that should be -- should maybe get a little more aggressive on attracting eyeballs.

Yes. I think that's a great suggestion, and thank you for that. I -- my preference is when we get to breakeven and we're about to approach profitability, that's when I'd like to be standing out there in front of investors touting that we have grown the business and we have turned it around and gotten it back to profitability. So that's the game plan. And from a timing perspective, your suggestion is most likely something we would prefer to do starting later next quarter.

Well, there is...

We can get the presentation updated. Yes.

But there is the -- in many cases, there are companies that always are waiting for things to be perfect, and they never are. And waiting for the profitability bell to be rung, maybe you should look at it prior to the bell being rung. You're crowing about your revenue growth, your market size, businesses are expanding. I really think it's time to really -- instead of waiting for profitability, start to tell people about it since you already expanded on your -- on the revenue growth, the possibilities, the potential, you're increasing the size of your workforce and your crews. I mean, that sounds pretty positive. We're just missing one ingredient.

So maybe investors should start to be told now while the stock is basically hovering around the dollar, which is really kind of sad. Just -- I mean, it's time to get some eyeballs on this thing. Things aren't perfect, but I think you owe shareholders that route of presentation and acknowledgment that you're out there growing. So that's kind of where I'm at.

I think Michael and I are sitting here shaking our heads in agreement with you, so -- you have our commitment to get moving on that front.

Lastly, maybe occasionally put out some kind of press release and tell us what's going on. I mean, instead of waiting for the quarter to end. I mean, that's 3 months, we won't be hearing from you most likely for 3 months, and you don't want to get lost. There's a lot of competition out there for people to buy stocks in companies, and you get lost. I mean, you're in such an exciting area of communication. I mean, we've been waiting for 5G for years and it's here. And waiting for profitability, I don't think is the answer. I think you need to pound the drum now.

We'll go next to Kurt Caramanidis with Carl M. Hennig.

Trying to get a little more color on what you were saying. You probably have mapped out, investors are probably wondering. Do you see cash flow breakeven or cash flow positive by mid-year? It sounds like based on kind of what you're saying on a monthly basis, where do you kind of see that turning? April, May, June, something like that?

It's not in the current quarter, but it's -- it's -- the plan is for it to start turning in that direction hard in the third quarter and be there in the fourth quarter. I mean, that's our current projection.

Okay. Do you see any insider buying coming? Management team at these levels, with your confidence in the business to go forward and all that kind of thing with where the stock is at? Any idea on board or management stepping in to show confidence?

I think it's a great suggestion. We haven't had that discussion amongst ourselves here in the building with the management team. But certainly, with the share price where it is, it -- unfortunately, where it is, it's a great time to consider that. So we'll take your suggestion in hand here and see what we come up with.

We'll go next to [Edward Culverwell], Private Investor.

Yes. This is Ed [Culverwell]. I'd like to get some explanation of the volume. I can't quite understand how you can possibly have almost $13 million shares trade in one day when it's actually more than the stock I'm seeing. Can you make a comment on that? There must be some connection to the company people or some of your institutions. I mean, you've got mutual funds, you've got other groups that own the stock and I can't imagine the whole volume trading in one day.

Yes, that's -- Ed, this is Joe. It's happened a few times to us over the last 2 or 3 years. Now, those big days over the last couple of years have been like a $3 million a day or a $4 million a day. The recent $13 million a day was, I mean, there's -- I don't think there's any real explanation for it, something -- you start to get some growth and some activity going, and you trigger some algorithms in some of the investment houses and trading firms and all hell breaks loose, and everybody thinks they know some kind of secret. There was no logical explanation based around the business trends or business news or anything else on our side that triggered that. It was strictly an oddity of the market these days. And there's probably other people on the call that are more advanced in trying to explain that. But we certainly have...

Well I have been hearing that, but, yes, -- but this -- the -- normally, we had $12 million shares, you see this price to go up. I mean, we're going through the roof.

It's - this is Brett. It's the advent of algorithmic trading, right? There's just a few flip in shares -- few flipping shares back and forth very rapidly, the same shares just change hands very rapidly. So unfortunately, that's the world -- the trading world that we now live in, right? I mean, there's an audience watching the stock and hopefully, you keep longer-term shareholders within this volume. The longer-term shareholders see their liquidity, and they start to buy shares and accumulate, and it settles down a little bit. But the algorithm trades is what's doing this and the results -- the positive results of management.

Is there any self registrations out there that could be affected by this? I know you're talking about raising money. When someone takes a look at this, it looks as if they have been arranged privately maybe on -- at that particular time reflected in the $12 million, but...

Yes. I mean, we still have an active S3 registration that's about 2 years old now that still has about $9.5 million of capacity left in it. We -- we have not been active in it and at current share price, probably won't be active in it for a while, but it's still there. We would like to use it at some point, but -- that's why our total focus is on improving the performance and profitability of the company. And then we believe the share price will take care of itself from there. Along with other good suggestions like update our presentation on the website, issue more press releases, very basic marketing, so.

I certainly say -- second the idea of getting out and telling your story. I mean, there's so much publicity out there in 5G and such a positive nature, and people aren't even aware of the company. I'm not talking about hustle in the stock, I'm just talking about giving people the opportunity to see what the potential is.

You don't have to wait when it looks profitable. People would like to get it at a lower level. When you are profitable and things have turned, assuming they do, it will be reflected, and then people will be trying to buy the stock. And as you know, there's really a very small float the last time when they got a short position. They had the shorts of [stock range of sellers]. It's -- they're not -- this isn't going to happen all of a sudden. When you show one quarter of profitability, then everybody is going to try to get through the door. Hopefully.

Agreed, agreed. Yes.

We'll go to next to [George Gaspar], private investor.

Yes. I'd like to dig into this 5G cell that took place on this issue regarding aircraft problems close to airports on landing. And can you describe what it's been like for your crews in and around these particular airports nationally or in the areas, obviously, that you're working in. But were you required to get back up on towers to do some work when the airlines were insisting on having the communications temporarily closed off? Or is that -- can that all be done from the ground level and it doesn't require any of your work? Can you explain that?

I can explain what I know and think is going on, but we have not directly been involved with either installing radios within the glide path to and from any airports this year. It's specifically in the C-band block of spectrum that was auctioned off a little more than a year ago by the FCC. It affects the altimeters of some aircraft types, not all. And really, it's -- as I read, it's a matter of AT&T and Verizon on those towers that they have installed new radios related to the C-band spectrum. They hadn't actually turned any of it on. They were about to, and so they were asked to hold by the FAA, they all agreed. And then since then, they've agreed to either redeploy that spectrum outside the glide paths.

I think it's simply a matter of giving the aircraft manufacturing industry a chance to replace and upgrade the technology on the aircraft altimeters. And once they get all that done over the next couple of years, it won't be an issue. But for the meantime, it is on some aircraft.

So it hasn't affected our business whatsoever, and both AT&T and Verizon have the ability to turn those radios on and off in that spectrum or to not actually engage those radios. But I mean the -- both companies continue to deploy that new technology all over the U.S., and they're just trying to adjust it in the glide paths.

Okay. All right. Okay. The next one is on the crew development. You indicated that you're at the 45 crew level. Now, how do -- can you tell us how many are in-house crews and outside -- inside crews of the 45? And can you give us a comparison of how that has developed, let's say, since at the close of the last fiscal year with September? And where's your -- what's your upside target in total crews and in-house crew?

Yes. I guess I would say I have no real upside target or, I'll say, maximum threshold, [George]. If the business continues to double year-over-year this year and next year and the year after, then we'll be expanding the crew count accordingly both geographically, as far as following the work with carriers or improving the density within existing geographies. So I don't have any limit in my head or in our budget plans as far as total crew count. It -- we match the crew count to match the backlog, right? And there are weeks where that can go up and down a little bit, where either we hit weather delays or we might hit some permitting delays, and then everything gets completely turned back on in a small geographic area I'm talking about.

So we're at 45, we were probably running in the mid-30s on the last quarterly call. I say probably but, I mean, I know it because we track it on a daily basis. As far as ratio of internal crews to subcontractor crews, we're probably sitting at the moment at about 3:1 subcontractor crews to in-house crews. I have, for decades, believed in the strategy of having a bigger subcontractor base of technicians and crews than your in-house, and that becomes your insurance policy and buffer against the ebbs and flows of the work.

So we're very happy with where we're at. It is a very tight labor market. We're constantly recruiting, and it's quite the wild west out there as far as recruiting and retaining valuable crew resources. So we work that every day, every week. It's a full-time job. So we're kind of happy with where we're at right now with crew count.

Okay. That's interesting. On the actual work that you do daily or weekly, can you give us a percentage of how much is on the towers and how much is off -- away from towers? Can you -- is there any way of giving us some indication of what the revenue stream is versus your total?

Well, I would describe it as -- it's all on the cell site, so it's within the fence line of an existing cell site. And for example, in the case of the new DISH installations, it's about 40% civil work, which is on the ground. So it's trenching for conduit for fiber optic cables and power cables to bring it over to the radio cabinets. We have -- we build platforms so we can mount their radio cabinets above ground, a couple of feet off the ground. And -- so that civil work is probably about 40% of the scope of work, and the on-tower work is probably 60%, and that can vary from site to site, carrier to carrier.

Okay. And can you describe the outline of your activity in total on a state-by-state basis? Is it -- is the Midwest area is still -- from Chicago or Milwaukee on the top to -- Southern Illinois and Michigan over to Minnesota or Nebraska? And obviously, Texas, I'm sure, is important. Can you just give us a little color on how you have been and where you're trying to go?

Yes. It varies from year-to-year depending upon the carriers deployments for the new technologies and the markets that they built the prior year and are changing the following year, so it migrates. But this year, we're probably -- we're probably -- we're probably back to about 35% Midwest and about 65% Southwest.

65% Midwest and 35% South side, is that what you are saying?

No, it's the opposite. It's about 35% Midwest, about 65% Southwest, yes. And we believe that later in the year and next year, that will shift, that there are some big plans taking shape for the Great Lakes area, so that will probably shift somewhat.

Okay. All right. Good. And then a question on the increase in shares outstanding in the quarter. I believe it was like 400,000? Am I correct on that?

It was about 600,000 yes.

600,000. Okay. How many of those shares were distributed to employees, and -- and where are they at a certain price?

The majority of those shares were actually purchased through the S3 during the quarter, at various points during the quarter.

Yes. That -- I mean, yes. Quite honestly, that day where the volume went off the charts to $13 million, we tagged along on the back end of that day and sold some shares just because of the sheer volume of activity. And our -- our employees are basically on 3 years at a time, so they get restricted shares of stock based on performance on an annual basis and that vests over 3 years for any particular offering. So it's -- it's not a large number of shares in totality, but in any given year, it's probably an extra maybe 100,000, 150,000 shares, something like that.

I see. I see. Okay. That's encouraging. And one question on talking about Telco and that whole segment, which has done very well. I mean, it's -- you don't hear too many people congratulating you on the work that went through in building your new equipment and warehousing and operation in Florida and outside North Miami, and how that's all going. And of course, as you have indicated today that a lot of this activity that you've experienced in recent few quarters, it relates to people working remotely and the lack of new equipment availability. Do you have any thoughts about expanding that operation to -- geographically or in terms of equipment distribution expansion? Any thoughts on this?

It's -- I mean, we think about it and talk about it all the time, for sure, every quarter. We're reviewing the existing inventories every quarter. It's a bit of a tricky business as far as your inventory that you have on hand is constantly aging. So we're trying to play off selling down existing inventory while we're finding products that we can sell on a flip basis, where we don't have to -- we find the inventory, we buy it and then we sell it and -- comes in the left hand goes out the right hand, kind of thing.

I think we believe that we're in a bit of a temporary situation considering the global chip shortage and the global supply chain logjam. We think that, that will -- that will eventually write itself. Our team has done just a fabulous job here in the last 18 months, and we have seen expanded sales to new clients and new fiber competitive access carriers. So I think it's more about expanding our sales channels, not necessarily the product lines. We want to stick with what we're really good at, and we think that the market situation is a bit tenuous. So we're, I think, a little cautious about investing a lot in new product or new product inventories right at the moment. And frankly, you see -- you frankly see our cash situation. So it's not like we've got a stockpile of cash that we can go off and divert into a lot of new inventory.

Okay. And you mentioned cash position. My last question, could you identify again, the amount of money that is coming into the company on the basis of the sale of the division to David Chymiak that took place a couple of years ago? What's the -- is that -- does that come in quarterly? And how much does it amount to on an annual basis at this point?

Dave had a 5-year note, which was all public information. Dave had a 5-year note and Dave paid that note off in full probably about a year ago or so, so there's no incoming monies from that former sale of Tulsat.

So there isn't anything coming in at this point from that sale?

No.

Okay. All right. Okay. Appreciate it. It could be very interesting over the next 3 to 6 months to see this pop. And based on what we did in the last quarter of $17 million range and by far, that $68 million, I would assume that you can drive this up to $85 million to $100 million in a year now. Any comment on that?

Well, certainly, manageable growth. Growth that -- we'll take all the growth we can get as long as it fits the strategy of the company and is in the geographies we can serve and we can make money on it, right?

All right. Okay. Best of luck to you going forward here. We're all rooting for a real success.

(Operator Instructions) We'll go next to [Anthony Marchese], private investor.

Your sales for the quarter are greater than your entire market cap at this point, so clearly, people are disappointed in what's been going on. You speak very elegantly and growingly about the future of the company.

I'd like to make a suggestion that is to see some insider buying. We haven't seen anything since, I believe, in 2020 at significantly higher prices by 1 or 2 individuals. I see 0 insider buying by any of the directors. So on one hand, we got a lot of confidence. On the other hand, I think, to really show a bode of confidence, it would be nice to be able to see some insider buying. And again, I'm not trying to count people's money, but certainly, to see 0 insider buying given all the opportunities, all the success that you forecast, I think that would be the best way to convince people that this turnaround is for real.

Yes. I think it's a great suggestion, and it's timely as well. I would use a bit of a weak excuse and just say we've had our heads down trying to manage our way through all this growth and turn the company back to profitability. We've kind of lost sight of that, and I appreciate both yourself and the previous investor that asked the same question for reminding us of the signal that it sends to the marketplace. So I appreciate the suggestion and...

Yes, it's going to make it a lot easier -- it's going to make it a lot easier for Brett and his team to market the company, and we're able to introduce the company as a company that is a cheap on a -- on an asset basis, sales basis, whatever you want to call it. And at the same time, be able to say, hey, not only is it cheap, but insiders are showing their confidence by buying the stock at current levels. So ironic, the stock is trading at a 52-week low and yet your sales are just beginning to what looks like ramp up significantly. So in any case, it's just -- it's just -- it's going to make it a lot easier to market the company if you go forward with the insider buying as evidence of the confidence of management.

Yes. Thank you for the reminder. We appreciate it.

And at this time, there are no further questions.

All right. Well, thank you, everybody, for joining us on the call today. We appreciate your support. We appreciate your interest. We are clearly focused on returning this company to profitability. We've been deep in the effort of trying to grow the business, and both the Telco and the Wireless side have shown nice growth 2 quarters in a row. On the Telco side, it's been 3 quarters in a row. And now is the time to get this company back to a profitable situation. And so that's our mission here, over the next 2 quarters, is to get us back in that position in a solid fashion and set the stage for fiscal 2023 already. So thank you again for your time and your interest. Thank you, operator.

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