Allient Inc (ALNT) 2023 Q2 法說會逐字稿

Good day, and welcome to the Allied Motion Technologies Second Quarter Fiscal Year 2023 Financial Results Conference Call. (Operator Instructions) Please note this event is being recorded.

大家好，歡迎參加 Allied Motion Technologies 2023 財年第二季財務業績電話會議。 （操作員指示）請注意，此活動正在錄製中。

I would now like to turn the conference over to Mr. Craig Mychajluk, Investor Relations. Please go ahead, sir.

現在我想把會議交給投資人關係部門的Craig Mychajluk先生。先生，請講。

Yes. Thank you, and good morning, everyone. We certainly appreciate your time today as well as your interest in Allied Motion. Joining me on the call are Dick Warzala, our Chairman, President and CEO; and Mike Leach, our Chief Financial Officer. Dick and Mike are going to review our second quarter 2023 results and provide an update on the company's strategic progress and outlook, after which we'll open it up for Q&A. You should have a copy of the financial results that were released yesterday after the market closed. If not, you can find it on our website at alliedmotion.com, along with the slides that accompany today's discussion.

是的。謝謝大家，早安。我們非常感謝您今天的寶貴時間以及您對Allied Motion的關注。我們的董事長、總裁兼執行長Dick Warzala和財務長Mike Leach將與我一起參加電話會議。 Dick和Mike將回顧我們2023年第二季的業績，並介紹公司策略進展和前景的最新情況，之後我們將進入問答環節。您應該已經拿到了昨天收盤後發布的財務業績副本。如果沒有，您可以在我們的網站alliedmotion.com上找到它，以及今天討論的幻燈片。

If you are reviewing those slides, please turn to Slide 2 for the safe harbor statement. As you are aware, we may make forward-looking statements on this call during the formal discussion as well as during the Q&A. These statements apply to future events that are subject to risks and uncertainties as well as other factors that could cause actual results to differ materially from what is stated on today's call. These risks, uncertainties and other factors are discussed in the earnings release as well as with other documents filed by the company with the Securities and Exchange Commission. You can find these documents on our website or at sec.gov.

如果您正在查看這些投影片，請翻到投影片2查看安全港聲明。如您所知，我們可能會在本次電話會議的正式討論和問答環節中做出前瞻性陳述。這些陳述適用於受風險、不確定性以及其他可能導致實際結果與今天電話會議所述結果大不相同的因素影響的未來事件。這些風險、不確定性和其他因素已在收益報告以及公司向美國證券交易委員會提交的其他文件中進行了討論。您可以在我們的網站或sec.gov上找到這些文件。

I want to point out as well that, during today's call, we will discuss some non-GAAP measures, which we believe will be useful in evaluating our performance. You should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP. We have provided reconciliations of non-GAAP to comparable GAAP measures in the tables accompanying the earnings release and slides.

我還想指出，在今天的電話會議上，我們將討論一些非公認會計準則 (non-GAAP) 指標，我們認為這些指標將有助於評估我們的績效。您不應將此類補充資訊的呈現視為孤立存在，或將其視為根據公認會計準則 (GAAP) 編制的業績的替代。我們在收益報告和投影片隨附的表格中提供了非公認會計準則 (non-GAAP) 指標與可比較公認會計準則 (GAAP) 指標的對帳表。

With that, please turn to Slide 3, and I will turn it over to Dick to begin. Dick?

請翻到投影片 3，然後我會把它交給迪克開始。迪克？

Thank you, Craig, and welcome, everyone. And I'd like to start the call with some off-script comments, as I have something I would like to relate to everyone. Sadly, Dick Smith, our former CFO, CEO and Chairman of the Board, pass the way this past Sunday after a brief illness. Dick was the first one that brought me into Allied at that time halfway 22 years ago and for that, I will forever be grateful.

謝謝克雷格，歡迎大家。首先，我想說幾句即興的評論，因為我有一些事情想和大家分享。令人難過的是，我們前任財務長、執行長兼董事會主席迪克史密斯（Dick Smith）於上週日因病去世。 22年前，正是迪克第一個把我帶入了聯合公司，我將永遠心懷感激。

Dick was a great friend, partner and he exhibited the highest levels of honesty, integrity and willingness to do what was right for the company. Beyond that, Dick was a family man and family always came first. Our thoughts and prayers will go out to Dick and his family. Rest in peace, Dick. We will miss you, and you will not be forgotten.

迪克是一位很棒的朋友和合作夥伴，他展現了極高的誠實、正直，並且願意為公司做正確的事情。除此之外，迪克還是個顧家的男人，總是把家庭放在第一位。我們向迪克和他的家人致以慰問和祈禱。迪克，安息吧。我們會想念你，你不會被遺忘。

Now I'll start with the script as we have written here. So first off, we continue to successfully execute our strategy by delivering record sales with double-digit organic growth and strong operating leverage, which translated into a measurably improved bottom line and solid cash generation. Our 20% top line growth reflected strength in each of our 4 targeted markets, highlighted by continued strong demand with our industrial markets, which increased 39% over last year's second quarter. What drove our industrial strength with industrial automation projects, power quality solutions for oil and gas and HVAC and continued demand for material and a vehicle handling systems. We also benefited by shifting some of the long lead projects that were in our backlog.

現在，我將按照我們之前寫好的腳本開始講解。首先，我們繼續成功執行策略，實現了創紀錄的銷售額、兩位數的有機成長和強勁的營運槓桿，這轉化為顯著改善的盈利和穩健的現金流。我們20%的營收成長反映了我們四個目標市場的強勁成長，其中特別突出的是工業市場持續強勁的需求，比去年第二季成長了39%。工業市場強勁成長的驅動力包括工業自動化項目、石油天然氣和暖通空調的電能品質解決方案以及對物料和車輛處理系統的持續需求。我們也受益於一些積壓的長期專案轉移。

Aerospace and Defense markets grew 11% during the quarter due to incremental contributions from acquisitions and defense program timing. Vehicle market sales increased 7% due to continued ramping of commercial automotive programs, partially offset by lower agricultural vehicle demand in Europe. Lastly, medical markets were up 3% overall.

本季度，航空航太和國防市場成長了11%，這得益於收購和國防專案時機的增加。由於商用汽車項目持續擴張，汽車市場銷售額成長了7%，但部分抵消了歐洲農用車需求的下降。最後，醫療市場整體成長了3%。

Driving higher margins continues to be a focus. And while we saw some contraction in gross margin for the quarter, which was largely impacted by mix, we are seeing the leverage play out in our operating performance as we delivered record operating income of $12 million with a margin of 8.2%, which was up 210 basis points.

提高利潤率仍然是我們的重點。雖然本季毛利率有所下降，這主要受產品組合影響，但我們看到槓桿效應在營運績效中有所體現，我們實現了創紀錄的1200萬美元營運利潤，利潤率達到8.2%，同比上升210個基點。

Given the improved operating performance, net income per share increased 45% to $0.42 per share. On an adjusted basis, net income per share was up to $0.58 per share. We generated significant cash from operations of $13.7 million and reduced our debt balance by $9.4 million during the quarter. Our orders were up sequentially, further emphasizing demand in the market, while our backlog was down since the first quarter due to continued improvements within the supply chain. I will talk about this performance later in the presentation.

鑑於營運績效的改善，每股淨利潤成長45%，達到每股0.42美元。經調整後，每股淨利達到每股0.58美元。本季度，我們營運現金流顯著增加，達到1,370萬美元，債務餘額也減少了940萬美元。訂單量較上季成長，進一步凸顯了市場需求。同時，由於供應鏈持續改善，我們的積壓訂單量自第一季以來有所下降。我將在稍後的演示中討論這一業績表現。

The first half of 2023 has positioned us for a strong year. Our entire team is energized by the continued growth and operational successes throughout the company, and we expect to continue executing our strategy well into the future.

2023年上半年，我們已為強勁成長做好了準備。公司持續的成長和營運的成功令我們整個團隊充滿活力，我們期待在未來繼續執行我們的策略。

With that, let me turn it over to Mike for a more in-depth review of the financials.

說完這些，讓我把話題交給麥克，讓他對財務狀況進行更深入的審查。

Thank you, Dick. As a reminder, our results include the acquisitions completed during the second quarter of 2022. Starting on Slide 4, we provide some details regarding our top line. Second quarter revenue increased 20% or $24 million to a record $146.8 million. The unfavorable impact of exchange rate fluctuations on revenue was $0.4 million in the quarter. Organic revenue growth was 17%. Dick touched on the quarterly sales highlights for our targeted markets and end market demand. One other sales channel, which is still a small component of our total is distribution, which has continued to see solid growth and was up 17% in the quarter.

謝謝，迪克。提醒一下，我們的業績涵蓋了2022年第二季完成的收購。從第4張投影片開始，我們提供了一些關於我們營收的細節。第二季營收成長20%，即2,400萬美元，達到創紀錄的1.468億美元。匯率波動對本季營收的不利影響為40萬美元。有機收入成長了17%。迪克談到了我們目標市場和終端市場需求的季度銷售亮點。另一個銷售管道是分銷，它仍然只占我們總銷售額的一小部分，但它繼續保持穩健成長，本季成長了17%。

Slide 5 shows the change in our revenue mix by market on a trailing 12-month basis and the drivers behind that change. Industrial continues to be strong and remains our largest market, making up 41% of our total TTM sales. The 40% growth in the industrial space is driven by the specific markets identified. A significant portion of our backlog reduction occurred with customers in our industrial markets as well.

幻燈片5展示了我們過去12個月按市場劃分的收入結構變化及其背後的驅動因素。工業市場持續強勁，仍然是我們最大的市場，占我們過去12個月總銷售額的41%。工業領域40%的成長是由我們確定的特定市場所推動的。我們積壓訂單的減少也很大程度得益於工業市場的客戶。

Solid organic growth, defense program timing and contributions from acquisitions contributed to substantial growth and performance in A&D. Medical growth has benefited from the gains in the medical mobility market and vehicle market revenue was up slightly on a trailing 12-month basis as commercial automotive, power sports and truck demand more than offset weaker agricultural demand in Eastern Europe, driven by current geopolitical events.

穩健的有機成長、國防專案的時機把握以及收購帶來的貢獻，促成了航空航太與國防業務的大幅成長與績效。醫療業務的成長得益於醫療移動市場的成長，而商用汽車、動力運動汽車和卡車的需求抵消了當前地緣政治事件導致的東歐農業需求疲軟，汽車市場收入在過去12個月中略有成長。

As highlighted on Slide 6, our second quarter gross margin was 31.3%, down 110 basis points from the prior year period. Higher volume was more than offset by unfavorable mix and remaining global supply chain disruptions. Consistent with our stated objectives, you can see the progress we are making by executing our strategy in the annualized chart on the right of Slide 6.

如投影片6所示，我們第二季的毛利率為31.3%，較去年同期下降了110個基點。銷售量的成長被不利的產品組合和全球供應鏈持續中斷所抵消。正如我們既定的目標一樣，您可以在投影片6右側的年化圖表中看到我們透過執行策略所取得的進展。

Moving on to Slide 7. You can see the results of our strong revenue growth and the leverage inherent in our operations as second quarter operating income increased 60% to a record $12 million or 8.2% of sales, which was up 210 basis points. Operating costs and expenses as a percent of revenue were 23.2%, down 310 basis points.

請繼續看第7張投影片。您可以看到我們強勁的營收成長和營運中固有的槓桿效應帶來的成果，第二季營業收入成長了60%，達到創紀錄的1,200萬美元，佔銷售額的8.2%，上升了210個基點。營業成本和費用佔收入的百分比為23.2%，下降了310個基點。

On Slide 8, we present GAAP net income and adjusted net income, along with our adjusted EBITDA results. Our net income and fully diluted EPS have been adjusted for certain items, which we believe provides a better understanding of our earnings power, inclusive of adjusting for the noncash amortization of intangible assets, which reflects the company's strategy to grow through acquisitions as well as organically.

幻燈片8展示了我們根據GAAP計算的淨利潤和調整後淨利潤，以及調整後的EBITDA結果。我們的淨利潤和完全稀釋每股收益已根據某些項目進行了調整，我們認為這有助於更好地理解我們的盈利能力，其中包括根據無形資產的非現金攤銷進行的調整，這反映了公司通過收購和有機增長的戰略。

Net income increased 48% to $6.8 million or $0.42 per diluted share. And on an adjusted basis, net income was $9.5 million or $0.58 per diluted share, up 21%. The effective tax rate was 23.9% in the quarter due to discrete tax benefits and geographic mix. We adjusted our expected income tax rate for the full year 2023 down slightly to be approximately 24% to 26%. Adjusted EBITDA increased 26% to $20.4 million or 13.9% of revenue, which was up 70 basis points from the second quarter of 2022. We use adjusted EBITDA as an internal metric and believe it is useful in determining our progress and operating performance.

淨利成長48%，至680萬美元，即每股攤薄收益0.42美元。經調整後，淨利成長21%，至950萬美元，即每股攤薄收益0.58美元。由於分項稅收優惠和地理分佈，本季有效稅率為23.9%。我們略微下調了2023年全年預期所得稅率，約24%至26%。調整後EBITDA成長26%，至2,040萬美元，佔營收的13.9%，較2022年第二季上升了70個基點。我們將調整後EBITDA作為內部指標，並認為有助於確定我們的進度和營運績效。

Slides 9 and 10 provide an overview of our balance sheet and cash flow. As a reminder, in the first quarter, we made a $6.25 million deferred cash payment for our prior acquisition, which was reflected in our cash position at the end of the second quarter. Total debt was approximately $228 million, down $8.3 million from year-end 2022. Debt net of cash was about $203 million or 46.2% of net debt to capitalization. Our bank leverage ratio was 3.06x. We generated $17.3 million of cash from operations year-to-date, a significant increase from cash usage during the prior year period. The increase reflects higher net income and improved working capital due to stronger inventory turns.

第9頁和第10頁概述了我們的資產負債表和現金流。需要提醒的是，在第一季度，我們為先前的收購支付了625萬美元的遞延現金，這已反映在我們第二季末的現金狀況。總債務約2.28億美元，較2022年末減少了830萬美元。扣除現金後的債務約2.03億美元，佔淨債務與資本總額的46.2%。我們的銀行槓桿率為3.06倍。年初至今，我們從營運中產生了1,730萬美元的現金，較去年同期的現金使用量大幅增加。這一增長反映了淨收入的增加以及由於庫存週轉率的提高而帶來的營運資金的改善。

Based on our cash flow projections, we expect to continue to drive strong cash flow this year consistent with historical trends. Year-to-date, capital expenditures were $6.1 million and were largely focused on new customer projects due to project timing, we adjusted our 2023 CapEx expectations to now range between $16 million and $20 million, down from $18 million to $23 million. Inventory turns improved to 3.3x in the second quarter compared with under 3x last year. Our DSO was stable at 55 days, largely reflecting timing and mix of customers.

根據我們的現金流預測，我們預計今年的現金流將繼續保持強勁，與歷史趨勢一致。年初至今，資本支出為610萬美元，由於專案時間安排，主要集中在新客戶專案。我們調整了2023年的資本支出預期，目前介於1,600萬美元至2,000萬美元之間，低於1,800萬美元至2,300萬美元。第二季庫存週轉率提升至3.3倍，去年同期不到3倍。我們的待售庫存週轉天數穩定在55天，這主要反映了客戶的時間和客戶組合。

With that, I'll now turn the call back over to Dick.

說完這些，我現在將電話轉回給迪克。

Thank you, Mike. Turning to Slide 11 shows that our orders and backlog levels in the second quarter, orders of approximately $137 million resulted in a book-to-bill ratio of 0.9x and a backlog of nearly $300 million. Although there continues to be some near-term challenges with some pockets of weaknesses in Europe, we still see excellent long-term opportunities for growth and value creation across our global platform.

謝謝，麥克。第11張投影片顯示，我們第二季的訂單和積壓訂單水準約為1.37億美元，訂單出貨比為0.9倍，積壓訂單接近3億美元。儘管歐洲市場仍存在一些短期挑戰和薄弱環節，但我們仍然看到全球平台擁有絕佳的長期成長和價值創造機會。

Our backlog decreased 3% from the sequential first quarter of 2023, reflecting the continued improvements in the supply chain as we reduce our lead times and accelerate shipments of several long lead products. As we mentioned last quarter, we expect our backlog to decline slightly over the coming quarters as our book-to-bill ratio drops below 1. The time to convert the majority of backlog to sales is within the next 9 months.

我們的積壓訂單環比2023年第一季下降了3%，這反映出隨著我們縮短交貨週期並加快部分長交貨週期產品的出貨速度，供應鏈狀況持續改善。正如我們上季度所提到的，隨著訂單出貨比降至1以下，我們預計未來幾季積壓訂單將略有下降。大部分積壓訂單轉換為銷售額的時間將在未來9個月內。

Turning to Slide 12. Demand is expected to continue at relatively strong levels within our industrial markets, which should continue to benefit from our increased market presence around industrial automation, material handling and power quality solutions. On the defense side, we are experiencing a significant increase inquiries with the ability to leverage our comprehensive product portfolio to develop solutions for several new and emerging applications.

翻到第12張投影片。預計我們工業市場的需求將保持相對強勁的水平，這將繼續受益於我們在工業自動化、物料搬運和電能品質解決方案領域不斷提升的市場份額。在國防領域，我們收到的諮詢量顯著增加，我們能夠利用我們全面的產品組合，為多種新興應用開發解決方案。

Our medical markets have returned to a more normalized sales environment focused on surgical and instrumentation-related end markets. And lastly, we are still anticipating modest growth within our vehicle markets as the supply chain continues to improve and demand schedules from our customers ramp up this year and beyond.

我們的醫療市場已恢復到更正常的銷售環境，專注於外科和儀器相關的終端市場。最後，隨著供應鏈的持續改善以及客戶需求計劃在今年及未來不斷增加，我們仍然預計汽車市場將實現溫和成長。

As we demonstrated this quarter, driving cash conversion and paying down debt is the focus. We will continue to focus these efforts as debt reduction will support our planned M&A activities. On that note, we are actively grooming potential opportunities as we build out our M&A pipeline, a key element of our overall growth strategy. While uncertainty remains in the global markets, we have confidence that we can continue to successfully execute our proven strategy well into the future.

正如我們本季所展示的，推動現金流轉換和償還債務是我們的重點。我們將繼續專注於這些工作，因為減少債務將支持我們計劃中的併購活動。為此，我們正在積極挖掘潛在機會，同時建立併購管道，這是我們整體成長策略的關鍵要素。儘管全球市場仍存在不確定性，但我們有信心在未來繼續成功執行我們行之有效的策略。

Before we open up for Q&A, just a reminder for those of you that are interested, we will be hosting our inaugural Investor and Analyst Day at the NASDAQ on Wednesday, August 23. The event will kick off at 11:00 a.m. Eastern and will accommodate with us ringing the NASDAQ closing bell.

在我們開始問答環節之前，對於有興趣的朋友，我們想提醒一下，我們將於 8 月 23 日星期三在納斯達克舉辦首屆投資者和分析師日活動。活動將於東部時間上午 11:00 開始，屆時我們將敲響納斯達克收盤鐘。

The Investor Day will be a great opportunity for you to hear more about our company and the actions we are taking to: number one, expand our available markets; two, further strengthen and grow our market share; three, leverage our global manufacturing and engineering capabilities to ensure we achieve our goals and objectives. And last but not least, help you gain a better understanding of how we plan to leverage our success in the past and continue to execute our proven process well into the future.

投資者日將為您提供一個絕佳的機會，讓您進一步了解我們的公司以及我們正在採取的行動：第一，拓展我們的可用市場；第二，進一步鞏固和提升我們的市場份額；第三，利用我們的全球製造和工程能力，確保我們實現目標。最後，同樣重要的是，它能幫助您更了解我們如何運用過去的成功經驗，並在未來繼續執行我們行之有效的流程。

Please visit our Investor Relations website for more details on the event. With that, operator, let's open the line for questions.

請造訪我們的投資者關係網站，以了解更多活動詳情。接線員，現在開始問答環節。

(Operator Instructions) And the first question will come from Greg Palm with Craig-Hallum Capital Group.

（操作員指示）第一個問題來自 Craig-Hallum Capital Group 的 Greg Palm。

Sorry to hear the news about Dick. So condolence is his family and all of you. So I guess maybe we can just start by kind of just recapping what you're seeing out there. It sounds like maybe a little bit of softening in certain verticals or geographic areas. So maybe just a little bit more color on kind of real time, what you're seeing and then we can go from there.

很遺憾聽到迪克的消息。他的家人和你們所有人都深表哀悼。我想我們可以先簡單回顧一下大家目前看到的情況。聽起來某些產業或地區的情況可能會有所緩和。所以，我們先稍微詳細介紹一下即時情況，看看大家目前看到的情況，然後再繼續討論。

Sure. I would say to you that overall, I mean, we were certainly well prepared that the order intake over the last couple of years here was somewhat inflated and as the supply chain started to normalize that we would expect to see some adjustments of schedules and so forth and that probably incoming orders would decrease. We have experienced some of that. But on the other hand, I think as noted by our 20% increase in revenues, we seem to be pretty well positioned, and we are really not very concerned going into the future. What we probably will see, Greg, is that there will be some ups and downs in markets.

當然。我想說的是，總的來說，我們當然做好了充分的準備，過去幾年這裡的訂單量有些虛高，隨著供應鏈開始恢復正常，我們預計會出現一些計劃調整等等，訂單量可能會減少。我們已經經歷過一些這樣的情況。但另一方面，我認為，正如我們20%的營收成長所顯示的那樣，我們似乎已經做好了充分的準備，我們對未來真的不太擔心。格雷格，我們可能會看到的是市場會有一些波動。

I think we've covered those markets are where we see -- we have some concerns. And Mike mentioned them and some geopolitical concerns and so forth. But on the other hand, we still see some very strong opportunities here for us to continue at the levels that we've delivered here in the past. We may see less volatility quarter-to-quarter as we've diversified our portfolio more than what we had experienced in the past. But overall, I think the numbers we put up here for the quarter were quite strong and exhibited very strong growth. And as we said during the conference call, we feel confident that we can continue doing so into the future.

我想我們已經討論了那些我們看到的市場——我們有一些擔憂。麥克也提到了這些擔憂，以及一些地緣政治擔憂等等。但另一方面，我們仍然看到一些非常好的機會，讓我們能夠繼續保持過去的水平。由於我們比過去更加多元化地配置了投資組合，我們季度間的波動可能會減少。但總的來說，我認為我們本季公佈的數據相當強勁，展現了非常強勁的成長。正如我們在電話會議中所說，我們有信心在未來繼續保持這種勢頭。

And I know you've talked about some of that elevated order activity in the past quarters or past few years. Do you have a sense of what kind of inventory levels are? I mean, is that a concern at customers or some customers? Or just you feel like they're in a position where it's just more of a real-time demand thing?

我知道您談到了過去幾個季度或過去幾年訂單量增加的情況。您了解庫存水準嗎？我的意思是，這是客戶（或某些客戶）擔心的問題嗎？還是您只是覺得他們現在的情況更像是即時需求？

It varies by customer. I mean, some customers were more conservative than others and place demand for longer periods of time just to mature they were in the pipeline. And we are seeing some adjustments based upon that. But I would just say to you that we have a really excellent communication with our blanket customers, and there's some reshuffling, but it's something we would have expected, quite frankly.

因客戶而異。我的意思是，有些客戶比其他客戶更保守，他們提出的需求週期更長，只是為了讓他們的產品線成熟。我們看到一些調整是基於這種情況的。但我只想說，我們與所有客戶的溝通非常順暢，雖然有一些調整，但坦白說，這是我們預期的。

So I don't -- there's no concern on our part that business is going away or there's a major drop off into the future. We're just not seeing that. And so I would say to you that as expected, when we come out of these things, this is the normal historical trends of supply chain shortages and longer lead times and orders being entered much earlier based upon forecast, we have experienced the same thing, but I would also have to say that it's certainly not as drastic as we had seen in the past adjustments. But it's customer by customer. And really, each of them manages their business a little bit differently, and it really depends on them.

所以，我不擔心──我們並不擔心業務會消失，或是未來會大幅下滑。我們只是沒有看到這種情況。我想說，正如預期的那樣，當我們擺脫這些困境時，這屬於正常的歷史趨勢，即供應鏈短缺、交貨時間延長以及根據預測提前下單。我們也經歷過同樣的事情，但我必須說，這肯定不像我們過去調整時看到的那麼劇烈。但這因客戶而異。實際上，每個客戶的業務管理方式都略有不同，這真的取決於他們自己。

Yes. Okay. Operationally, another good quarter where you saw solid margins, good operating leverage. I know you've talked about gross margin expansion on an annual basis. I think you've targeted 100 basis points. Are you still comfortable with that in light of some of your comments on a more muted sort of demand volume outlook? Or do you still think there's ways that you can take some costs out? And I'm just curious, are you still seeing or incurring some of the elevated supply chain cost that we've been talking about over the past year or have those basically ended at this point?

是的。好的。從營運角度來看，這又是一個不錯的季度，利潤率穩健，營運槓桿也不錯。我知道您談到了年度毛利率的成長。我認為您的目標是提高100個基點。考慮到您之前對需求量前景較為溫和的一些評論，您是否仍對此感到滿意？或者您仍然認為有辦法降低一些成本？我很好奇，過去一年我們一直在討論的供應鏈成本上升，您現在是否仍然看到或承擔這些成本？或者這些成本現在基本上已經結束了？

No, I think -- okay, a couple of questions here. First off, let's -- we've stated that our goal was to increase gross margin. And I think we've come back and stated as well that you've got to consider as part of the gross margin overall operating margin. So that's really what we will focus on in the future is that the combination of gross margin and operating margin improvements will give us the 100 basis points per year, okay? So that's I think let's make sure that we take that and we're clear on that going forward.

不，我想——好的，這裡有幾個問題。首先，我們之前說過，我們的目標是提高毛利率。而且，我想我們也說過，毛利率必須包含整體營業利益率。所以我們未來真正要關注的是，毛利率和營業利益率的提升能讓我們每年提高100個基點，對吧？所以，我想，我們要確保我們能夠實現這個目標，並且在未來保持清晰的思路。

Operating margin is always a challenge based on mix. And that's what's sometimes difficult from quarter-to-quarter or year-over-year to really look at. So depending on -- and obviously, as you know, the mix of our products, based on certain markets and certain products sold, the margins will be lower and the opposite of that. I mean, we have others that are much higher gross margin based upon, I'll call it, the IP involved in the markets we're serving as well as the content that we have in those in terms of the solution set. So let's -- I think let's level set and say we are going to proceed here with meeting our commitments for 100 basis points improvement, a combination of gross margin and operating margin level, okay?

營業利潤率始終是基於產品組合的挑戰。這有時很難從季度或年度角度來衡量。所以，根據——當然，如你所知，我們的產品組合，基於特定市場和特定銷售產品，利潤率會降低，反之亦然。我的意思是，我們有一些產品的毛利率要高得多，我稱之為基於我們所服務市場所涉及的智慧財產權以及我們在這些市場中擁有的解決方案內容。所以，我想，讓我們設定一個水平，假設我們將繼續履行承諾，將毛利率和營業利潤率水平提高100個基點，好嗎？

The next question will come from Ted Jackson with Northlink Securities (sic) [Northland Securities].

下一個問題來自 Northlink Securities（原文如此）[Northland Securities] 的 Ted Jackson。

Congrats, had a very solid quarter, guys. So a couple of questions. One, just because following up on the prior kind of Q&A commentary. I understand supply chains normalizing out and some, call it, floating around if you would, with regards to orders and shipments. But you also feel pretty confident that you're going to be able to continue to show growth on an organic basis in the second half of the year. Is that what I picked up from all that dialogue?

恭喜，各位，這個季度業績非常穩健。所以有幾個問題。第一，為了跟進先前的問答環節，我理解供應鏈正在恢復正常，有些訂單和出貨量也處於不穩定狀態。但您也非常有信心，下半年能夠持續保持自然成長。這是我從剛才的對話中了解到的訊息嗎？

Yes. I mean I think from an organic growth standpoint, we're certainly confident that we can continue to grow. Okay. What was the comment that I just I think I want to clarify is that in the past, you would see more seasonality in our business quarter-over-quarter. And based on what we're seeing and based on backlog that had some items that sit in there waiting for supply chain to free up and ship, I think we're saying -- we're seeing more of a normalized quarter-over-quarter shipment rate, and then we see that going forward.

是的。我的意思是，從有機成長的角度來看，我們當然有信心能夠繼續成長。好的。我想澄清的是，過去，我們業務的季節性變化會更明顯。根據我們現在的情況，以及積壓訂單（一些積壓的訂單等待供應鏈釋放並發貨），我認為我們看到的季度環比出貨率更加正常化，並且我們預計未來也會如此。

Now fourth quarter, we'll let you know as we get closer because that's always been a crapshoot for us in the past and based upon what happens with our customers. But really, what we're seeing is more stability and less cyclical shipments in quarter-over-quarter. Europe has a tendency to be lower in Q3. Many countries shut down for multiple weeks in August. So that's July and August, so we do see some weakness there. But I guess I would say to you and to everyone else is that the expectations of the cyclicality that we saw or seasonality we saw in the past is going to be muted, okay?

現在，第四季即將到來，我們會及時告知大家，因為過去這對我們來說一直是一場賭博，而且取決於我們客戶的情況。但實際上，我們看到的是季度環比出貨量更穩定，週期性出貨量也減少了。歐洲第三季的出貨量趨於下降。許多國家在8月停擺了數週。所以這是7月和8月，我們確實看到了一些疲軟的跡象。但我想對各位以及所有人說的是，我們過去看到的周期性或季節性預期將會減弱，好嗎？

Okay. Just to kind of help clarify a little bit. With regards to backlog, if we were -- if you look in your backlog, how much of your backlog ships in third quarter?

好的。稍微澄清一下。關於積壓訂單，如果你查看一下積壓訂單，第三季有多少積壓訂單出貨？

Well, I would say to you that the -- here's the -- when we say what's in our backlog and our reported backlog because we only have in our backlog items which have firm release dates or production days. So it varies by customer. We have -- depending on the lead times that we have, so when they release, we'll call it a planned order or forecasted order to a firm production date, that's when it officially goes into our backlog, but you really don't see those. Those are pretty much book and ship within a very short period of time and pretty much wash out in the quarter. So to answer your question, for third quarter, 95% plus is in our backlog, if you would consider as well the blanket orders that will come and go within the quarter, okay? So it's pretty much locked in the third quarter at this point.

嗯，我想告訴你的是——這裡指的是——當我們說我們的待辦事項訂單和報告的待辦訂單時，因為我們的待辦訂單中只有確定了發布日期或生產日期的產品。所以它因客戶而異。這取決於我們的交貨週期，所以當它們發佈時，我們會稱之為計劃訂單或預測訂單，直到確定生產日期，那時它才正式進入我們的待辦事項訂單，但你實際上看不到這些。這些訂單幾乎在很短的時間內就被預訂和發貨，並且幾乎在本季度就被淘汰了。所以回答你的問題，對於第三季度，95%以上的訂單都在我們的待辦事項訂單中，如果你也考慮一下本季度內到貨和完成的總訂單，好嗎？所以目前來看，它基本上已經鎖定在第三季了。

Yes. The dynamic of our backlog hasn't changed, right? We have stated that it's what's in the backlog, most of it will ship within the next 6 to 9 months.

是的。我們的待辦事項動態沒有變化，對吧？我們已經聲明了，這就是待辦事項，大部分將在未來6到9個月內發貨。

Okay. And then shifting over, just out of curiosity, I know Rockwell is a distribution channel for you and they reported results earlier in the week and honestly, they had some difficult performance in the stock as well. One of the things that impacted them during that quarter and probably really the only thing was that they put this new distribution center in place and it caused a little bit of a hiccup in terms of timing with regards to some revenues. And I was curious, given your exposure to Rockwell, is there anything within that, that has played out for Allied Motion, and is there anything that we need to think about on that front?

好的。然後，出於好奇，我知道羅克韋爾是你們的一個分銷管道，他們在本週早些時候公佈了業績，說實話，他們的股票表現也不太好。那個季度對他們影響最大的一個因素，也可能是唯一的一個因素，就是他們設立了一個新的分銷中心，這導致一些收入在時間上出現了一些小問題。考慮到你們在羅克韋爾的合作，我很好奇，這對Allied Motion有什麼影響嗎？在這方面我們需要考慮什麼嗎？

Not really.

並不真地。

Okay. And then, Dick, the last -- well, probably maybe 3 press releases. It's been pretty consistent with regards to discussion about Europe and certain kind of softness in pockets of it, if you would. With regards to this current quarter, is there any kind of relative shift with regard to that weakness relative to, say, first quarter? Or is it just a continuation of kind of the same kind of generalized believe, if you would, that's affected the reason because of the Ukraine war?

好的。迪克，最後，大概是三篇新聞稿。關於歐洲經濟以及歐洲某些領域疲軟的討論一直相當一致，如果您願意的話。就本季而言，這種疲軟態勢與第一季相比是否有任何相對變化？或者，這只是某種普遍看法的延續，如果您願意的話，這種看法是由於烏克蘭戰爭的影響？

Yes. What I would say to you is this, is that surprisingly, the booking -- the bookings in the quarters 1 and 2 and so forth. And based upon we had expected some in Europe, some impact on it and so forth. And we really weren't seeing that to a great magnitude. We have seen some additional softness in the booking levels, but there's still strong backlogs to work off them. So energy prices, the Ukraine war, I think, are still impacting and you've got -- but the reality is the bookings have remained strong. Orders were placed. There has been a little bit of softness here in the last few months that we've noticed. But again, too, it's holiday season in Europe. So that's a hard one to predict.

是的。我想說的是，令人驚訝的是，第一季和第二季的訂單量有所下降。根據我們先前對歐洲的訂單量預期，歐洲的訂單量會受到一定影響等等。但我們實際上並沒有看到很大的變化。我們看到訂單量有所下降，但仍有大量積壓訂單需要消化。能源價格和烏克蘭戰爭等因素仍在影響，但事實上，訂單量依然強勁。訂單量有所增加。我們注意到過去幾個月歐洲的訂單量略有下降。不過，現在正值歐洲的假期季，所以很難預測。

Yes. You're not the only one that has that problem. My last question is just on the vehicle business. You commented on the commercial vehicle business and the strength you're seeing within there, and it's offset some of the ag side of things, which clearly is from the small ag equipment market. But in the commercial vehicle side of the equation, there's clearly been some, call it, forward demand pull-through because of emission rule changes and stuff. Given that market dynamic, how do you see that part of your vehicle business performing as we roll out of '23 and into '24? And maybe you could give a little color with regards to the exposure within that line item that the commercial vehicle market is relative to the aggregate?

是的。您不是唯一遇到這個問題的人。我的最後一個問題是關於汽車業務的。您談到了商用車業務以及您看到的商用車業務的強勁表現，這抵消了農業業務的一些影響，而農業業務的負面影響顯然來自小型農業設備市場。但在商用車方面，由於排放規則的變化等因素，顯然存在一些所謂的「前向需求拉動」。鑑於這種市場動態，您如何看待在2023年和2024年期間，您認為商用車業務在汽車業務中的表現？能否稍微解釋一下商用車市場在整體市場中所佔的比例？

Sure. Well, we're not going into specifics about what the percentage of sales overall, we talk about overall vehicle market, I would say to you that the impact on us for commercial automotive is not very significant, okay? We have seen increase. We have seen the volume and the demand going up. Where we talk about the offset, which I'll say it is a much greater magnitude, which will mute some of that growth. It is in the agriculture equipment and programs that we are working on with our OEMs in Eastern Europe, which are essentially shut down.

當然。我們不會具體討論整體銷售佔比，我們討論的是整個汽車市場。我想說的是，商用車市場對我們的影響並不大，對吧？我們看到了成長。我們看到銷量和需求都在上升。至於抵銷效應，我認為它的幅度要大得多，這會抑制部分成長。抵銷效應體現在我們正在與東歐原始設備製造商合作的農業設備和專案上，這些專案目前基本上處於停工狀態。

So until that has a greater impact on us in the reduction on the level of shipments there versus commercial automotive ramp-up. So we would gladly substitute and swap those to and see that demand for the agricultural equipment and construction equipment and so forth, that impact in Eastern Europe go back to what the expected levels were and have a, let's say, a slower growth in automotive, we would be perfectly happy with that. And the impact would be when we talk about mix and so forth in margins, that would definitely have a positive impact favorable to the company.

因此，除非商用汽車出貨量的成長對我們造成更大的影響，導致出貨量下降。因此，我們很樂意進行替換，並看到東歐對農業設備和建築設備等的需求回到預期水平，而汽車行業的成長速度有所放緩，我們會非常樂意接受。而當我們談到利潤率等產品組合時，這肯定會對公司產生正面的影響。

So I would just say to you that these are the diversification of the company is what's really our strength. And while some markets are experiencing a little softness, our other markets are growing. And that is our intention to continue to do that in the future. And we've always said that we like the benefits of the commercial automotive market and that the core unit volume, the discipline it teaches you in the 0 defect mentality and the positive impacts on overall cost and other areas that, that can bring. We also don't want to be overweighted in that area that it's do enough to realize those benefits, but let's make sure that we don't get over weighted, okay?

所以我想說，公司的多元化正是我們真正的優勢。雖然有些市場略顯疲軟，但我們的其他市場卻在成長。我們打算在未來繼續保持這種勢頭。我們一直說，我們看好商用汽車市場的優勢，包括核心銷售、它所教導的「零缺陷」概念，以及它對整體成本和其他方面可能帶來的正面影響。我們也不想在這個領域投入過多，因為我們已經足夠努力來實現這些優勢了，但我們必須確保不要投入過多，好嗎？

So I hope that helps you understand it. It's -- to answer your question, we have seen an increase. And I think we'll continue to see increases. But the offset is more powerful than the increase that we see in that market.

所以我希望這能幫助你理解。回答你的問題，我們已經看到了成長。而且我認為我們還會繼續看到成長。但抵銷效應比我們在那個市場看到的成長更為強勁。

And the income is coming from the new programs that we have been discussing for the last couple of years.

收入來自於我們過去幾年一直在討論的新項目。

Correct. Yes, they're coming.

正確。是的，他們來了。

(Operator Instructions) Our next question will come from Brett Kearney with Gabelli Funds.

（操作員指示）我們的下一個問題來自 Gabelli Funds 的 Brett Kearney。

I was going to follow up on the vehicle, new program awards. You kind of covered it some in your prepared remarks and in the discussion right there. But just on whether those program launches are still kind of on the original timetables. And maybe if you could remind us kind of the ramp schedules there? And then also, the customers and products you're supporting there on some of the new programs seem to be that product set seems to be growing nicely globally. Maybe opportunities if you guys perform there as you have done historically longer term with some of these customer relationships you've developed?

我本來想跟進一下車輛和新項目獎項的問題。您在準備好的發言和剛才的討論中已經提到了一些。但我想問一下這些項目的發布是否仍按照原計劃進行。您能否提醒我們那裡的產能提升計畫？另外，您支持的一些新專案的客戶和產品似乎在全球範圍內成長良好。如果你們能像以往一樣長期與客戶建立關係，或許會為你們帶來機會？

Yes. I mean, those programs are all delayed through COVID. And so they definitely were pushed. And I would tell you that we look at the original forecast that we were provided for programs and, let's say, without COVID, and without supply chain we're probably 2 years behind. So nothing has changed in terms of what we expect our annual revenue base to be in that area. Programs are moving forward. It's just a matter that they were pushed out and the ramp-up was delayed, but it's clearly ramping up, okay? So I would tell you that in next year, we'll be at what we stated for the new program shipment levels will be at full level of what we've stated, okay? So they are moving forward, and they're moving forward nicely.

是的。我的意思是，這些項目都因為新冠疫情而被推遲了。所以它們肯定是被推遲了。我想告訴你，我們查看了最初提供給我們的專案的預測，假設沒有新冠疫情和供應鏈，我們可能落後了兩年。所以，就我們預期的該領域的年收入基數而言，沒有任何變化。項目正在推進。只是它們被推遲了，產能提升被推遲了，但顯然是在加速，對吧？所以我想告訴你，明年，我們的新項目出貨量將達到我們先前承諾的水平，對吧？所以，它們正在推進，而且進展順利。

Excellent. Okay. And then I think just last one, we've covered the topic of destocking across the industrial channel. Maybe we've heard from some folks that there's some inventory adjustments taking place on the medical OEM side. It seems like the applications you guys are on there kind of insulate you, but maybe what you're seeing positives and negatives on the medical side of the business?

非常好。好的。我想最後，我們剛剛討論了工業通路去庫存的問題。我們可能會聽一些人說，醫療OEM廠商正在進行一些庫存調整。看起來你們在這方面的應用在某種程度上起到了一定的保護作用，但你們在醫療業務方面看到了哪些積極和消極的方面？

Yes. I mean, I would tell you that, that's one that has been -- of course, you go back to the COVID time and you take a look at what the products were shipping during COVID and those that were not shipping. And we've said here, I think within the last -- in the past year or 1.5 years, they kind of normalize back to, we'll call it, a normal period of time, a non-COVID period of time. We're -- so our instrumentation and our surgical equipment and all the other surgical equipment that goes on when I say surgical, including oncology and surgical robotics and other surgical. I mean, they're tracking nicely.

是的。我的意思是，我想告訴你，這確實是一個……當然，回顧新冠疫情時期，你會看到哪些產品在疫情期間發貨，哪些沒有發貨。我們之前說過，我認為在過去一年或一年半的時間裡，它們已經恢復正常，我們稱之為正常時期，非疫情時期。我們的儀器、手術設備以及所有其他手術設備，包括腫瘤科、手術機器人和其他手術設備，都在穩步推進。我的意思是，它們都在穩定地推進。

So we're up 3% overall year-over-year. And I would say to you that there may be some correction going on and maybe the growth rate should be higher. It's certainly a drag on our overall growth rate that we've seen for the company than in some other areas. But on the other hand, it's been stable. And I think it's pretty steady. It's probably -- if there's restocking, we're not really seeing it, all right? So I don't know where that's occurring, but we're not seeing it.

所以，我們整體年增了3%。我想說的是，可能正在經歷一些調整，成長率可能應該更高。這肯定會拖累我們公司的整體成長率，我們看到公司整體成長率比其他一些領域更高。但另一方面，我們的業績一直很穩定。我認為相當穩定。可能——如果有補貨，我們並沒有真正看到，對吧？所以我不知道這種情況發生在哪裡，但我們確實沒有看到。

This concludes our question-and-answer session. I would like to turn the conference back over to management for any closing remarks. Please go ahead.

我們的問答環節到此結束。我想將會議交還給管理階層，請大家發表結束語。請大家發言。

Well, thank you, everyone, for joining us on today's call and for your interest in Allied Motion. As always, please feel free to reach out at any time, and we look forward to talking with all of you again after our third quarter 2023 results. In addition to the Investor Day at Nasdaq, please join us at the Northland Capital Markets Conference on September 19 in Minneapolis.

好的，感謝大家參加今天的電話會議，也感謝大家對Allied Motion的關注。一如既往，歡迎隨時聯絡我們，我們期待在2023年第三季業績公佈後再次與大家交流。除了納斯達克的投資者日活動外，也歡迎大家參加9月19日在明尼阿波利斯舉行的北國資本市場會議。

Thank you for your participation, and have a great day.

感謝您的參與，祝您有個愉快的一天。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您可以斷開連線了。