AeroVironment, Inc. (AVAV) 2016 Q3 法說會逐字稿

Good day, ladies and gentlemen. Welcome to AeroVironment, Incorporated third-quarter fiscal 2016 earnings call.

各位女士、先生，大家好。歡迎參加 AeroVironment, Incorporated 2016 會計年度第三季財報電話會議。

(Operator Instructions)

（接線員指示）

As a reminder, this conference call is being recorded for replay purposes.

提醒各位，本次電話會議將錄音，以供日後重播。

With us today from the Company is the Chairman and Chief Executive Officer, Mr. Tim Conver; President and Chief Operating Officer, Mr. Wahid Nawabi; Senior Vice President and Chief Financial Officer, Mr. Raymond Cook; and Vice President of Investor Relations, Mr. Steven Gitlin.

今天與會的公司代表包括：董事長兼執行長 Tim Conver 先生；總裁兼營運長 Wahid Nawabi 先生；資深副總裁兼財務長 Raymond Cook 先生；以及投資人關係副總裁 Steven Gitlin 先生。

And now at this time, I would like to turn the conference over to Mr. Gitlin. Please go ahead, sir.

現在，我想將會議交給 Gitlin 先生。先生，請開始。

Thank you, Bridget. Welcome to our third-quarter fiscal 2016 earnings call.

謝謝你，Bridget。歡迎參加我們 2016 會計年度第三季財報電話會議。

Please note that on this call, certain information presented contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations, forecasts and assumptions that involve risks and uncertainties, including but not limited to economic, competitive, governmental and technological factors outside of our control that may cause our business strategy or actual results to differ materially from the forward-looking statements.

請注意，本次電話會議中所呈現的部分資訊包含《1995 年私人證券訴訟改革法》所定義的前瞻性陳述。前瞻性陳述係基於目前的預期、預測與假設，並涉及風險與不確定性，包括但不限於我們無法控制的經濟、競爭、政府及技術因素，這些因素可能導致我們的業務策略或實際結果與前瞻性陳述存在重大差異。

For a list and description of such risks and uncertainties, see the reports we file with the Securities and Exchange Commission. Investors are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date on which they are made. We do not intend and undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

關於此類風險與不確定性的清單及說明，請參閱我們向美國證券交易委員會提交的報告。投資人請勿過度依賴任何前瞻性陳述；該等陳述僅截至其作成之日有效。我們無意且不承擔任何義務因新資訊、未來事件或其他原因更新任何前瞻性陳述。

The content of this conference call contains time-sensitive information that is accurate only as of today, March 8, 2016. The Company undertakes no obligation to make any revision to the statements contained in our remarks or to update them to reflect events or circumstances occurring after this conference call.

本次電話會議內容包含具時效性的資訊，僅在今日（2016 年 3 月 8 日）為止為準確。公司不承擔對我們發言中所含陳述作任何修訂，或更新以反映本次電話會議後發生之事件或情況的義務。

We will begin with remarks from Tim Conver. Tim?

我們將先由 Tim Conver 發表談話。Tim？

Thank you Steve and welcome to our third-quarter fiscal 2016 conference call.

謝謝你，Steve，也歡迎各位參加我們 2016 會計年度第三季電話會議。

Our fiscal 2016 third quarter was in line with our expectations. Third-quarter revenue of $67.6 million increased year-to-date revenue to $179.9 million, and a favorable product mix kept third-quarter gross margin strong at 39.4%.

我們 2016 會計年度第三季的表現符合預期。第三季營收為 6,760 萬美元，使年初至今營收增加至 1.799 億美元；而有利的產品組合使第三季毛利率維持強勁，達 39.4%。

Taking a broad view of the quarter and the year, we think there are some key points to note from today's call. First, our core business of small UAS and EES remains strong and profitable, with leading market positions, growth opportunities and solid customer relationships.

從更宏觀的角度看本季與本年度，我們認為今天的電話會議有幾個重點值得注意。第一，我們的小型 UAS 與 EES 核心業務仍然強勁且具獲利能力，擁有領先的市場地位、成長機會以及穩固的客戶關係。

Second, we believe that the incremental investments in research and development and SG&A will position AeroVironment for growth opportunities, we expect to deliver long-term value creation and significant ROI. And third, if we did not believe that these significant incremental investments would provide the highest ROI opportunity, we could reduce and eliminate or eliminate them for the corresponding increase in operating earnings that the core business is otherwise generating.

第二，我們相信在研發以及 SG&A（銷售、一般及行政費用）方面的增量投資，將使 AeroVironment 能把握成長機會；我們預期可帶來長期價值創造與顯著的投資報酬率（ROI）。第三，若我們不相信這些重大的增量投資能提供最高的 ROI 機會，我們本可削減或取消這些投資，從而使核心業務原本所創造的營業利益相應增加。

On today's call, I will provide an overview of Q3 and year-to-date financial performance. Our President and COO Wahid Nawabi will review the Q3 highlights in our core business, which includes small UAS and EES as well as the substantial progress we are making across our growth portfolio. Our CFO Raymond Cook will follow Wahid with the review of Q3 and year-to-date financial performance, after which I will update our view on the remainder of fiscal 2016.

在今天的電話會議中，我將概述第三季及年初至今的財務表現。我們的總裁兼營運長 Wahid Nawabi 將回顧核心業務（包括小型 UAS 與 EES）的第三季重點，以及我們在成長型產品組合上取得的重大進展。接著，我們的財務長 Raymond Cook 將回顧第三季及年初至今的財務表現，之後我將更新我們對 2016 會計年度剩餘期間的看法。

Year-to-date revenue increased by 4%, and gross margin increased by 26% from fiscal 2015 to fiscal 2016. Third-quarter UAS revenue increased $3 million year over year, while company revenue and gross profit for the quarter were about 1% lower.

年初至今營收成長 4%，毛利較 2015 會計年度至 2016 會計年度增加 26%。第三季 UAS 營收年增 300 萬美元，而公司第三季營收與毛利約較去年同期低 1%。

Operating profit year to date has increased by more than 150% year over year. Year-to-date gross margin is growing faster than revenue, with some effects from mix and reserves.

年初至今營業利益年增超過 150%。年初至今毛利率成長快於營收，部分受到產品組合與備抵（提列）影響。

These year-to-date results do not reflect the high levels of research and development and marketing planned for Q4. We anticipate that high Q4 investments could still offset most or all of the operating profit or the full fiscal year 2016. Even though we are building inventory in anticipation of high Q4 deliveries and continuing to invest strategically in research and development opportunities, we are maintaining our operating management discipline as demonstrated by our Q3 free cash flow of $15.7 million.

這些年初至今的結果尚未反映我們在第四季規劃的高水準研發與行銷支出。我們預期第四季的高額投資仍可能抵銷 2016 會計年度全年的大部分或全部營業利益。儘管我們正為預期第四季的大量交付而建立庫存，並持續在研發機會上進行策略性投資，我們仍維持營運管理紀律，第三季自由現金流為 1,570 萬美元即為明證。

As we move to the fourth quarter, our primary focus continues to be supporting and anticipating the needs of our customers and executing effectively in our core businesses. At the same time, we remain committed to incremental investments to enhance stockholder value in the long term.

邁入第四季，我們的首要重點仍是支援並預先掌握客戶需求，並在核心業務中有效執行。同時，我們仍致力於進行增量投資，以在長期提升股東價值。

These investments include development of a new growth opportunity in commercial UAS, a market expected to generate significant value across multiple large global industries. Commercial UAS represents a compelling new market opportunity where we believe our prudent and targeted investments can enable us to establish a strong position by being the first to develop and deliver the right system solution.

這些投資包括在商用 UAS 領域開發新的成長機會；該市場預期將在多個大型全球產業中創造顯著價值。商用 UAS 是一個極具吸引力的新市場機會；我們相信，透過審慎且聚焦的投資，我們可藉由率先開發並交付正確的系統解決方案，建立強勢地位。

With that, I will turn the call over to Wahid for his review of Q3 highlights in our core business and our growth portfolio. Wahid?

接下來，我將把電話會議交給 Wahid，由他回顧核心業務與成長型產品組合的第三季重點。Wahid？

Thanks Tim.

謝謝你，Tim。

Before I review the quarter's highlights, I'd like to take a moment to express my enthusiasm in helping to fulfill the potential of this amazing organization as AeroVironment's President and COO.

在我回顧本季重點之前，我想先花點時間表達我對於以 AeroVironment 總裁兼營運長的身分，協助實現這個卓越組織潛力的熱忱。

I'm most excited about the outstanding AeroVironment team and what we can achieve together. In my various roles at the Company from leading our EES business segment to establishing an integrated functional organization, to working closely with our UAS team, I have enjoyed broad exposure to our people, customers and our solutions.

我最感到振奮的是 AeroVironment 優秀的團隊，以及我們能共同達成的成果。從我在公司擔任的各種職務——從領導 EES 事業部、建立整合的職能型組織，到與 UAS 團隊密切合作——我有機會廣泛接觸我們的員工、客戶與解決方案。

Throughout my experience here, I have continually been impressed by the intelligence and passion of our teammates. We are in the business of developing and delivering innovative technology solutions that help our customers accomplish their missions whether on the battlefield or in the marketplace.

在我於此的經驗中，我持續對同仁的智慧與熱情印象深刻。我們的業務是開發並交付創新技術解決方案，協助客戶完成其任務，無論是在戰場上或在市場中。

I am certain that our team will continue to work hard to create value for our customers and our stockholders. I look forward to spending more time with our stockholders and analysts, communicating our strategy and the exciting opportunities that lie ahead for AeroVironment.

我確信我們的團隊將持續努力，為客戶與股東創造價值。我期待能花更多時間與股東及分析師交流，傳達我們的策略，以及 AeroVironment 未來令人振奮的機會。

Now on to our Q3 highlights beginning with our EES business segment, our North America Level 2 charge dock deployment footprint for [on-load] electric vehicles which includes auto dealerships, residences and other businesses, surpassed 31,000 units at the end of third quarter. That number includes more than 200 of our new TurboDock system, which are designed for access controlled workplace charging and for which demand appears to be growing.

接著談第三季重點，先從我們的 EES 事業部開始：截至第三季末，我們在北美的 Level 2 充電座部署規模（用於 [on-load] 電動車，涵蓋汽車經銷商、住宅及其他企業）已超過 31,000 台。該數字包含 200 多台我們新的 TurboDock 系統，其設計用於具門禁控管的職場充電，且需求似乎正在成長。

In industrial electric vehicle charging systems, early in Q4, we introduced our new PosiCharge ProCore, a premium intelligent family of scalable charging systems. We believe PosiCharge ProCore, the first smartphone configurable charger for industrial EVs, will help us to further our penetration of the industrial charging market and increase EES revenue in coming years. This is another indication of our ongoing market leadership and commitment to developing innovative solutions that allow our customers to move forward with confidence while also expanding the adoption of electric vehicles.

在工業用電動車充電系統方面，我們於第四季初推出全新的 PosiCharge ProCore——一個高階、智慧且可擴充的充電系統系列。我們相信 PosiCharge ProCore 作為首款可透過智慧型手機設定的工業用 EV 充電器，將有助於我們進一步提升在工業充電市場的滲透率，並在未來幾年增加 EES 營收。這也再次顯示我們持續的市場領導地位，以及致力於開發創新解決方案的承諾，讓客戶能更有信心地向前邁進，同時擴大電動車的採用。

Now let's look at our UAS business, which continued its solid performance in the quarter with revenue of $61 million in the third quarter, an increase of 5% over the prior year. AeroVironment benefits from the leading market position for small UAS and defense applications, with the largest share within the US Department of Defense and a growing international footprint.

接著看看我們的 UAS 業務，本季持續穩健表現，第三季營收為 6,100 萬美元，較去年同期成長 5%。AeroVironment 受惠於小型 UAS 與國防應用的領先市場地位，在美國國防部擁有最大的市占率，且國際布局持續擴大。

In third quarter, we received a $13 million Puma all environment order from the US Marine Corps, which demonstrates the important role that our small UAS continue to play in keeping troops safe and helping them become even more effective. Similarly, our track record of winning more than 90% of the task order revenue year-to-date from the US Army small UAS IDIQ contract competing against four other companies supports our leading position in this key market.

第三季，我們獲得美國海軍陸戰隊 1,300 萬美元的 Puma 全環境機型訂單，顯示我們的小型 UAS 持續在確保部隊安全並提升其作戰效能方面扮演重要角色。同樣地，我們在美國陸軍小型 UAS IDIQ 合約中，年初至今在與另外四家公司競爭下贏得超過 90% 的任務訂單營收，亦支持我們在此關鍵市場的領先地位。

Our customer base continues to grow internationally, and we see strong adoption signals from maritime customers based on our all environment and autonomous landing Puma AE systems. Puma AE systems can operate for nearly four hours per flight and land themselves into portable nets that do not require modifying ship decks, an important capability for maritime adoption and a competitive advantage for our Company. They also provide organic ISR for critical missions from ships of all sizes and purposes.

我們的客戶基礎持續在國際間成長，並且我們從海事客戶端看見基於我們全環境與自主降落的 Puma AE 系統所展現的強勁採用訊號。Puma AE 系統每次飛行可運作近四小時，並可自行降落至可攜式網具中，且不需要改裝船舶甲板；這項能力對海事採用至關重要，也是本公司的競爭優勢。它們亦可為各種尺寸與用途的船舶在關鍵任務中提供有機 ISR（情監偵）。

In December, we deployed an AeroVironment crew with a Puma AE system onboard the US Coast Guard icebreaker Polar Star. During its Antarctic mission, as part of Operation Deep Freeze, our Puma AE system flew more than 25 miles from the ship in the harsh Antarctic environment on one of its multiple scouting flights. This is a great example of the professional differentiation of our small UAS from consumer and most commercial drones that can only operate in ideal weather conditions.

12 月，我們在美國海岸防衛隊破冰船 Polar Star 上部署了一支搭載 Puma AE 系統的 AeroVironment 團隊。在其南極任務期間，作為「深度凍結行動」（Operation Deep Freeze）的一部分，我們的 Puma AE 系統在嚴苛的南極環境中，於多次偵察飛行中的其中一次，從船上飛行超過 25 英里。這是我們小型無人機系統（UAS）相較於消費級以及多數僅能在理想天候條件下運作的商用無人機之專業差異化的絕佳例證。

This year, we continue to make significant progress positioning ourselves to grow into the maritime small UAS market, and Puma AE's capabilities supported maritime operations with demonstrations, new orders and greater interest in this unique capability. We are confident that these competitive advantages will contribute to our growth.

今年，我們在布局海事小型 UAS 市場以推動成長方面持續取得重大進展，而 Puma AE 的能力透過展示、取得新訂單以及市場對此獨特能力的更高興趣，支援了海事作業。我們有信心，這些競爭優勢將有助於我們的成長。

The international market for small UAS has demonstrated strong potential this year. Fiscal year to date, AeroVironment added four new allied customers to the more than 30 allies who have procured our small UAS solutions, and three of these new customers took initial delivery in the third quarter. Third-quarter international small UAS revenue increased by more than 80% year over year, with foreign military sales accounting for 50% of that revenue and direct commercial sales constituting the balance.

今年小型 UAS 的國際市場展現出強勁潛力。本會計年度迄今，AeroVironment 新增 4 個盟國客戶，使採購我們小型 UAS 解決方案的盟國總數超過 30 個，其中 3 個新客戶已於第三季完成首次交付。第三季國際小型 UAS 營收年增超過 80%，其中對外軍售（FMS）占該營收的 50%，其餘則為直接商業銷售。

Our growth portfolio progressed further towards realizing its value creation potential with tactical missile systems, commercial UAS and large UAS. In tactical missile systems or TMS, our incremental R&D investment in Switchblade variants during fiscal 2015 supported customer adoption in fiscal 2016. In the same way we develop Switchblade and all of our solutions with our own initial investment followed by customer funding, demonstration and then growing adoption, we are moving the four identified Switchblade variants through our innovation process with positive results.

我們的成長型產品組合在戰術飛彈系統、商用 UAS 與大型 UAS 方面，進一步朝向實現其價值創造潛力邁進。在戰術飛彈系統（TMS）方面，我們於 2015 會計年度對 Switchblade 各型號所增加的研發投資，支持了客戶於 2016 會計年度的採用。正如我們以自有的初始投資開發 Switchblade 及所有解決方案，之後再由客戶資金支持、進行展示並逐步擴大採用，我們正以正面成果推進已識別的 4 種 Switchblade 變體，通過我們的創新流程。

We're building a family of tactical missile systems optimized for multiple customer applications with unique advantages that are common across this product family. These advantages result from AeroVironment's strong innovation and knowledge of the customer's mission and position us well to support long-term business growth.

我們正在打造一個針對多種客戶應用最佳化的戰術飛彈系統產品家族，並在此產品家族中共享若干獨特優勢。這些優勢源自 AeroVironment 強大的創新能力以及對客戶任務的深入理解，使我們具備良好定位以支持長期業務成長。

For the first time, the president's proposed budget, which was released in February, included a line item request for lethal miniature aerial missile systems also known as LMAMS. This is a significant customer development that potentially supports greater tactical missile systems visibility through a defined budget line item with associated documentation and multi-year customer procurement planning.

總統於 2 月公布的預算提案首次納入一項針對致命微型空中飛彈系統（lethal miniature aerial missile systems），亦稱 LMAMS 的預算科目請求。這是重大的客戶端發展，透過明確的預算科目及其相關文件與多年期客戶採購規劃，可能提升戰術飛彈系統的能見度。

This is also a positive indicator of the US Army's favorable experience with AeroVironment Switchblade system that bodes well for the Army's longer-term adoption of LMAMS. There is a broad set of opportunities for our tactical missile systems, and we're making significant progress towards realizing them.

這也正面顯示美國陸軍對 AeroVironment Switchblade 系統的良好使用經驗，並預示陸軍在較長期採用 LMAMS 方面的前景。我們的戰術飛彈系統擁有廣泛的機會，我們正朝實現這些機會取得重大進展。

Shifting now to the growth opportunity in our large UAS business, we continue to focus on business development activities to introduce atmospheric satellites that can provide greater capability and lower cost to government and commercial customers across the globe. With this initiative in its early stages, we continue our optimistic dialogue with interested parties.

接著談到我們大型 UAS 業務的成長機會，我們持續聚焦於業務開發活動，以向全球政府與商業客戶導入可提供更高能力且成本更低的「大氣衛星」（atmospheric satellites）。由於此項計畫仍處於早期階段，我們持續與有興趣的各方進行樂觀的對話。

In commercial UAS, we're dedicated to gaining greater insight into our customers' needs from our direct engagement and primary research. As such, we continue to invest in developing the software, hardware and payloads that will provide a seamless solution that customers can use to understand better and thereby manage their operations more effectively. Our next phase of projects with early adopters is designed to validate our solution and business case further and will continue to inform our market introduction plans to maximize customer ROI, our market share and value creation.

在商用 UAS 方面，我們致力於透過直接互動與第一手研究，更深入洞察客戶需求。因此，我們持續投資開發軟體、硬體與酬載，以提供無縫的解決方案，協助客戶更好地理解並因此更有效地管理其營運。我們與早期採用者的下一階段專案旨在進一步驗證我們的解決方案與商業案例，並將持續為我們的市場導入計畫提供資訊，以最大化客戶投資報酬率（ROI）、我們的市占率與價值創造。

We are engaged with customers in agriculture, energy, transportation and power industries. These emerging commercial markets represent large opportunities for us.

我們正與農業、能源、運輸與電力產業的客戶合作。這些新興的商業市場對我們而言代表龐大的機會。

We believe we are developing the customer relationships, integrated solutions and business models to position us for market leadership and growth. With this overview of the quarter, Raymond Cook will now provide a more detailed review of our financial performance, after which Tim will return for his thoughts about the balance of the fiscal year.

我們相信，我們正在建立客戶關係、整合式解決方案與商業模式，使我們具備市場領導與成長的定位。以上為本季概述，接下來 Raymond Cook 將更詳細檢視我們的財務表現，之後 Tim 將回來分享他對本會計年度剩餘期間的看法。

Thank you Wahid, and good afternoon everyone.

謝謝你，Wahid，各位下午好。

AeroVironment's fiscal 2016 third-quarter results are as follows. Revenue for Q3 was $67.6 million, a decrease of $0.8 million, or 1%, as compared to $68.4 million a year ago. The decrease in revenue was due to a decrease in product deliveries of $3 million, partially offset by an increase in service revenue of $2.2 million.

AeroVironment 2016 會計年度第三季業績如下：第三季營收為 6,760 萬美元，較去年同期 6,840 萬美元減少 80 萬美元，或 1%。營收下降係因產品交付減少 300 萬美元所致，部分被服務營收增加 220 萬美元所抵銷。

Looking at revenue by segment, UAS revenue was $61.6 million, an increase of $3.1 million, or 5%, compared to last year. The increase was primarily due to an increase in service revenue of $1.3 million and an increase in customer funded R&D work of $0.9 million and an increase in product deliveries of $0.9 million.

按部門別觀察營收，UAS 營收為 6,160 萬美元，較去年增加 310 萬美元，或 5%。增加主要來自服務營收增加 130 萬美元、客戶出資研發（R&D）工作增加 90 萬美元，以及產品交付增加 90 萬美元。

EES revenue decreased $3.9 million, or 38%, to $6.5 million in the third quarter. The decrease was primarily due to a decrease in product deliveries over industrial fast charge systems and a product delivery for our passenger electric vehicle charging systems.

EES 營收於第三季減少 390 萬美元，或 38%，至 650 萬美元。下降主要由於工業快速充電系統的產品交付減少，以及我們乘用電動車充電系統的一筆產品交付所致。

Turning to gross margins, gross margin for the third quarter was $26.6 million, or 39%, a decrease of $0.4 million as compared to $27 million, or 39%, in the prior year. The decrease in gross margin was due to a decrease in product margins of $2 million, largely offset by an increase in service revenue margins of $1.6 million.

轉至毛利率，第三季毛利為 2,660 萬美元，或 39%，較去年同期 2,700 萬美元（39%）減少 40 萬美元。毛利下降係因產品毛利減少 200 萬美元所致，但大部分被服務營收毛利增加 160 萬美元所抵銷。

By segment, UAS gross margin decreased to $24.6 million for the three months ended January 30, 2016 from $24.8 million. As a percentage of revenue, gross margin for UAS decreased from 43% to 40%, primarily due to product mix.

按部門別，UAS 毛利於截至 2016 年 1 月 30 日止三個月降至 2,460 萬美元，去年同期為 2,480 萬美元。以營收百分比計，UAS 毛利率由 43% 降至 40%，主要由於產品組合所致。

EES gross margin decreased $0.2 million, or 9%, to $2 million in the quarter, primarily due to decreased sales volume. As a percentage of revenue, EES gross margin increased from 21% to 31%, primarily due to product mix.

EES 毛利於本季減少 20 萬美元，或 9%，至 200 萬美元，主要由於銷售量下降。以營收百分比計，EES 毛利率由 21% 升至 31%，主要由於產品組合所致。

SG&A expense for the third quarter was $13.3 million, or 20%, of revenue compared to SG&A expense of $13.3 million, or 19% of revenue in the prior year. R&D expense for the third quarter was $8.2 million, or 12% of revenue compared to R&D expense of $8.6 million, or 13% of revenue in the prior year.

第三季銷售、一般及行政（SG&A）費用為 1,330 萬美元，占營收 20%，去年同期 SG&A 費用亦為 1,330 萬美元，占營收 19%。第三季研發（R&D）費用為 820 萬美元，占營收 12%，去年同期研發費用為 860 萬美元，占營收 13%。

The operating income for the third quarter was $5.1 million, or 7% of revenue compared to operating income of $5.1 million, or 8% of revenue in the prior year. The benefit for income taxes for the quarter was $1.1 million for an effective tax rate of negative 22.5%, compared to the provision for income taxes of $2.8 million, or an effective tax rate of 54.3% in the prior year. The tax benefit was primarily due to legislation reinstating the federal research and development tax credits during the current order. The net income for the quarter was $6.2 million, or $0.27 per diluted share compared to net income of $2.3 million, or $0.10 per diluted share in the same quarter last year.

第三季營業利益為 510 萬美元，占營收 7%，去年同期營業利益為 510 萬美元，占營收 8%。本季所得稅利益為 110 萬美元，有效稅率為負 22.5%，相較去年同期所得稅費用為 280 萬美元、有效稅率為 54.3%。該稅務利益主要來自本期立法恢復聯邦研發稅額抵減。第三季淨利為 620 萬美元，稀釋後每股盈餘 0.27 美元；去年同期淨利為 230 萬美元，稀釋後每股盈餘 0.10 美元。

Now moving through our first nine months of fiscal 2016 results, revenue for the first nine months of fiscal 2016 was $179.3 million, an increase of $6.4 million, or 4% as compared to $172.9 million a year ago. The increase in revenue was due to an increase in service revenue of $19 million partially offset by a decrease in product delivery of $12.6 million.

現在來看我們 2016 會計年度前九個月的業績，2016 會計年度前九個月營收為 1.793 億美元，較去年同期的 1.729 億美元增加 640 萬美元，或 4%。營收增加係因服務營收增加 1,900 萬美元，部分被產品交付減少 1,260 萬美元所抵銷。

UAS revenue was $157.8 million, an increase of $15.6 million, or 11% compared to last year. The increase was primarily due to an increase in customer funded R&D work of $17.7 million, and an increase in service revenue of $1.8 million, partially offset by a decrease in product deliveries of $4 million. The increase in customer funded R&D work was primarily due to an increase in development programs related to tactical missile systems and large UAS.

UAS 營收為 1.578 億美元，較去年增加 1,560 萬美元，或 11%。增加主要來自客戶出資研發（R&D）工作增加 1,770 萬美元，以及服務營收增加 180 萬美元，部分被產品交付減少 400 萬美元所抵銷。客戶出資研發工作增加主要係因與戰術飛彈系統及大型 UAS 相關的開發計畫增加。

EES revenue decreased $9.2 million, or 30%, to $21.5 million for the nine months ended. This decrease was primarily due to a decrease in product deliveries of our industrial fast charge systems, and in product deliveries of our passenger electric vehicle charging systems.

EES 營收在截至九個月期間減少 920 萬美元，或 30%，降至 2,150 萬美元。此減少主要係因我們工業用快速充電系統的產品交付減少，以及乘用電動車充電系統的產品交付減少。

Gross margin for the first nine months was $74.2 million, or 41%, an increase of $15.3 million, as compared to $58.9 million, or 34% in the prior year. The increase in gross margin was primarily due to an increase in product margins of $5.4 million, and an increase in service revenue margins of $9.8 million, both of which were impacted by the government contract reserve reduction recorded in the second quarter from the settlement of prior-year incurred cost audits.

前九個月毛利為 7,420 萬美元，或 41%，較前一年度的 5,890 萬美元（或 34%）增加 1,530 萬美元。毛利增加主要係因產品毛利增加 540 萬美元，以及服務營收毛利增加 980 萬美元；兩者皆受到第二季因結算前一年度已發生成本稽核而認列之政府合約準備金減少的影響。

UAS gross margin increased $16.2 million, or 32%, to $66.6 million for the nine months ended January 30, 2016. The increase was primarily due to an increase in margins on product sales and service-related contracts and the government contract reserve reduction. As a percentage of revenue, gross margin for UAS increased from 35% to 42%.

截至 2016 年 1 月 30 日止九個月，UAS 毛利增加 1,620 萬美元，或 32%，至 6,660 萬美元。增加主要係因產品銷售與服務相關合約的毛利提升，以及政府合約準備金減少。以營收百分比計，UAS 毛利率由 35% 提升至 42%。

EES gross margin decreased $0.9 million, or 11% to $7.6 million for the first nine months of fiscal 2016, primarily due to lower sales volume. As a percentage of revenue, EES gross margin increased from 28% to 35%, primarily due to product mix and the government contract reserve reduction.

2016 會計年度前九個月，EES 毛利減少 90 萬美元，或 11%，至 760 萬美元，主要係因銷售量較低。以營收百分比計，EES 毛利率由 28% 提升至 35%，主要係因產品組合及政府合約準備金減少。

SG&A expense for the first nine months was $43.3 million, or 24% of revenue, compared to SG&A expense of $40.1 million, or 23% of revenue in the prior year. SG&A expense increased $3.2 million primarily due to higher bid and proposal costs. R&D expense for the first nine months was $28 million, or 16% of revenue, compared to R&D expense of $24.2 million, or 14% of revenue in the prior year.

前九個月 SG&A 費用為 4,330 萬美元，佔營收 24%，相較前一年度 SG&A 費用 4,010 萬美元（佔營收 23%）。SG&A 費用增加 320 萬美元，主要係因投標與提案成本較高。前九個月研發（R&D）費用為 2,800 萬美元，佔營收 16%，相較前一年度研發費用 2,420 萬美元（佔營收 14%）。

The operating income for the first nine months was $2.9 million, or 2% of revenue compared to prior-year loss of $5.5 million, or 3% of revenue. The increase in operating income was primarily due to higher gross margins of $15.3 million, offset by an increase in R&D expense of $3.7 million, and an SG&A expense of $3.2 million.

前九個月營業利益為 290 萬美元，或佔營收 2%，相較前一年度虧損 550 萬美元（或佔營收 3%）。營業利益增加主要係因毛利增加 1,530 萬美元，但被研發費用增加 370 萬美元及 SG&A 費用增加 320 萬美元所抵銷。

Net other expense for the first nine months was $2.1 million compared to prior year net other income of $0.4 million. Net other income decreased primarily due to the first half of fiscal year 2016 other than temporary impairment loss on our CybAero equity securities of $2.2 million. The effective income tax rate benefit for the first nine months was a negative 361.2% compared to the effective tax rate benefit from prior year of a negative 18%.

前九個月其他費用淨額為 210 萬美元，相較前一年度其他收益淨額 40 萬美元。其他收益淨額下降主要係因 2016 會計年度上半年就我們持有之 CybAero 權益證券認列 220 萬美元之非暫時性減損損失。前九個月有效所得稅率利益為負 361.2%，相較前一年度有效稅率利益為負 18%。

The net income for the first nine months of fiscal 2016 was $3.6 million, or $0.16 per share compared to a net loss of $4.2 million, or an $0.18 loss per share in the first nine months of last year. The diluted earnings per share for the first nine months of fiscal 2016 increased by $0.09, due to the reserve reversal on settlement of incurred cost claims, which was partially offset by $0.06 due to losses on impairment and sale of CybAero equity securities. Looking at backlog, funded backlog at the end of the third quarter was $79.7 million, a decrease of $17 million, or 18% from the end of the second quarter of $97 million.

2016 會計年度前九個月淨利為 360 萬美元，或每股 0.16 美元；相較去年前九個月淨損 420 萬美元，或每股虧損 0.18 美元。2016 會計年度前九個月稀釋每股盈餘增加 0.09 美元，係因結算已發生成本索賠而回轉準備金所致，但部分被因 CybAero 權益證券減損及出售損失所致的 0.06 美元所抵銷。就在手訂單（backlog）而言，第三季末已獲資金支持的在手訂單為 7,970 萬美元，較第二季末的 9,700 萬美元減少 1,700 萬美元，或 18%。

Turning to our balance sheet, cash, cash equivalents and investments at the end of the third quarter totaled $258.6 million, an increase of $14.9 million from the prior quarter. The increase in cash, cash equivalents and investments was driven by the net income and lower working capital used in the business.

接著看資產負債表，第三季末現金、約當現金及投資合計 2.586 億美元，較前一季增加 1,490 萬美元。現金、約當現金及投資增加係由淨利以及營運所使用的營運資金降低所帶動。

Turning to receivables, at the end of the third quarter, our accounts receivable including unbilled and retention receivables totaled $49.4 million, a decrease of $5.1 million from the prior quarter. Total days sales outstanding was approximately 66 days, compared to 76 days at the end of the prior quarter.

再看應收款項，第三季末我們的應收帳款（包含未開立帳單及保留款應收款）合計 4,940 萬美元，較前一季減少 510 萬美元。應收帳款週轉天數約為 66 天，相較前一季末為 76 天。

Taking a look at inventory, net inventory was $46.4 million at the end of the quarter compared to $48.3 million at the end of the prior quarter. Days in inventory were approximately 102 days compared to 131 days at the end of the prior quarter. The decrease in days in inventory was primarily attributable to the increase in third-quarter shipments.

再看存貨，季末淨存貨為 4,640 萬美元，相較前一季末的 4,830 萬美元。存貨天數約為 102 天，相較前一季末為 131 天。存貨天數下降主要歸因於第三季出貨增加。

Turning to capital expenditures, in the third quarter we invested approximately $1.5 million or 2% of revenue in property improvements and capital equipment. AV recognized $1.8 million of depreciation and amortization in the quarter.

接著看資本支出，第三季我們在不動產改善與資本設備上投資約 150 萬美元，或佔營收 2%。AV 於本季認列折舊與攤銷 180 萬美元。

Now I would like to talk about our Q3 out-of-period adjustments and material weakness. During the quarter ended January 30, 2016, we identified and corrected errors related to our state used tax liability and certain capital lease agreements previously misclassified as operating leases.

現在我想談談我們第三季的跨期調整（out-of-period adjustments）與重大缺失（material weakness）。在截至 2016 年 1 月 30 日止的季度，我們辨識並更正了與州使用稅負債以及先前被誤分類為營業租賃的若干資本租賃協議相關的錯誤。

These errors were assessed and concluded not to be material to the consolidated financial statements taken as a whole. As a result, the current quarter includes approximately $0.8 million of expense related to prior fiscal years. We assessed the impact of our internal control environment and determined that we have a material weakness in internal control over financial reporting with respect to our state use tax process.

經評估後，我們結論認為這些錯誤就合併財務報表整體而言並不重大。因此，本季包含約 80 萬美元與前幾個會計年度相關的費用。我們評估了內部控制環境的影響，並判定在州使用稅流程方面，我們的財務報導內部控制存在重大缺失。

We have implemented appropriate controls to remediate the material weakness, which will be tested during our fourth fiscal quarter of 2016. We expect that the remediation of this material weakness may be completed as early as April 30, 2016.

我們已實施適當的控制措施以補救該重大缺失，並將於 2016 會計年度第四季進行測試。我們預期該重大缺失的補救作業最早可於 2016 年 4 月 30 日完成。

Now I'd like to turn things back to Tim to discuss AV's expectations for the remainder of fiscal year 2016.

現在我想把時間交還給 Tim，請他說明 AV 對 2016 會計年度剩餘期間的展望。

Thank you, Raymond.

謝謝你，Raymond。

Our solutions address existing and emerging needs across both defense and commercial markets. In our core business, we maintain strong market leadership in small UAS and EES, with about 88% of our year-to-date revenue generated from solutions we delivered to defense customers.

我們的解決方案可滿足國防與商業市場中既有及新興的需求。在我們的核心業務中，我們在小型 UAS 與 EES 維持強勁的市場領導地位，且截至目前為止約 88% 的年初至今營收來自我們交付給國防客戶的解決方案。

Within the defense market, we are also focused on expanding our customer base for small UAS and for tactical missile systems Switchblade variants. Ongoing defense customer R&D funding of our tactical missile systems illustrates the value they place on this growing family of layering munitions systems for their urgent and their future needs.

在國防市場方面，我們也專注於擴大小型 UAS 以及戰術飛彈系統 Switchblade 各型（variants）的客戶基礎。國防客戶持續提供我們戰術飛彈系統的研發資金，顯示他們重視這個日益壯大的分層彈藥系統家族，並用以滿足其迫切需求與未來需求。

Commercial UAS and operating atmospheric satellites represent very large growth opportunities in new markets. Our current investments to develop and pursue new growth opportunities are primarily on the income statement in the form of R&D and SG&A, rather than on the balance sheet. To help frame the potential, the commercial UAS opportunity, a study conducted by AUVSI projected unmanned airplane systems solutions for the US agriculture market alone could generate incremental economic value of billions of dollars over 10 years.

商用無人航空系統（UAS）以及運行大氣層衛星，代表在新市場中非常龐大的成長機會。我們目前為開發並追求新成長機會所進行的投資，主要反映在損益表上，以研發（R&D）與銷售、一般及行政費用（SG&A）的形式呈現，而非列示於資產負債表上。為了協助界定其潛力，針對商用UAS機會，美國無人載具系統國際協會（AUVSI）所進行的一項研究預估，僅美國農業市場的無人飛機系統解決方案，在10年內即可創造數十億美元的新增經濟價值。

As we look to the balance of the fiscal year, we expect quarterly revenue to be the highest of the year in our fourth quarter. Our original guidance range for full-year 2016 revenue of $260 million to $280 million is unchanged.

展望本會計年度剩餘期間，我們預期第四季的季度營收將為全年最高。我們原先對2016全年營收的指引區間為2.60億至2.80億美元，維持不變。

However, we still need to receive contracts for some shipments planned for Q4 revenue, and a significant percentage of our anticipated Q4 revenue consists of international deliveries, which inherently have a greater timing uncertainty due in part to export license requirements. As a result, we now expect our full fiscal 2016 revenue to be in the lower half of our guidance range.

然而，我們仍需取得部分原計畫納入第四季營收的出貨合約，且我們預期第四季營收中有相當比例來自國際交付；由於出口許可等要求，國際交付在時點上本質上具有較高的不確定性。因此，我們目前預期2016整個會計年度的營收將落在指引區間的下半部。

Gross profit has trended higher year to date. Even though we continue to expect lower gross profit margin in the fourth quarter, full-year gross profit percentage is now expected to be higher than we planned at the beginning of the year, and we are raising our gross profit margin guidance for FY16. Our new guidance range is 38% to 39.5%.

年初至今毛利呈上升趨勢。儘管我們仍預期第四季毛利率較低，但全年毛利率目前預期將高於年初規劃，因此我們上調FY16毛利率指引。我們新的指引區間為38%至39.5%。

We expect to increase research and development in SG&A spending significantly in Q4, as I previously discussed. Some of this Q4 increase was by plan, and some was caused by earlier schedule delays. We plan to nearly double R&D investments from Q3 to Q4.

如我先前所述，我們預期在第四季大幅增加研發與SG&A支出。第四季增加的部分支出是依計畫進行，另有部分則是由於先前時程延誤所致。我們計畫將研發投資自第三季到第四季幾乎加倍。

We also plan to significantly increase business development and marketing investments. These investments in R&D and SG&A could likely offset most or all of the operating profit we would have otherwise reported for fiscal 2016, consistent with our guidance from the beginning of the year.

我們也計畫大幅增加業務開發與行銷投資。這些在研發與SG&A上的投資，很可能會抵銷我們在2016會計年度原本可認列的大部分或全部營業利益，這與我們年初提供的指引一致。

Thank you to the AeroVironment team members whose commitment to turning great ideas into innovative technology solutions enables our customers to move forward with confidence. As always, we appreciate the ongoing interest in AeroVironment from each of you. And now Raymond, Wahid and I will take your questions.

感謝AeroVironment團隊成員的投入與承諾，將卓越構想轉化為創新技術解決方案，使我們的客戶能夠更有信心地向前推進。如同以往，我們也感謝各位持續關注AeroVironment。接下來，Raymond、Wahid和我將回答各位的提問。

(Operator Instructions)

（接線員指示）

Bobby Burleson, Canaccord.

Bobby Burleson，Canaccord。

Hi, good afternoon.

嗨，下午好。

Hi Bobby.

嗨，Bobby。

Hi. So I guess high level for Tim, there's been obviously some headwinds in terms of capital budgets for energy companies. And I'm wondering, even though you are probably a couple of layers removed from those headwinds, I'm wondering whether or not you are seeing any impact on a level of customer engagement activity for commercial UAS in that particular vertical or any impact whatsoever?

嗨。所以我想從高層次問Tim，能源公司在資本預算方面顯然面臨一些逆風。即使你們可能距離這些逆風還隔了幾層，我想了解你們是否在商用UAS於該垂直領域的客戶互動活動程度上看到任何影響，或是有任何影響嗎？

Well as you know, we began our commercial operations with small UAS in the Arctic because that was the first area that the FAA approved when they initially gave us limited certification for commercial operation with Puma. And subsequently, we engaged heavily with BP in their Arctic operations and through that engagement demonstrated significant economic benefits that BP reported across multiple applications in that vigorous environment and with the rigorous safety requirements that they and other elements players in the oil patch require.

如你所知，我們以小型UAS在北極展開商業營運，因為當FAA最初給予我們使用Puma進行商業運作的有限認證時，北極是FAA首先核准的區域。其後，我們與BP在其北極作業上密切合作，並透過該合作在嚴苛環境以及其與油氣產業其他參與者所要求的嚴格安全規範下，展示了顯著的經濟效益；這些效益也由BP在多項應用中對外報告。

And since that time, and this time as we are all aware, the price of oil has plummeted, and there have been significant impacts in the industry. In the meantime, we have engaged much more broadly with the advent of greater latitude from the FAA, much more broadly in other industries as Wahid mentioned including power generation, transportation, agriculture and others.

自那之後，且如同大家所知，油價大幅下跌，對產業造成了顯著影響。與此同時，隨著FAA給予更大的彈性，我們也更廣泛地拓展至其他產業，正如Wahid所提到的，包括發電、運輸、農業等。

And within those other industries, we are engaged with multiple lead adopter customers. And while we continue to have an active interest in and see significant benefits in the oil and gas industry, it may be that earlier material adoption will occur in other industries given the macroeconomics going on right now that you referred to.

在這些其他產業中，我們正與多家領先採用者客戶合作。雖然我們仍對油氣產業保持積極興趣並看到顯著效益，但考量你所提到的當前總體經濟情勢，較早出現實質採用的產業可能會是其他領域。

Great, thanks for the feedback on that. And I'm just wondering, this is obviously a year for some strategic investment that you are making impacting your operating income. And I'm wondering is this something that is sustainable or necessarily sustained into 2017, or are we winding down in terms of levels of investment where maybe you guys can slow this spending a little bit next year?

很好，謝謝你對此的回饋。我也想問，這顯然是你們進行一些策略性投資、並影響營業利益的一年。我想了解這樣的投資水準是否可持續，或是否會延續到2017年？還是說投資水準正在收斂，明年你們可能可以稍微放慢支出？

The incremental investments that we began making in commercial UAS solution development last fiscal year have continued this fiscal year, and in both cases, we have indicated when we began the year that we expected the total incremental investments we are developing and those growth opportunities could offset the operating profits that we would otherwise be generating. We have not yet provided any guidance for fiscal 2017, and our expectation is as we usually do, we would provide that guidance on our Q4 call at the end of Q4 for 2016.

我們自上一會計年度開始在商用UAS解決方案開發上增加的投資，在本會計年度持續進行；在這兩個年度中，我們在年初即表示，為開發這些成長機會所做的新增投資總額，可能會抵銷我們原本可產生的營業利益。我們尚未提供2017會計年度的任何指引；依照我們一貫作法，預期會在2016年第四季結束時的Q4電話會議上提供該指引。

So I think we have adequately addressed hopefully the expectation for this year. I think we will not -- we don't expect there to be a cliff at the end of this fiscal year, and we are finished with the development of commercial UAS completely.

因此，我認為我們已充分說明今年的預期。我們不認為在本會計年度結束時會出現投資的「斷崖式」變化，也不代表我們在本會計年度結束後就完全完成商用UAS的開發。

However, you may recall that last fiscal year, we were incrementally investing above our historic levels of 8% to 10% of R&D to address three different growth opportunities where we had immediate customer signals in looking like they were doing the kinds of things they would be doing if they were getting ready to a adopt. And that addressed large UAS opportunities, tactical missile systems and commercial UAS.

不過，你可能記得在上一會計年度，我們在研發投入上高於歷史水準（研發占比約8%至10%）進行了新增投資，以因應三項不同的成長機會；當時我們從客戶端收到明確訊號，顯示他們的行為看起來像是在準備採用。這三項機會包括大型UAS、戰術飛彈系統，以及商用UAS。

And at the conclusion of fiscal 2015, we accomplished our objectives in large UAS incremental investment and in the incremental investment in tactical missile systems. So as we enter this fiscal year, those growth opportunities in addition to our core businesses were all being planned to be addressed within our historical 8% to 10% of R&D. And the incremental investments this year were exclusively associated with developing commercial UAS.

在2015會計年度結束時，我們已達成大型UAS新增投資以及戰術飛彈系統新增投資的目標。因此進入本會計年度時，這些成長機會加上我們的核心業務，原本都規劃在歷史研發占比8%至10%的範圍內推進。而本年度的新增投資則完全與商用UAS的開發相關。

So we do have a pattern of tightly managing those incremental investments, getting the work done and then returning to business as usual. And I think Wahid also focused in his comments about the benefits and the returns that we are seeing already this year in tactical missile systems and the adoption of multiple variants as a result of those fiscal 2015 investments.

因此，我們確實有一套模式：嚴格管理這些新增投資，把工作完成後再回到正常營運。我認為Wahid在評論中也提到，我們已在今年看到戰術飛彈系統的效益與回報；由於2015會計年度的投資，促成多個型號變體被採用。

Great, thank you for answering my questions.

很好，謝謝你回答我的問題。

Howard Rubel, Jefferies.

Howard Rubel，Jefferies。

Thank you very much. First, to talk about efficient energy systems for a minute, Tim, it's been in this $6 million to $8 million range for some time. Do you see any reason why that would accelerate or embark on any other path?

非常感謝。首先談一下高效率能源系統（EES），Tim，這個業務一段時間以來一直在600萬到800萬美元的區間。你是否看到任何理由使其加速成長，或走上其他路徑？

Hi Howard. This is Wahid.

嗨Howard，我是Wahid。

Hi Wahid, how are you?

嗨Wahid，你好嗎？

Thank you. Let me see if I can shed some light on your question. Yes, the EES business as you saw, the revenue has been down year-over-year, and that's actually primarily based on two things. Primarily based on lower shipments of our industrial electric vehicles as well as the focus of our strategy to narrowing it down to specific plays and strategies and business models that we think is going to have a long-term play for us and a long-term ROI.

謝謝。我看看能否針對你的問題提供一些說明。是的，如你所見，EES業務營收年對年下滑，主要基於兩點：第一，我們工業用電動車的出貨量較低；第二，我們策略聚焦於縮小範圍，鎖定我們認為能為公司帶來長期發展與長期投資報酬（ROI）的特定切入點、策略與商業模式。

And we explained that in the last quarter if I'm not mistaken in terms of the product line primarily being around the TurboCord platform of technology that essentially feeds all of our AC charging infrastructure products for EV Solutions. So we've narrowed our focus over the years, and initially we experimented these different business models very frugally to see which business model and what type of application and what type of adoption is going to have a viable long-term play for us. So now since we learned from those experiments and we have learned from our product deployments that the strategy we have around TurboCord is the right strategy to move forward, we have narrowed that focus and we're executing that strategy today.

如果我沒記錯，我們在上一季已說明過：產品線主要圍繞TurboCord技術平台，該平台本質上支撐我們EV Solutions所有交流（AC）充電基礎設施產品。多年來我們逐步收斂焦點，起初以非常節制的方式嘗試不同商業模式，以了解哪一種商業模式、哪一類應用與哪一種採用情境，能對我們形成可行的長期布局。如今，基於這些實驗與產品部署的學習，我們確認以TurboCord為核心的策略是正確的前進方向，因此我們已收斂焦點，並正在執行該策略。

Just to follow up on that, it's clear the profitability is much better with a little more consistency. So I think that's one of the fruits of this labor I suppose.

只是跟進一下，很明顯在更一致一些的情況下，獲利能力好得多。所以我想這算是這些努力的成果之一。

That is accurate. One of the benefits of focusing on what I refer to as one platform based on the TurboCord technology enables us A, to have one development cycle that could benefit multiple products for multiple application. At the same time, it helps our cost structure in terms of volume that we make the same platform for multiple products, and eventually it will actually be a global platform that we can deploy globally as we move forward in this market.

沒錯。專注於我所稱的、以 TurboCord 技術為基礎的單一平台，其中一個好處是：A，我們可以只有一個研發週期，卻能讓多項產品、用於多種應用而受益。同時，從成本結構來看，因為我們以相同平台支援多項產品，隨著產量提升也有助於成本；最終它實際上會成為一個可在全球部署的全球平台，讓我們在這個市場持續往前推進時能夠全球化佈署。

If I just may, just to talk about LMAMS for a moment, it looks as if you have the camel's nose under the tent. I saw about $4.5 million I think in the president's budget for that, but there is typically a lot more than that behind that. Could you or Tim provide a little bit of color and context please?

如果我可以的話，先談一下 LMAMS。看起來你們已經把「駱駝的鼻子伸進帳篷」了。我看到總統預算裡面好像有大約 450 萬美元編列給這個項目，但通常背後還有更多。你或 Tim 能否提供一些補充說明與背景脈絡？

Sure. Let me try if I could add some color to that. The line item budget that you just mentioned, certainly as I mentioned in my earlier remarks is a positive indicator of our government realizing and getting more serious about LMAMS as a program of record.

當然。我試著補充一些說明。你剛提到的那個預算科目，正如我先前的發言所說，確實是一個正面指標，顯示政府正在意識到並且更認真地把 LMAMS 視為一個正式列管（program of record）的計畫。

Although the process and the steps towards that outcome still is quite long and not very clear as to when and how that's going to happen within the DOD budgeting process. Obviously there's a process that DOD has the steps that they go through, but the timing of course is very difficult to predict.

不過，通往那個結果的流程與步驟仍然相當漫長，而且在國防部（DOD）預算流程中，何時、如何發生仍不太明確。顯然 DOD 有其既定流程與步驟，但時點當然非常難以預測。

Having said that, we continue to see very strong interest from our customers in the Switchblade family of products. And since the inception of Switchblade, we now have four additional variants of the product in various stages of adoption.

話雖如此，我們仍持續看到客戶對 Switchblade 產品家族有非常強烈的興趣。而且自 Switchblade 問世以來，我們現在又新增了四個產品變體，正處於不同的採用階段。

We typically start that cycle with the concept development based on our own R&D, and once the customer gets to see the value and the capability of these innovations, then we see the customers actually providing funding towards further development and then eventually we get into an initial production and long-term adoption. So we're in different phases of that cycle with various variants of that product, and we expect this product line to do well and we expect our customers to benefit from the unique advantages and capabilities that this product line offers to our military.

我們通常會先以自有研發（R&D）進行概念開發；一旦客戶看到這些創新的價值與能力，我們就會看到客戶提供資金支持後續開發，接著最終進入初期量產與長期採用。因此，我們在該產品不同變體上正處於這個循環的不同階段；我們預期這條產品線會有良好表現，也預期客戶能從這條產品線為我軍提供的獨特優勢與能力中受益。

Peter Arment, Sterne Agee.

Peter Arment，Sterne Agee。

Hi guys, thanks, good afternoon. Tim, question on the Puma order that you mentioned, $13 million received from the Marine Corps.

各位好，謝謝，下午好。Tim，關於你提到的 Puma 訂單問題：海軍陸戰隊下了 1,300 萬美元的訂單。

I think the last thing I had seen from them they indicated they were looking for an objective of something like 87 systems. Where does this order fit into that? Should we expect more on the backside of that throughout the year, maybe you could just start there?

我記得他們上次提到的目標好像是大約 87 套系統。這筆訂單在那個目標中屬於什麼位置？我們是否應該預期今年後續還會有更多訂單？也許你可以先從這裡談起？

We think this is just a continuation of their commitment to their next-generation family of systems requirement that they established last year that has Puma on the large side and WASP on the small side of their small UAS platforms, and that brackets the prior Raven systems that they had previously procured. I think it's another step forward as they apply their scarce financial resources to filling out that objective requirement.

我們認為這只是他們對於去年所建立的「下一代系統家族」需求的持續承諾：在小型無人機（UAS）平台中，Puma 屬於較大型端，WASP 屬於較小型端，並且涵蓋了他們先前採購的 Raven 系統。我認為這是他們在將有限的財務資源投入以滿足該目標需求上的又一步進展。

Got it. And then just regarding the adoption of Puma, you hinted at some of the further interest that has grown from the Navy and the Coast Guard. What should we expect on the development there?

了解。那再談 Puma 的採用情況，你提到海軍與海岸防衛隊的興趣有所增加。那邊的發展我們應該期待什麼？

So Peter, on the Puma AE system, we believe our products and that system offer a substantial benefit and competitive advantage to our customer base and to our military and in various international customers as well. We're in various stages of adoption of that system in that product category with various customers both domestically and internationally.

Peter，關於 Puma AE 系統，我們相信我們的產品與該系統能為客戶群、我軍，以及各國際客戶帶來顯著效益與競爭優勢。我們正與多個客戶（包含國內與國際）在該產品類別上處於不同的採用階段。

And so we've been working with the US Navy for a long time on the maritime application of Puma AE, and so far the indications are fairly positive. And the fact that we are now able to deploy Puma AE systems without any modifications to any type of ship that's within the Naval footprint is what I consider a significant progress towards enabling adoption to occur.

我們與美國海軍在 Puma AE 的海事應用上合作已久，目前的跡象相當正面。而且，我們現在能在不對任何屬於海軍體系的艦艇做任何改裝的情況下部署 Puma AE 系統，我認為這是促成採用發生的一項重大進展。

When and how that materializes itself as we mentioned before, it's hard to predict in terms of exact timing. But the indications are fairly strong, and we are in constant engagement with our customers to help them get the benefit of these products and adopt the systems further within their footprint.

至於何時、如何具體落地，正如我們之前提到的，很難精確預測時點。但跡象相當強勁，我們也持續與客戶保持密切互動，協助他們取得這些產品的效益，並在其體系內進一步採用這些系統。

That's great color. Thanks Ray.

這些補充很有幫助。謝謝 Ray。

You are welcome.

不客氣。

Troy Jensen, PHC.

Troy Jensen，PHC。

Thanks for taking my questions gentlemen. Maybe for Tim, maybe your confidence or conviction that we're going to see growth in US military drone spending in 2016. So stripping out international expansion, do you think US drone market will grow for you this year over last year?

謝謝兩位回答我的問題。可能問 Tim：你對於 2016 年美軍無人機支出將成長的信心或把握程度如何？如果把國際擴張因素剔除，你認為今年你們在美國無人機市場的表現會比去年成長嗎？

Okay Troy, if I understood your question, it was primarily around if you were to take out the defense use of our products domestically and not internationally, where do we see the growth, is that accurate?

好的 Troy，如果我理解正確，你的問題主要是：如果只看我們產品在國內（不含國際）的國防用途，我們認為成長會在哪裡出現，是這個意思嗎？

Yes, domestic spending, yes.

是的，國內支出，是的。

So Troy, with our SUS family of systems, we are as you know have shipped a large number of systems already to the US Army for many years. And since the initial deployment of those systems, we have gone through various engagements of various other branches of the military, namely the Navy, the US Coast Guard, and special operations, and of course there are others too.

Troy，就我們的 SUS 系統家族而言，如你所知，我們多年來已向美國陸軍出貨大量系統。自最初部署以來，我們也與其他軍種進行了各種合作與推進，主要包括海軍、美國海岸防衛隊，以及特種作戰單位，當然也還有其他單位。

In each case, the development cycle or the adoption cycle that we are engaged with those customers vary. And so while the US Army you could argue may not have such a huge demand for these products for the short-term basis, other branches of the military will.

在每一種情況下，我們與這些客戶所處的研發週期或採用週期都不相同。因此，雖然你可以說美國陸軍在短期內對這些產品的需求可能不會那麼大，但其他軍種會有需求。

So as a whole, we are quite positive on the strength of our core business domestically. And on top of that, we have a growing number of international customers as you heard earlier, and there seems to be strong interest from multiple international customers across the entire family of our small UAS systems.

因此整體而言，我們對於國內核心業務的強勁表現相當正面。此外，正如你先前聽到的，我們的國際客戶數量也在增加，而且多個國際客戶對我們整個小型 UAS 系統家族都展現出強烈興趣。

Okay, I understand that. My follow-up question is on your commercial market focus here. Curious to know if you're going to pursue the same strategy with the BP where you're trying to get a type certification for your new drone platform. And can you speak to what the competitive advantages would be to have the type certification over competitors?

好的，我理解。我的追問是關於你們在商用市場的聚焦。我想知道你們是否會對 BP 採取相同策略，也就是為你們新的無人機平台爭取型式認證（type certification）。你能談談相較競爭對手，擁有型式認證的競爭優勢是什麼嗎？

The point you are making I think is we uniquely have a type certification on Puma, and we are using Puma primarily although not exclusively in the pilot programs that we are engaged with multiple customers in multiple industries now. At the same time, the next generation solution for commercial applications that we are developing incorporates the development of software payloads and platforms that are optimized for those commercial applications.

你提到的重點是：我們在 Puma 上獨特地擁有型式認證，而我們目前主要（但不僅限於）在與多個產業、不同客戶所進行的試點計畫中使用 Puma。同時，我們正在開發的下一代商用解決方案，包含針對商用應用最佳化的軟體、載荷與平台的開發。

And it may or may not turn out to be a critical differentiator to pursue type certification on the platform itself at that time. And I think we are cognizant of the opportunity and will make that decision as we get close to deployment and evaluate how the FAA's process of approving commercial operations evolves over time. As you know, that is evolving rapidly.

至於屆時是否要在平台本身追求型式認證，可能會、也可能不會成為關鍵差異化因素。我們了解這個機會，並會在接近部署時做出決策，同時評估 FAA 對商業運行的核准流程隨時間如何演進。如你所知，這個流程正在快速變化。

Understood. Thanks guys. Good luck.

了解。謝謝各位。祝順利。

Thank you.

謝謝。

(Operator Instructions)

（接線員指示）

Josephine Millward, Benchmark Company.

Josephine Millward，Benchmark Company。

Good afternoon.

下午好。

Hi Josephine.

嗨，Josephine。

Hi Tim. Can you give us an update on your visibility to guidance, whether to the low end or the mid end? And do you feel EES will be flat for the year because that was your assumption in the past?

嗨 Tim。你能更新一下你們對財測指引的能見度嗎？是偏向區間低端還是中位？另外，你是否仍認為 EES 全年會持平，因為你們過去是這樣假設的？

Hi Josephine, it's Raymond, and I will walk you through our updated FY16 visibility. As of today, we have year-to-date Q3 revenues of $179 million. Our Q3 ending backlog that we expect to execute in FY16 is an additional $66 million.

嗨 Josephine，我是 Raymond，我來帶你看我們更新後的 2016 財年（FY16）能見度。截至今天，我們年初至今的第三季（Q3）營收為 1.79 億美元。我們在第三季末的在手訂單（backlog）中，預期可在 FY16 執行的還有另外 6,600 萬美元。

Our Q4 quarter to date bookings that we anticipate to execute in FY16 is an additional $4 million, and our unfunded backlog from incrementally funded contracts that we anticipate to recognize revenue during the balance of the year is $0.4 million. So this adds up to $250 million or 93% at the mid-point of our revenue guidance of $260 million to $280 million.

我們第四季截至目前的訂單（我們預期將在 FY16 執行）額外為 400 萬美元，而我們來自增量撥款合約、預期在今年剩餘期間認列營收的未撥款在手訂單為 40 萬美元。因此，這合計為 2.5 億美元，或以我們 2.6 億至 2.8 億美元營收指引中點 2.6 億美元計算的 93%。

In our visibility walk down, we typically include an assumption of revenue required for EES to be flat compared to the previous year. You will notice that we do not include that assumption in this walk down.

在我們的可見度拆解（visibility walk down）中，我們通常會納入一項假設：EES 所需認列的營收相較前一年持平。您會注意到，我們在這次拆解中沒有納入該假設。

The reason for the change this quarter is that EES year-to-date revenue is trending down compared to last year, and we believe the full-year EES revenue will be lower this year than last year. As a result, we do not believe including that assumption would be helpful this quarter.

本季之所以改變，是因為 EES 年初至今的營收相較去年呈下降趨勢，我們認為今年全年 EES 營收將低於去年。因此，我們認為本季納入該假設並無助益。

Thank you very much for that. And looking ahead, the overall defense budget is improving. And looking at the fiscal year 2017 budget, do you think visibility is improving for AV in the coming year? And can you talk about whether you expect commercial to be a driver for you in fiscal year 2017?

非常感謝。展望未來，整體國防預算正在改善。就 2017 會計年度預算而言，您認為 AV 在來年可見度是否正在提升？另外，您能談談是否預期商用市場會在 2017 會計年度成為推動力嗎？

Josephine, this is Wahid. Hi there.

Josephine，我是 Wahid。你好。

Hi Wahid.

嗨 Wahid。

In terms of the fiscal 2017 budgets for defense, I am personally not very versed into that budget, but we believe that in general the prospects for small UAS and TMS family of systems which is part of our portfolio seems quite positive. We're in various customer engagements that show fairly strong signs of adoption, and on our installed base, we also have opportunities for upgrades and sustainment of our existing install base of 20,000 plus systems that are out there.

就 2017 會計年度的國防預算而言，我個人對該預算並不是非常熟悉，但我們相信整體而言，小型 UAS 與 TMS 系列系統（屬於我們產品組合的一部分）的前景相當正面。我們正與多位客戶進行各種接洽，顯示出相當強的採用跡象；此外，就我們的既有裝機基礎而言，對於已部署在外、超過 20,000 套系統，我們也有升級與維持（sustainment）的機會。

And so from that perspective, I think that the defense budget, although it's far large and our portion of that is quite insignificant, we typically in any given year see quite different types of demands based on urgent needs, based on upgrade, based on the needs of different forces within the military. So I just don't think there is a very direct correlation between the total budget in AV, but in general our space seems to be quite encouraging within the domestic markets for defense.

因此從這個角度來看，國防預算雖然規模龐大，而我們在其中所占比重相當微小，但我們通常在任何一年都會因緊急需求、升級需求，以及軍中不同部隊的需求，而看到相當不同類型的需求。所以我不認為總預算與 AV 之間存在非常直接的關聯；但整體而言，在國內國防市場中，我們所處的領域看起來相當令人鼓舞。

And in regards to your commercial market, as you heard earlier, commercial UAS revenues are not material to our total revenue this year. And we're still in the early stages, and we are engaged in various pilot projects as you heard earlier from Tim in my remarks, and it's a fairly large opportunity for the long run. At this stage, we're still formulating our business models and validating the customers' requirements and needs and a unique solution set that could really address their needs while delivering value to both our customers and our stockholders.

至於商用市場，如同先前您所聽到的，今年商用 UAS 營收對我們總營收而言並不具重大性。我們仍處於早期階段，並如同我在談話中、以及您先前從 Tim 那裡聽到的，我們正參與各種試點專案；長期而言這是一個相當大的機會。在現階段，我們仍在制定商業模式、驗證客戶的需求與要求，以及能真正滿足其需求、同時為客戶與股東創造價值的獨特解決方案組合。

Thank you.

謝謝。

You are welcome, Josephine.

不客氣，Josephine。

Joe DeNardi, Stifel.

Joe DeNardi，Stifel。

This is Sam McKelvey on for Joe DeNardi. What's driving the increased investment in 4Q specifically? Is it customer competitions or bid activity, and when do you expect to hear decisions on these opportunities?

我是代替 Joe DeNardi 的 Sam McKelvey。第四季特別增加投資的驅動因素是什麼？是客戶競標或投標活動嗎？您預期何時會聽到這些機會的決策結果？

This is Tim, Sam. If I heard your question right, it's the increase in the investments in Q4 and what's driving that.

我是 Tim，Sam。如果我沒聽錯，你的問題是第四季投資增加，以及其驅動因素。

Yes.

是的。

It's two areas, it's research and development and business development/marketing. And it's primarily around the incremental investments in commercial UAS that we are pursuing this year.

主要有兩個領域：研發，以及業務開發／行銷。這主要與我們今年正在推進的商用 UAS 額外投資有關。

Some of that was part of our initial plan that built those investments throughout the year and to the highest level in Q4. And then that is exacerbated by some schedule slides in those development programs that are now being picked up in Q4.

其中一部分是我們原始計畫的一部分，該計畫將這些投資分配在全年，並在第四季達到最高水準。接著，由於這些開發專案的時程出現一些延後，相關工作現在被延至第四季進行，因而使情況更為明顯。

And as a result as I mentioned in my comments, our current expectation is that our Q4 R&D in total will almost double from our Q3 R&D. And at the same time, we are increasing business development and marketing investments that fall under SG&A.

因此，如同我在評論中提到的，我們目前的預期是第四季整體研發費用將較第三季幾乎翻倍。同時，我們也在增加歸類於 SG&A 之下的業務開發與行銷投資。

Great, thank you, and LMAMS, how is the funding broken out in the budget compared to what you were expecting? And what are you hearing from the customers how it ramps up? And what's the expectation for when it gets included in the base budget?

很好，謝謝。那麼 LMAMS，在預算中的資金配置相較於你們原先預期是如何拆分的？你們從客戶那裡聽到它將如何逐步增加（ramp up）？以及預期何時會被納入基本預算（base budget）？

Well last year, you may recall we were anticipating the possible introduction of LMAMS in the palm, which would have put the program on track for a potential program of record launch in government FY17, I believe. It did not make the cut. As best as I can understand it, that went down to the wire, but I'm not on the inside of those decisions.

嗯，去年你可能記得，我們原本預期 LMAMS 可能會被納入 POM（計畫目標備忘錄），這將使該專案有望在政府 FY17 啟動成為正式列管專案（program of record），我記得是這樣。但它沒有通過。就我所能理解的，當時幾乎到最後一刻才定案，但我並不在那些決策圈內。

We are really pleased to see that it made it to a line item this year, and we think that's very much more significant than the actual amount of money initially funded in that line item. So we hope to see -- hope, I take that word back. We believe we may see an ongoing acceleration of that, and we certainly find that the more these systems are being used, the greater the demand for these systems appears to be growing.

我們很高興看到今年它成為一個預算科目（line item），而我們認為這比該科目最初撥付的金額本身更具意義。因此我們希望看到——不，我收回「希望」這個詞。我們相信可能會看到其持續加速；而且我們確實發現，這些系統使用得越多，對這些系統的需求似乎就越在成長。

And we have seen and reported in our earlier discussions that we are receiving incremental funding for not only variant production solutions, but customer funded research and development for additional variants. I will just end it with a general sense of optimism that these systems are doing the job that we had hoped they would for our customers, and we are seeing the result in demand.

而且我們在先前的討論中也已看到並對外說明，我們正在獲得增量資金，不僅用於不同型號（variant）的量產解決方案，也包括由客戶出資的研發，用於更多額外型號。我最後以一個整體的樂觀感受作結：這些系統正在為客戶完成我們所期望它們完成的任務，而我們也在需求面看到了結果。

Great. Thank you.

很好，謝謝。

I'm not showing any further questions. I will turn the call back over to Mr. Gitlin for closing remarks.

我這邊沒有看到其他問題。我將把電話會議交回給 Gitlin 先生作結語。

Thank you Bridget, and thank you all for your attention today and for your interest in AeroVironment. An archived version of this call, all SEC filings and relevant company and industry news can be found on our website at www.avinc.com.

謝謝 Bridget，也謝謝各位今天的關注，以及對 AeroVironment 的興趣。本次電話會議的存檔版本、所有 SEC 申報文件，以及相關公司與產業新聞，都可在我們的網站 www.avinc.com 上找到。

We look forward to speaking with you again following next quarter's results. Have a good day.

我們期待在下個季度業績公布後再次與各位交流。祝各位有美好的一天。

Ladies and gentlemen, this does conclude the program and you may all disconnect. Everyone have a great evening.

各位女士先生，本次會議到此結束，您現在可以掛線。祝各位有個美好的夜晚。