American Vanguard Corp (AVD) 2023 Q4 法說會逐字稿

Greetings, and welcome to the American Vanguard Fourth Quarter and Full Year 2023 Conference Call and Webcast. At this time, all participants are in a listen only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Bill Kuser, Director of Investor Relations.

您好，歡迎參加美國先鋒集團 2023 年第四季和全年電話會議和網路廣播。此時，所有參與者都處於只聽模式。正式演講後將舉行簡短的問答環節。如果有人在會議期間需要接線員協助，請按下電話鍵盤上的星號零。提醒一下，本次會議正在錄製中。現在我很高興向您介紹主持人，投資者關係總監比爾庫瑟 (Bill Kuser)。

Thank you. You may begin.

謝謝。你可以開始了。

Thank you very much, Diego, and welcome, everyone, to American Vanguard's Fourth Quarter and Full Year 2023 earnings review.

非常感謝迭戈，並歡迎大家觀看美國先鋒集團 2023 年第四季和全年收益回顧。

Our speakers today will include Mr. Eric Wintemute, Chairman and CEO of American Vanguard, Mr. David Johnson, the Company's Chief Financial Officer, for assisting in your questions. Mr. Bob Daigle, the Company's Chief Operating Officer, Mr. Don gold, dominate the Chief Transformation Officer, and Tim Donnelly, the Chief Administrative Officer.

今天我們的演講嘉賓包括美國先鋒集團董事長兼執行長 Eric Wintemute 先生和公司財務長 David Johnson 先生，他們將協助解答大家的問題。Bob Daigle 先生擔任公司首席營運官，Don Gold 先生擔任首席轉型官，Tim Donnelly 先生擔任首席行政官。

Before beginning, let's take a moment for our usual cautionary reminder in today's call, the Company may discuss forward-looking information. Such information and statements are based on estimates and assumptions by the Company's management and are subject to various risks and uncertainties that may cause actual results to differ from management's current expectations. Such factors can include weather conditions, changes in regulatory policy, competitive pressures, and various other risks that are detailed in the Company's SEC reports and filings. All forward-looking information represents the Company's best judgment as of the date of this call, and such information will not necessarily be updated by the company. Additionally, bear in mind that the financial information that we discuss today is subject to the completion of a full year 2023 audit process. With respect to the filing of our Form 10-K we are still in the midst of completing documentation, and we'll likely be filing with the SEC for an extension to the due date under Rule 12 b dash 25, thus the 10-K will be filed within 15 days after March 15, 2024.

在開始之前，讓我們花點時間在今天的電話會議中進行我們通常的警告提醒，公司可能會討論前瞻性資訊。此類資訊和陳述基於公司管理層的估計和假設，並受到各種風險和不確定性的影響，可能導致實際結果與管理層目前的預期有所不同。這些因素可能包括天氣條件、監管政策的變化、競爭壓力以及公司向 SEC 報告和文件中詳細說明的各種其他風險。所有前瞻性資訊均代表本公司截至本次電話會議日的最佳判斷，本公司不一定會更新此類資訊。此外，請記住，我們今天討論的財務資訊取決於 2023 年全年審計流程的完成。關於 10-K 表格的提交，我們仍在完成文件編制過程中，我們可能會向 SEC 提交申請，要求根據規則 12 b 破折號 25 延長到期日，因此 10-K將於2024年3月15日後15天內提交。

With all that said, I turn it over now to Eric Wintemute.

話雖如此，我現在將其交給 Eric Wintemute。

Thanks, Bill for everyone and welcome to American Vanguard's full year 2023 earnings call. I appreciate your continued support and interest.

謝謝比爾，謝謝大家，歡迎參加美國先鋒集團 2023 年全年財報電話會議。感謝您持續的支持與關注。

Today, I would like to cover four topics. Excuse me, you may have muted yourself our line of sight.

今天我想講四個話題。對不起，你可能把我們的視線靜音了。

Okay. First, as you'll see on slide first, our full year performance, with particular note on how we rebounded in Q4. Second, current market conditions, which are stable. Third, our sound business fundamentals, and fourth, our initiative to unlock American Vanguard's full value.

好的。首先，正如您首先在幻燈片中看到的那樣，我們的全年業績，特別是我們在第四季度的反彈情況。二是當前市場行情平穩。第三，我們良好的業務基礎；第四，我們主動釋放美國先鋒集團的全部價值。

Before I get to the last point, I will have David give us an update on our financial performance. When we last spoke in January, we gave your performance targets for 2024 because as I will outline today, we are still targeting 24 net sales to increase by 8% to 12% over 2023. However, we are now raising our target for adjusted EBITDA to fall between $70 million and $80 million. With that kind of performance, we should receive a higher valuation than what we are currently seeing in the market. As you well know, our stock has historically traded at over 10 times EBITDA and now if you use net debt plus market cap and divide it by $75 million, the midpoint of our '24 EBITDA target, we are currently trading at under six times with a strong balance sheet, stable markets that after having de-risked supply issues, we are poised to enhance shareholder value this year.

在講最後一點之前，我將請 David 向我們介紹我們的財務表現的最新情況。當我們上次在 1 月談話時，我們給出了 2024 年的業績目標，因為正如我今天概述的那樣，我們的目標仍然是 24 的淨銷售額比 2023 年增長 8% 至 12%。然而，我們現在將調整後 EBITDA 的目標提高到 7,000 萬美元至 8,000 萬美元之間。有了這樣的表現，我們應該會獲得比目前市場上更高的估值。如您所知，我們的股票歷史上的交易價格是EBITDA 的10 倍以上，現在如果您使用淨債務加上市值，並將其除以7500 萬美元（我們24 年EBITDA 目標的中點），我們目前的交易價格不到六倍強勁的資產負債表和穩定的市場，在消除供應問題風險後，我們今年可望提高股東價值。

Further, I'm pleased to report in summary that we are able to accomplish in Q4 at this point, I can say definitively that Q4 was in fact a rebound period for us, as you will note on slide 5, due to global destocking activity, a glut of generic products from China and supply issues of two of our leading products, Aztec, in fact, all our performance for the first nine months of 2023 was below expectations with the supply chain mended two of our high-margin products in hand and then subsidence and destocking, we were able to record 8% higher sales in Q4 as compared to the prior year.

此外，我很高興總結地報告，我們能夠在第四季度完成這一點，我可以明確地說，由於全球去庫存活動，第四季度實際上是我們的反彈期，正如您在幻燈片5 中註意到的那樣來自中國的仿製藥供過於求，以及我們的兩種主導產品Aztec 的供應問題，事實上，我們2023 年前9 個月的所有業績都低於預期，供應鏈修復了我們手中的兩種高利潤產品然後是沉降和去庫存，我們第四季度的銷售額比去年同期增長了 8%。

I will also note that with respect to as type of backhaul, we have dual source the supply of raw materials and intermediates, thereby ensure ensuring continuity and availability going forward. Over the course of Q4, our working capital balance sheet improved for a more normal level and with higher sales, we reduced inventory to $220 million, generating cash from both sales and customer prepay reduced net debt to $128 million and increased borrowing capacity to $112 million in the process, we improved our debt to EBITDA ratio significantly to land comfortably below our target of 2.75 times in the short term. This will reduce our interest rate by kind of minimum 0.5%, further a stronger balance sheet and improved liquidity, both enable us to allocate cash judiciously and provide a firm foundation for operating the business '24. That brings up the second period of focus. Current market conditions covered this on Slide 6. As you know, grain particularly corn and wheat. Also, soybeans are global commodities and their prices are influenced by global factors. In 2023, Brazil passed the US alone as the largest supplier of corn and soybeans in the world with good yield and increased supply from Brazil. Prices for these crops have declined. For example, the price of corn in the US has dropped nearly one-third since early last year from six 38 a bushel to about four and a quarter. Proportional have said the farm economy has been strong for the past two years and demand for crops and crop inputs remains stable, even as commodity price levels issued. At the same time, biologicals are continuing to gain traction with growers. These inputs typically contribute to soil health and appeal to growers as us and sustainable long-term investments and their most valuable asset that is their land.

我還要指出的是，對於回程類型，我們擁有原材料和中間體的雙重供應，從而確保未來的連續性和可用性。在第四季度，我們的營運資金資產負債表改善至更正常的水平，隨著銷售額的增加，我們將庫存減少至2.2 億美元，從銷售和客戶預付款中產生現金，將淨債務減少至1.28 億美元，並將借款能力增加至1.12 億美元在此過程中，我們的債務與 EBITDA 比率顯著提高，在短期內輕鬆低於 2.75 倍的目標。這將使我們的利率降低至少 0.5%，進一步增強資產負債表並改善流動性，使我們能夠明智地分配現金，並為經營業務 '24. 提供堅實的基礎。這就引出了第二個焦點時期。目前的市場狀況在投影片 6 中對此進行了介紹。如您所知，穀物特別是玉米和小麥。此外，大豆是全球性商品，其價格受到全球因素的影響。2023年，巴西超越美國，成為全球最大的玉米和大豆供應國，產量良好，巴西供應量增加。這些農作物的價格已經下降。例如，自去年初以來，美國玉米價格已下跌近三分之一，從每蒲式耳 6 38 降至約 4 又四分之一。比例表示，過去兩年農業經濟一直強勁，即使大宗商品價格水準公佈，對農作物和農作物投入的需求仍然穩定。同時，生物製品也持續受到種植者的青睞。這些投入通常有助於土壤健康，並吸引我們這樣的種植者和可持續的長期投資以及他們最有價值的資產——土地。

We are also seeing continued interest in products that have a softer environmental footprint with respect to distribution channel, the de-stocking and frenzy of 2023 Synta import that self-help growers still need inputs insist that they will tend to bind them closer to season in order to minimize carrying costs. This is true over the length of the distribution channel. Also, as evidenced by our Q4 sales distribution channel will purchase crop inputs even in advance of the planting season. Further demand for our end-use products in the US was stable on '23 on a full-year basis. That said, we are seeing a higher level of sophistication and discipline in inventory control at the retail end of the distribution, some of our competitors have softened their guidance for '24, noting an inventory overhang of their products in the distribution channel. The state of oversupply largely affects South America, particularly Brazil and Europe. By contrast, we are not facing book within our major markets. We are a niche player in Brazil, and our sales into that country are minimal further. As I mentioned on our last call, AdCom sales in Brazil dropped by an average of 33% in 2023, while ours declined by only 4%. Certainly we do very little business in Europe.

我們還看到，人們對分銷渠道方面環境足跡較弱的產品持續感興趣，2023 年 Synta 進口的去庫存和狂熱，自助種植者仍然需要投入，堅稱他們傾向於將其與季節聯繫起來。以盡量減少運輸成本。在整個分銷管道中都是如此。此外，我們第四季的銷售分銷管道甚至會在種植季節之前購買農作物投入品。23 年全年，美國對我們最終用途產品的進一步需求保持穩定。也就是說，我們看到分銷零售端的庫存控制更加複雜和嚴格，我們的一些競爭對手已經軟化了 '24 的指導，指出其產品在分銷渠道中庫存過剩。供應過剩的狀況很大程度上影響了南美洲，特別是巴西和歐洲。相比之下，我們在主要市場上並沒有面臨預訂的情況。我們在巴西是一個利基市場參與者，我們在該國的銷售額進一步微乎其微。正如我在上次電話會議中提到的，2023 年巴西的 AdCom 銷售額平均下降了 33%，而我們的銷售額僅下降了 4%。當然，我們在歐洲的業務很少。

Let's turn now to the third element of our discussion on slide 7. That is American Vanguard and its business fundamentals. In light of the market conditions that I just outlined with respect to last year's destocking and our industry's poor performance, it bears repeating that even with the on availability of two of our high-margin products we outperform the ad market as our net sales were down 5% year over year for the industry average was closer to 13%. In other words, we were not affected as materially by destocking or for that matter, Chinese generic pressure. And as I say, procurement has been rationalized by the channel. Also, we did not oversupply that market '23 that is resolved with the market demand and with our price reduction. In fact, we have maintained brand value and legitimacy in the eyes of our customers. This confidence is reflected in their continued commitment toward the significant prepayments that many of our U.S. customers made in Q4. Given our favorable inventory position and the channel distribution, current sales activity and our customers' outlook, we are targeting a sales increase of 8% to 12% and adjusted EBITDA of $7 million '24.

現在讓我們轉向投影片 7 中討論的第三個要素。這就是美國先鋒集團及其商業基礎。鑑於我剛才概述的有關去年去庫存的市場狀況以及我們行業的糟糕表現，值得重申的是，即使我們推出了兩種高利潤產品，我們的表現仍優於廣告市場，因為我們的淨銷售額下降了年增5%，行業平均接近13%。換句話說，我們並沒有受到去庫存或中國普遍壓力的重大影響。正如我所說，採購已通過管道合理化。此外，我們沒有對市場'23 供應過剩，這是透過市場需求和我們的降價來解決的。事實上，我們在客戶眼中保持了品牌價值和合法性。這種信心體現在他們對我們的許多美國客戶在第四季度支付的大量預付款的持續承諾。鑑於我們有利的庫存狀況和通路分佈、當前的銷售活動以及客戶的前景，我們的目標是銷售額增長 8% 至 12%，調整後 EBITDA 為 700 萬美元，24 年。

At this point, I'd like to turn the call over to David for his comments on our financial performance. I will then return and give my thoughts on unlocking value photomasks that, David?

現在，我想將電話轉給大衛，請他對我們的財務表現發表評論。然後我會回來並給出我對解鎖有價值的光掩模的想法，大衛？

Thank you, Eric. I will begin my comments with a recap of full year 2023 during the course of which I will present important metrics for Q4 as well as working capital and liquidity analysis.

謝謝你，埃里克。我將首先回顧 2023 年全年情況，在此期間我將介紹第四季度的重要指標以及營運資本和流動性分析。

As you will see from slide 8 our overall sales for the full year declined by about 5% from $610 million to $579 million for the reasons that Eric has already outlined, you can see from the graphic depiction that US crop with the unavailability of Aztec in the first half of the year and actually for most of the year declined by 7%, while both US non-crop and international declined modestly during the fourth quarter.

正如您從幻燈片8 中看到的那樣，我們全年的總銷售額下降了約5%，從6.1 億美元下降到5.79 億美元，原因埃里克已經概述了，您可以從圖形描述中看到，由於阿茲特克的缺貨，美國的作物在今年上半年乃至全年大部分時間下降了 7%，而第四季度美國非農作物和國際作物均小幅下降。

With respect to US non-crop, we are observing a more stable sales trend following the destocking effort. The efforts of retailers that began in the beginning of 2023.

就美國非農作物而言，我們觀察到去庫存努力後銷售趨勢更加穩定。零售商的努力始於 2023 年初。

With regard to international, the bar graph tends to bear out the fact that oversupply of generic products did not materially affect our business in the regions that we serve.

就國際而言，長條圖往往證實了這樣一個事實：仿製藥供應過剩並未對我們所服務地區的業務產生重大影響。

Turning to slide 9, with a sales decline of 5%, our gross gross profit declined by about 7% and gross margin percentage decreased from 32% to 31% year over year. As you may know, for our US crop business carries our highest margin product, many of which we manufacture in our factories. The drop in sales of high margin products such as our semiconductor wouldn't necessarily put pressure on gross margins, as you will see on slide 10, our operating expenses in 2023 edged up about to about $156 million from about $151 million in 2022. This was due to increased selling expenses, both in South America to support our new business in Ecuador, the largest banana growing country in the world and increased travel, coupled with additional R&D and regulatory costs, which represents the continued investment in our future with the concurrent defense of our registrations. These increases were partially offset by a decrease in G&A expense, largely due to reduced incentive compensation as a result of overall financial performance.

轉向幻燈片 9，銷售額下降 5%，我們的毛利下降約 7%，毛利率比去年同期從 32% 下降至 31%。如您所知，我們的美國農作物業務提供了利潤率最高的產品，其中許多產品是我們在工廠生產的。我們的半導體等高利潤產品的銷售下降並不一定會對毛利率造成壓力，正如您在幻燈片10 中看到的那樣，我們2023 年的營運費用從2022 年的約1.51 億美元微升至約1.56 億美元。這是由於在南美洲的銷售費用增加，以支持我們在世界上最大的香蕉種植國厄瓜多爾的新業務，以及旅行的增加，再加上額外的研發和監管成本，這代表著我們對未來的持續投資同時捍衛我們的註冊。這些成長被一般管理費用的減少部分抵消，這主要是由於整體財務表現導致激勵薪酬減少。

With respect to cash flow, as per Slide 11, despite the negative change in working capital, which occurred due to slower sales and expansion of working capital, primarily driven by the accumulation of inventory. We closed the year with net debt of $128 million. I will cover liquidity in a few moments.

就現金流而言，根據投影片 11，儘管營運資本出現負變化，這是由於銷售放緩和營運資本擴張（主要是由庫存累積驅動）造成的。今年結束時，我們的淨債務為 1.28 億美元。稍後我將討論流動性。

Looking at our statement of operation on slide 12, you will note that our drop in sales with slightly higher OpEx translated into lower operating income, lower income before tax, lower income tax and the consequent net income of about $7.5 million or $0.26 per share. Bear in mind, as Eric has intimated for the first three quarters of 2023, we generated very little net income. That's what you're seeing on Slide 12. As far as net income and EPS search is concerned, generally it was generated in Q4 Turning now to working capital on slide 13, you will see our inventory trend on a quarterly basis since 2021. Note that as compared to 2022, we took a step up in inventory during 2023 there, again, with unavailability of certain key products and lower demand due to destocking in the distribution channel, we ended up accumulating inventory at the start of the year, we turned the corner in Q4 as more normalized market conditions returned at 38% of net sales. Our ending inventory is higher than we would like we are targeting to get inventory levels down to $195 million by the end of 2024.

查看投影片12 上的營運報表，您會注意到，我們的銷售額下降以及營運支出略高，導致營業收入下降、稅前收入下降、所得稅下降，以及隨之而來的淨利潤約750 萬美元或每股0.26 美元。請記住，正如艾瑞克（Eric）所暗示的那樣，2023 年前三個季度我們的淨利潤非常少。這就是您在投影片 12 上看到的內容。就淨利潤和每股收益搜尋而言，一般是在第四季度產生的。現在轉向幻燈片 13 上的營運資本，您將看到我們自 2021 年以來的季度庫存趨勢。請注意，與 2022 年相比，我們在 2023 年的庫存有所增加，同樣，由於某些關鍵產品缺貨以及分銷渠道去庫存導致需求下降，我們最終在年初積累了庫存，我們隨著市場狀況恢復正常，佔淨銷售額的38%，第四季出現了改善。我們的期末庫存高於我們的目標，即到 2024 年底將庫存水準降至 1.95 億美元。

Now let's take a quick look at debt and liquidity as the slide 14 daily strain that was apparent in the first nine months of 2023 took a turn for the better in the fourth quarter. While we recorded a significant drop in borrowing from $218 million in Q. three to $139 million in Q4 and a concomitant increase in borrowing capacity from $29 million to $115 million end numbers are approaching historical averages. However, with our targeted performance in 2024, we would expect to have an even stronger liquidity position at the year end. That sums up my detailed comments on the whole, while 2023 started quite slowly in the face of adverse market supply conditions I'm pleased with the progress that we made in Q4 during which we significantly improved the balance sheet. This gives us a great foundation to 2024 and beyond. With that, I'll turn the call back to Eric. Erik.?

現在，讓我們快速瀏覽一下債務和流動性，因為 2023 年前 9 個月明顯的 14 日幻燈片壓力在第四季度出現好轉。雖然我們的借款從第三季的 2.18 億美元大幅下降至第四季的 1.39 億美元，借款能力隨之從 2,900 萬美元增加到 1.15 億美元，但最終數字已接近歷史平均水準。然而，根據我們 2024 年的目標業績，我們預計年底的流動性狀況將更加強勁。這總結了我對整體的詳細評論，雖然面對不利的市場供應狀況，2023 年開局相當緩慢，但我對我們在第四季度取得的進展感到滿意，在此期間我們顯著改善了資產負債表。這為我們邁向 2024 年及以後奠定了良好的基礎。說完，我會把電話轉回給艾瑞克。埃里克。？

Thank you, David. Let me now turn to the fourth part of my comments, namely unlocking American Vanguard's full potential as seen on Slide 15. You may recall in our January call, the Co-stream capital has been in effect.

謝謝你，大衛。現在讓我談談我的評論的第四部分，即釋放美國先鋒隊的全部潛力，如幻燈片 15 所示。您可能還記得在我們一月的電話會議中，Co-stream 資本已經生效。

Will it go after years of return to more normalized historic performance?

經過多年的恢復，它會恢復到更正常的歷史表現嗎？

What's next? Similarly, one of our analysts pose the question, though, but we will unlock some value that is inherent in the company as discussed the answer on slide 16, along with our advisor clients, our team is driving and business transformation initiative to improve operating leverage and move adjusted EBITDA to 15% of net sales by 2026. We call the process of defining the target Pathfinder. As you see on the slide, this initiative should translate into $15 million or more in additional EBITDA on an annualized basis. This is not a new endeavor as you may recall, we announced a transformation initiative at the end of Q2 last year. At that time, we had also identified we could achieve a $15 million benefit through operational and commercial changes, but tires, health, we are validating the initial assessment and defining a plan by which to obtain this improvement on operating leverage.

下一步是什麼？同樣，我們的一位分析師提出了這個問題，但我們將釋放公司固有的一些價值，正如幻燈片16 中討論的答案一樣，我們的團隊正在與我們的顧問客戶一起推動業務轉型計劃，以提高營運槓桿到 2026 年，將調整後的 EBITDA 佔淨銷售額的 15%。我們將定義目標的過程稱為探路者。正如您在幻燈片中看到的那樣，這一舉措應可轉化為年化 1500 萬美元或更多的額外 EBITDA。您可能還記得，這並不是一項新的嘗試，我們在去年第二季末宣布了一項轉型計劃。當時，我們還確定可以透過營運和商業變革實現 1500 萬美元的效益，但輪胎、健康方面，我們正在驗證初步評估並製定一項計劃，以實現營運槓桿的改善。

As for Slide 17, we expect that about 60% of this benefit will come from operational changes in manufacturing planning, inventory and procurement, including freight fell 30%, will likely come from commercial areas such as pricing, sales expenses, product portfolio and R&D funding and another 10% will likely come out of G&A. We will implement these changes over the course of the next two years. And as I said, we should realize the full benefits in 2026. In short, we will be applying the sound business principles to all that we do with the intention of returning value to our shareholders as our first priority.

至於投影片 17，我們預計約 60% 的收益將來自製造規劃、庫存和採購方面的營運變化，其中運費下降 30%，可能來自定價、銷售費用、產品組合和研發等商業領域資金和另外10%可能來自G&A。我們將在未來兩年內實施這些變革。正如我所說，我們應該在 2026 年實現全部效益。簡而言之，我們將把合理的商業原則應用到我們所做的一切中，以向股東回報價值作為我們的首要任務。

Turning to Slide 18.

轉到投影片 18。

As part of the transformation in this, we are reassessing our working capital allocation within that respect. Grocery growth platforms or in solutions and I'll pause to note that with respect to our core business, our two continues to launch new formulations. Inventions, for example, are they low and vintage herbicide, the dominant brand solutions reported a 10% increase in sales year-over-year with new products like BioWare lubricant. That has been good critically on so far.

作為轉型的一部分，我們正在重新評估這方面的營運資本分配。雜貨成長平台或解決方案，我要停下來指出，就我們的核心業務而言，我們兩家公司繼續推出新配方。例如，在低效老式除草劑發明方面，主導的品牌解決方案報告稱，BioWare 潤滑劑等新產品的銷售額比去年同期增長了 10%。到目前為止，這一點在批評上一直很好。

And now we've passed our first foreign person by over 30% integration with Zendesk. We have validated this technology and proven clinical functionality issues with both solid and liquid inputs.

現在，我們與 Zendesk 的整合已經超過了第一個外國人 30%。我們已經驗證了這項技術，並證明了固體和液體輸入的臨床功能問題。

Is there some potential and both there was and Brazil markets and most recently as its yield enhancement tool and field trials volume prescriptive versus conventional applications. Sunpower's platform is really our prime portfolio is continuing to increase at this stage of maturity we expect that we will incur reduced development cost for some paths going forward and are now positioned to capitalize on market demand as grower and appetite for equipment and prescriptive application technology.

是否有一些潛力，以及巴西市場和最近作為其增產工具和現場試驗量與傳統應用相比的規定性。Sunpower 的平台確實是我們的主要產品組合，在現階段的成熟度中，我們預計我們將降低某些發展路徑的開發成本，並且現在已做好充分利用市場需求的增長以及對設備和規範應用技術的興趣的準備。

And Chris, in closing, we have a solid business with a strong balance sheet, broad geographical reach and three growth platforms. We are poised to return to greater profitability in the short-term and with our initiatives to unlock American Vanguard's full potential, we are investing and returning greater value to shareholders. This is an exciting time for the Company. And again, we thank you for your continued interest and support.

最後，克里斯表示，我們擁有穩健的業務、強大的資產負債表、廣泛的地理覆蓋範圍和三個成長平台。我們準備在短期內恢復更大的獲利能力，並透過我們釋放美國先鋒集團全部潛力的舉措，我們正在投資並為股東回報更大的價值。對於公司來說，這是一個令人興奮的時刻。我們再次感謝您一直以來的關注與支持。

With that, I'll turn it back to the operator for any questions. Diego?

這樣，如果有任何問題，我會將其轉回給接線員。迭戈？

Thank you, sir.

謝謝你，先生。

And at this time, we'll conduct our question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star two. If you would like to remove your questions from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please while we poll for question. And our first question comes from Scott Fortune with Roth MKM. Please state your question.

此時，我們將進行問答環節。如果您想提問，請按電話鍵盤上的星號一。確認音將表示您的線路已在問題佇列中。您可以按星二號。如果您想從佇列中刪除您的問題。對於使用揚聲器裝置的與會者，可能需要在按星號鍵之前拿起聽筒。請稍等一下，我們進行投票提問。我們的第一個問題來自 Scott Fortune 和 Roth MKM。請說出你的問題。

Good afternoon and thanks for the questions here from one and step two, I know you're kind of focusing on looking at the growth platforms going forward here, and you've highlighted that for the near term. I just want to get a sense for now where I guess specifically focusing on 10 path and the confidence there, this really starting to get the take the adoption where you're at as far as numbers and passes in the field now and in that ramp of you mentioned new products and productions for this impact going forward here, just kind of step us through as you look out over the next couple of years, the opportunity set that is taking a while to get here. But the opportunity now for that going forward would be helpful.

下午好，感謝第一步和第二步提出的問題，我知道您有點關注這裡未來的成長平台，並且您已經強調了近期的這一點。我現在只是想了解一下，我想特別關注 10 條路徑和那裡的信心，這真的開始得到採用，就你現在在現場和坡道上的數字和通行證而言，這真的開始得到採用你們中的有些人在這裡提到了針對這種影響的新產品和新產品，當你們展望未來幾年時，請向我們介紹一下，需要一段時間才能實現的機會集。但現在的機會將會很有幫助。

Yes.

是的。

And as far as the numbers, we're still we're still delivering equipment now, but I think we're somewhere in that 200.

就數字而言，我們仍在交付設備，但我認為我們已經在 200 台左右了。

What are the systems that are that are in place, frankly.

坦白說，現有的系統是什麼？

And as you know, we're growing our platforms. We did get some have some approvals from EPA for this season that we were looking for. We are we have some collars that we've got chewed up for '25 that we think we think we'll have them in place. One of the things we really completed in '23 and have just got to have received the results from was specifically with Keller was a prescriptive application with themselves and it was kind of average 10 to 12 bushels increase.

如您所知，我們正在發展我們的平台。我們確實得到了美國環保局（EPA）對本賽季我們正在尋找的一些批准。我們有一些25年的項圈，我們認為我們會把它們安裝到位。我們在 23 年真正完成並剛剛收到結果的一件事是專門與凱勒一起進行的規定性應用，平均增加了 10 到 12 蒲式耳。

Most areas where nematode pressure was present. And then we also tested product to see where there wasn't nematode pressure and found what you might expect was it will benefit.

大多數地區有線蟲壓力。然後我們還測試了產品，看看哪裡沒有線蟲壓力，並發現您可能期望它會受益。

So model now mapped out the different fields.

所以模型現在映射了不同的字段。

And we've seen the results that we would expect from prescriptive application.

我們已經看到了規範應用所期望的結果。

Somebody was saying, and I'm not just jumped over my line, but we're modeling on soil type as well as current inventory count.

有人說，我不僅跳過了我的界限，而且我們正在根據土壤類型和當前庫存數量進行建模。

As Mike mentioned, Sandy soil has the highest level of Scentre Group platform for Therma-Tru with enzyme.

正如 Mike 所提到的，沙土擁有最高水準的 Scentre Group 酵素 Therma-Tru 平台。

We also found that there are certain soil types were for zinc deficiency is an issue.

我們也發現某些土壤類型有缺鋅問題。

And we've seen, again, 13 type increase in personal auto partner jet, which is relatively relatively inexpensive compared to the insecticide application. We think we've got some potential value on on-site hiring, which didn't we didn't have not figured out exactly where the benefits are, at least for the thousand acres that we have. So because it is so far this process has been Benson growers through third round of us to write prescriptively and you don't the demonstrated return on investment is kind of what was important, pardon Brazil, did that material out and cover some of the bleed this year?

我們再次看到個人汽車伴侶噴射機增加了 13 種，與殺蟲劑應用相比，這種飛機相對便宜。我們認為現場招募具有一定的潛在價值，但我們還沒有弄清楚到底有什麼好處，至少對我們擁有的一千英畝土地來說是如此。因此，因為到目前為止，這個過程已經是本森種植者通過第三輪我們制定的規定，但你不知道所展示的投資回報是重要的，請原諒巴西，是否將這些材料拿出來並覆蓋了一些出血今年？

Canada is a big upside for us there because it is registered, not only or but also sorry, please go to Slide 4 for some pass and adoption time moving forward, we are looking to ramp up best.

加拿大對我們來說是一個很大的優勢，因為它已經註冊了，不僅如此，而且抱歉，請轉到幻燈片 4 了解未來的一些通行證和採用時間，我們希望能做到最好。

Okay.

好的。

Appreciate that color. And then one more for me. Just kind of step into the transformation plan and you've kind of unpack that a little bit. You're going to provide more color on the KTI.s and targets a focus and for that but just wanted a clarification. The additional savings, additional of $50 million on that cadence, you mentioned time line through 2026 to fully optimize all that. Is that $15 million on annualized basis or that's going to be taken over time through through '26. Just kind of clarification there. And then just kind of core, we'll give more color on the transformation plan around the KPIs that you guys are suggesting.

欣賞那個顏色。然後再給我一張。只要踏入轉型計劃，你就可以稍微解開它。您將在 KTI.s 上提供更多顏色並確定焦點，但只是想澄清一下。額外的節省，按照這個節奏額外節省 5000 萬美元，您提到了到 2026 年全面優化這一切的時間表。這 1500 萬美元是按年計算的還是將在 26 年之前逐步支出。只是澄清一下。然後，作為核心，我們將圍繞你們建議的關鍵績效指標 (KPI) 為轉型計劃提供更多色彩。

So so what we did is kind of looked looked at' 24 and said, what's our gap to get into 15% and has no '24 had it improvements that we've baked into it and came up with this gap of 15, 15, 17 miss.

所以我們所做的就是查看 24 並說，我們進入 15% 的差距是多少，沒有 24 進行了改進，我們已經融入其中並得出了 15、15 的差距， 17小姐。

And so when harnesses delivering for us is creating that, that that pathway that we said to get into getting us to that level. So what we identified in the 24, there should be opportunities to expand that number in '25, '26 with the target again of moving, we'll bring us up to getting to that [50%] of net sales. So obviously, we expect '25 and '26 to grow and therefore to say a few more, but you're tying into the year that you have in front of us to 2024. And with regard to KPI.'s, Dan, if you want to just highlight kind of where we're at with our JPI.s well, converged on the team now kind of I think you are getting ready to to get them to kind of put those in place.

因此，當利用工具為我們提供服務時，我們就創造了一條我們所說的讓我們達到那個水平的途徑。因此，我們在 24 年中確定，應該有機會在 25 年、26 年擴大這一數字，目標再次移動，我們將使我們達到淨銷售額的 [50%]。顯然，我們預計 25 和 26 會成長，因此要多說幾句，但你將把我們面前的這一年與 2024 年聯繫起來。關於 KPI，Dan，如果您只想強調我們在 JPI 方面的進展情況，那麼現在就集中在團隊上，我認為您已經準備好讓他們達成一致將這些落實到位。

We are.

我們是。

Thanks, Eric, and thank you for the questions, the dongle day. So on KPI. as we are looking at both financial and operational KPIs, the financial ones are certainly the ones that you would expect gross margin dollar performance of the business as a whole EBITDA and varying forms of operating expenses. Now we take those and then we want to push those out into the business units. Those are that's done normally and always through the budgeting process. And then we want to go one double-click further on that. And then cascade those business unit targets down into key roles so that each individual that is that has a responsibility for driving the performance of the business knows exactly what their targets are. Again, this is not new into the business and we've done that historically, but we haven't necessarily done it as thoroughly as we're going to do it in this past.

謝謝艾瑞克，也謝謝你在加密狗日提出的問題。那麼關於KPI。由於我們同時關注財務和營運 KPI，因此財務 KPI 肯定是您期望企業整體 EBITDA 的毛利率美元表現和各種形式的營運費用的 KPI。現在我們接受這些，然後我們想將它們推入業務部門。這些都是通常透過預算流程完成的。然後我們想進一步雙擊它。然後將這些業務部門目標分解為關鍵角色，以便負責推動業務績效的每個人確切地知道他們的目標是什麼。再說一次，這對這個行業來說並不是什麼新鮮事，我們歷史上也這樣做過，但我們不一定像過去那樣徹底地做到這一點。

And another type of KPI is the are the operational KPIs. So some raw materials were manufacturer. So the raw material efficiency is very important for our business and is a lever of driving profitability. So we are going to do we're going to have a an approach for how we measure the raw material efficiency in the business. And it already is part of our continuous improvement process to get better in that regard, but marrying up those KPI.'s across our top, say, 10 products and a continuous improvement effort allows us to know where we need to be focusing more of our attention on. There's also improvements that we're seeking to make on forecasting both on the manufacturing side and the commercial side of the business. So making sure that we're manufacturing to the plans that we intend and that those plans are informed by the commercial forecasts of the business. And those are some examples of KPI.s that we're working on.

另一種類型的 KPI 是營運 KPI。所以有些原料是製造商。因此，原料效率對我們的業務非常重要，是推動獲利的槓桿。因此，我們將採取一種方法來衡量業務中的原材料效率。它已經成為我們持續改進流程的一部分，以在這方面取得更好的成績，但是將這些KPI 與我們的頂級產品（例如10 個產品）和持續改進工作結合起來，使我們能夠知道我們需要更多地關注哪些方面我們的關注。我們也尋求在製造方面和商業方面的預測方面做出改進。因此，請確保我們按照我們預期的計劃進行製造，並且這些計劃以業務的商業預測為依據。這些是我們正在研究的 KPI 的一些範例。

And then also, as I said, driving these KPI.s to the business units and from the business units into those key stakeholders, the roles that the organizations that are responsible for each one of those, not something necessarily that's new, but certainly much more exhaustive process. And we and it is something that Eric just mentioned and that I'm working on with the presidents of the business presidents.

然後，正如我所說，將這些 KPI 推向業務部門，並從業務部門推向關鍵利益相關者，負責其中每一項的組織的角色，不一定是新的，但肯定是很多更詳盡的過程。我們以及艾瑞克剛才提到的事情，我正在與商業總裁的總裁合作。

Okay.

好的。

Appreciate.

欣賞。

And then one last quick one for me. Sorry about that, but just wanted to provide a little bit color. I know you said the different geographies, the U.S. is doing well here and you mentioned much in Latin America, just kind of unpack 2024 as some of the pressures still remain in South America and Latin America, which does affect you as much. But just kind of help us understand the strengths in different geographies and where there might be some pressure still.

然後是我的最後一個快速的。對此感到抱歉，但只是想提供一點顏色。我知道你說過不同的地區，美國在這裡表現良好，你提到了拉丁美洲的許多情況，只是對2024 年進行了一些分析，因為南美洲和拉丁美洲仍然存在一些壓力，這確實對你產生了同樣大的影響。但這只是幫助我們了解不同地區的優勢以及可能仍有壓力的地方。

And so Mexico saw a very solid. Certainly there is generic pressure in all of the markets. But we do have we do have some kind of unique in it products into Mexico. And yes, there was there were inventories. I mean, particularly kind of globally.

所以墨西哥看到了非常堅實的基礎。當然，所有市場都存在著普遍的壓力。但我們確實有一些獨特的產品進入墨西哥。是的，有庫存。我的意思是，特別是在全球範圍內。

If you look at the broad broad, the broad application of herbicide, probably a big plus, there were certain insecticides that I think were loaded up.

如果你看看除草劑的廣泛應用，這可能是一個很大的優勢，我認為某些殺蟲劑被大量使用。

Another will go into the generic world on Central America, we probably had more generic pressure there where we saw products as the Chinese price of a lot of the commodity products came down. We saw some pressure certainly on the inventories that they had and not as much in Brazil because Brazil, we have a we have predominantly it was kind of a fruit and veggie business that expanded into corn and soybeans with calendar, and they're not not sitting with Virgin or generic pressure as much from a timing standpoint, the destocking that that I think was universal has been virtually everything.

另一個將進入中美洲的通用世界，我們在那裡可能面臨更大的通用壓力，因為許多商品的中國價格下降了。我們確實看到了他們的庫存面臨一些壓力，但在巴西卻沒有那麼大，因為巴西我們主要是水果和蔬菜業務，透過日曆擴展到玉米和大豆，他們不是沒有從時間的角度來看，承受著維珍或通用汽車的壓力，我認為普遍的去庫存幾乎已經涵蓋了一切。

And really a lot of people were government are watching inventory situation. But again, as you said, you know, and with Brazil, that's kind of new, of course, that gets to your question.

政府確實有很多人在關注庫存狀況。但正如你所說，你知道，對巴西來說，這當然是一種新的情況，這也涉及到你的問題。

Thank you for your questions.

謝謝您的提問。

And our next question comes from Chris Kapsch with Loop Capital Markets. Please state your quest.

我們的下一個問題來自 Loop Capital Markets 的 Chris Kapsch。請說出你的追求。

Yes, hi. Good afternoon all. With a few questions.

是的，嗨。大家下午好。有幾個問題。

One.

一。

So one regarding the outlook for 2024. And given what you had these two key products affect Octel and that were impacted by the absence of availability I've come after this last year. I'm just curious about what the expectation is for those products baked into your overall '24 expectation. Is that would you expect just a normal demand environment? Or will you see outsized growth come because of restocking? Have those products throughout the channel in '24? Any color there?

這是關於 2024 年的展望。考慮到這兩個關鍵產品對 Octel 的影響，以及我去年之後出現的可用性缺失的影響。我只是好奇您對 24 世紀整體期望中的那些產品的期望是什麼。您所期望的只是正常的需求環境嗎？或者您會看到由於補貨而帶來的大幅增長嗎？24 世紀這些產品是否已遍佈整個通路？那裡有什麼顏色嗎？

So well, I mean, we started selling assets in Q3 and Q4.

好吧，我的意思是，我們在第三季和第四季開始出售資產。

So part of that was building back some inventories because inventories were down 5% or somewhere in that range. So we did have good demand and we continue to have good demand. Now as the season is unfolding, we're not we're not seeing an inventory build, so we would expect to have a strong second half of the year as well.

因此，其中一部分是恢復了一些庫存，因為庫存下降了 5% 或在該範圍內。所以我們確實有很好的需求，而且我們仍然有很好的需求。現在，隨著季節的展開，我們並沒有看到庫存增加，因此我們預計下半年也會有強勁的表現。

And that goal was good.

這個目標很好。

It's pretty much completely gone. We did we do have ongoing orders to kind of fill all the orders.

它幾乎完全消失了。我們確實有持續的訂單來滿足所有訂單。

Yes, but we did we have been supplying between fourth quarter and first quarter, a fair amount of we are expecting the demand does. It does look strong going forward, product was growing for us and so help us, which certainly so far. So I think we're looking at compliance points of prices for that.

是的，但我們確實在第四季度和第一季之間一直在供應，我們預計需求量很大。未來看起來確實很強勁，產品對我們來說正在成長，因此對我們有幫助，到目前為止肯定是如此。所以我認為我們正在考慮價格的合規點。

As far as the pressure, I think as time is kind of a key product for pressure is heavy. And so for you where you have grown repro, I guess with the corn rootworm pressure that's in the field.

就壓力而言，我認為時間是一種關鍵產品，因為壓力很大。因此，對於您種植繁殖的地方，我想是由於田間玉米根蟲的壓力。

Got it. That's helpful.

知道了。這很有幫助。

And then on the PATHFINDER and there our focus on, I guess, 15% EBITDA margin 2026. Curious if those if that bogey, if you will, is based on the portfolio as it exists today? Or is there any instances where you're looking at a product line or a suite of products that you just structurally?

然後是 PATHFINDER，我猜我們的重點是 2026 年 EBITDA 利潤率為 15%。好奇那些如果那個柏忌的話，如果你願意的話，是基於今天存在的投資組合嗎？或者是否有任何情況下您正在尋找您只是在結構上的產品線或一套產品？

I can't see it getting there and therefore might be subject to, I don't know, rationalization or is this sort of improvement expected to be kind of across the portfolio by '26?

我看不到它能實現這一點，因此可能會受到（我不知道）合理化的影響，或者這種改進預計會在 26 年之前在整個投資組合中出現？

We're not baking and we did not bake any acquisitions per se into the model.

我們沒有烘焙，也沒有將任何收購本身烘焙到模型中。

And we do have our kind of ongoing projects that create that we do in our core business, both through licensing and combination products that host us part of that.

我們確實有一些正在進行的項目，這些項目創造了我們在核心業務中所做的事情，無論是透過授權還是組合產品來承載我們的一部分。

And of course, as we expand the products and the portfolio for some past, those are there, those are those are targets that we've identified and going forward for the next next couple of years. But as I said, we're not we did not bake acquisitions into Apollo.

當然，隨著我們過去擴展產品和產品組合，這些都是我們已經確定並在未來幾年內前進的目標。但正如我所說，我們並沒有將收購納入阿波羅計畫。

We'll just have a follow up what about rationalizing products, meaning like just products that are lower margin dragging on the overall mix. And so I don't really see a pathway to get to that or to help the overall Company get to the 15%? And then what and then what also is embedded in sort of the growth rate of your the more novel growth platforms? And maybe just more generally, what when might you expect to kind of update the growth targets for those products, 3D sensing?

我們將跟進產品合理化的情況，這意味著利潤較低的產品會拖累整體組合。所以我真的沒有看到實現這一目標或幫助整個公司達到 15% 的途徑？那麼，您的更新穎的成長平台的成長率還包含什麼？也許更一般地說，您預計什麼時候更新這些產品（3D 感測）的成長目標？

So So with regard to product rationalization, yes, I mean, we are as part of of what we're identifying we're identifying quality of business return on working capital. And so those products that do have lower margins, our move to emphasize the way we want to focus our team on our higher margin products and those those with us that is part of that of process bill, of course, improvement into solar manufacturing outputs us far, as you usual and then combine that with with that, of course, working on purchasing power to lower our cost of goods, it was now a pretty good time as we saw prices spike pointed to the pandemic and we are seeing a softening back on auto-enrolment is for core intermediates that we use. And that is that that's part of improving our margins as well.

因此，關於產品合理化，是的，我的意思是，我們正在確定營運資本業務回報品質的一部分。因此，那些利潤率較低的產品，我們的舉措是為了強調我們希望我們的團隊專注於利潤率較高的產品以及那些與我們合作的產品，這些產品是製程清單的一部分，當然，太陽能製造產量的改進我們到目前為止，像往常一樣，當然，將其與購買力結合起來，努力降低我們的商品成本，現在是一個非常好的時機，因為我們看到價格飆升表明了這一流行病，而且我們看到了經濟回軟自動註冊適用於我們使用的核心中間體。這也是提高我們利潤的一部分。

With regard to, yes, as far as the growth platforms where we are, we've done an initial pass with that as far as over the next couple of years. We do want to get through this process with finding kind of identify what and just as we're talking about some rationalization, if that's what it is, how we improve, as I mentioned, and the 60% covenant of that income come from the operational side and then 30% maybe from the commercial side. And once we once we bake that in and put clearer direction on that one, there the position to assess Paloma effects, digital three platform.

是的，就我們所在的成長平台而言，我們已經在未來幾年內完成了初步的審查。我們確實希望透過這個過程找到某種確定性，就像我們正在談論一些合理化一樣，如果是這樣的話，我們如何改進，正如我提到的，該收入的 60％ 的契約來自於運營方面，然後30 % 可能來自商業方面。一旦我們將這一點納入考慮並為其製定更明確的方向，就可以評估帕洛瑪效應、數位三平台。

Got it.

知道了。

That's helpful. And then the last one for me just is related to sort of the industry issue that that's been seems like it's becoming pretty acute for us or leaves some uncertainty. And that is around the herbicide dicamba. And the fact that EPA is registration is could be, you know, I guess up in the air or uncertain given the lawsuit. And I guess there's the ability for various uses this year, but next year is in jeopardy, I suppose so. So I don't know if you have a view about how that may play out, Eric, and what the implications might be, if I'm yes, that's fair further. And if there's further restrictions on dicamba, does that represent any opportunity straight?

這很有幫助。對我來說，最後一個問題與某種行業問題有關，這個問題對我們來說似乎變得非常尖銳，或者留下了一些不確定性。這就是除草劑麥草畏的情況。考慮到這起訴訟，我認為美國環保署是否註冊這一事實可能是懸而未決的或不確定的。我想今年有各種用途的能力，但明年就處於危險之中，我想是這樣。所以我不知道你是否對這可能會如何發展有看法，埃里克，以及可能產生的影響，如果我是的話，那就更公平了。如果對麥草畏有進一步的限制，這是否意味著任何機會？

You did?

你做到了嗎？

Thank you.

謝謝。

Yes, from a from a dicamba side in the marketplace, I think it's up to the sort of basics that have platforms on dicamba to decide whether they want to challenge that ruling. So that would be a decision for the quarter should be a fair amount of support for the for that challenge, but nothing that we wouldn't really be involved in.

是的，從市場上的麥草畏方面來看，我認為這取決於擁有麥草畏平台的基礎人士來決定他們是否想要挑戰這項裁決。因此，本季的決定應該是對這項挑戰的相當大的支持，但我們不會真正參與其中。

And from an opportunity standpoint, we mentioned I mentioned the low end, our other kind of herbicides that we put together our Sinead, which is kind of two grams on bus velocity. And we're ramping up our portfolio of cover herbicides. We have such a benchmark there.

從機會的角度來看，我們提到了低端，我們將 Sinead 放在一起的另一種除草劑，總線速度為 2 克。我們正在擴大我們的覆蓋除草劑產品組合。我們那裡有這樣一個基準。

But Bob, maybe from your side?

但是鮑勃，也許是你這邊的？

Yes, I think that the opportunities being discussed with customers now to news is pretty recent. We're in the middle of the season. So there will be really just a 2025 discussion and as crop season ends. One of our key initiatives as far as innovation has been our press release, formulation technology, which is in silo and allows a good solid solution into windows of herbicide resistance, but also if technologies like dicamba do not survive the regulatory process. So we'll open up a window for index technology.

是的，我認為現在與客戶討論新聞的機會是最近才出現的。我們正處於賽季中期。因此，實際上只會在 2025 年作物季節結束時進行討論。就創新而言，我們的關鍵舉措之一是我們的新聞稿、配方技術，該技術處於筒倉狀態，可以為除草劑抗性窗口期提供良好的固體解決方案，但如果像麥草畏這樣的技術無法通過監管流程，也是如此。那我們將為索引技術打開一扇窗。

Got it.

知道了。

And so just the one quick follow-up on that, Bob, appreciate the Prolieve that formulation, I mean, is that the one that's associated with that or different chemistry?

因此，鮑勃，對此的一個快速後續行動，請欣賞 Prolieve 該配方，我的意思是，這是否與該化學反應或不同的化學反應相關？

and so that's the one that comes out of our formulations team here in California. It's a technology where we can put multiple chemistries together with the basic chemistry of two phosphate ammonia and stabilize it and deliver it to the to the end user. It broadens the <unk> the acre opportunity for us as far as value extraction and it targets any resistant weed issues that the grower may have as far as timing, it enhances his ability to be more flexible as far as application. So it's something that we're very, very excited about going forward. And we have a family of products that are coming with that basic formulation technology, it was

這就是我們加州配方團隊的成果。在這項技術中，我們可以將多種化學物質與二磷酸氨的基本化學物質結合在一起，並穩定並將其交付給最終用戶。就價值提取而言，它為我們拓寬了英畝的機會，就時機而言，它針對種植者可能遇到的任何抗性雜草問題，它增強了他在應用方面更加靈活的能力。因此，我們對此感到非常非常興奮。我們擁有一系列採用基本配方技術的產品，它是

(multiple speakers) Okay.

（多個發言者）好的。

We can take the different chemistries that don't don't mix well together of like oil and water having. And yes, having a grid supplier, the suspense for a long duration period of time. So that's been that's been a drawback of a number of them.

我們可以採用不能很好地混合在一起的不同化學物質，例如油和水。是的，擁有電網供應商，是很長一段時間的懸念。這就是他們中的一些人的缺點。

Products is just compatibility with other with other products guy, and this one is sort of tenor and goes back to maybe a time by. Thank you.

產品只是與其他產品相容，而這個是一種基調，可以追溯到很久以前。謝謝。

Correct, the fascinating, but we see potential other uses also.

正確，令人著迷，但我們也看到了潛在的其他用途。

Thank you.

謝謝。

Thank you.

謝謝。

Just a reminder to the audience to ask a question at this time, press star one on your touchtone phone to remove yourself from the queue, please.

只是提醒觀眾此時提問，請按按鍵式電話上的星號一將自己從佇列中刪除。

Our two, our next question comes from Andrew Lester with Hartley capital.

我們的兩個，我們的下一個問題來自哈特利資本的安德魯萊斯特。

Please state your question.

請說出你的問題。

Hi. Thanks for taking the question. Bob, it last quarter was light of different market conditions. The Company had to borrow a bank debt. That is what would be and sort of short-lived in light of better results. Could you state how much of that debt has presently been repaid and how quickly you expect to be able to pay down the balance?

你好。感謝您提出問題。鮑勃，上個季度是考慮到不同的市場狀況。公司不得不借入銀行債務。考慮到更好的結果，這將是短暫的。您能否說明目前已償還多少債務以及您預計能夠多快償還餘額？

Thank you.

謝謝。

So yes, you could say that, okay, you know, so there's an extension to that, that multiple functions defense did have four just three of them. With other words, there's 2.75 targeted this amendment covenants were for the year and has kind of graduated of that point the fruit, but we got 2.7% which we did and feel that we have to change that system.

所以是的，你可以說，好吧，你知道，所以有一個擴展，多功能防禦確實有四個，只有三個。換句話說，今年有 2.75 個目標是該修正案契約，並且已經取得了成果，但我們得到了 2.7%，我們做到了，並認為我們必須改變這個系統。

Okay.

好的。

And just a suggestion for the future. I know you released the news that the earnings call would come out via Bloomberg. I will just make a recommendation that it sort of more broadly be disseminated because it's very easy to miss for somebody who didn't have Bloomberg, whether it be Reuters, Dow Jones or Yahoo. Finance, something like that, I just think would be helpful for shareholders.

只是對未來的建議。我知道您透過彭博社發布了財報電話會議的消息。我只是建議更廣泛地傳播它，因為對於那些沒有彭博社的人來說很容易錯過它，無論是路透社、道瓊斯還是雅虎。我認為金融之類的東西對股東會有幫助。

Thank you.

謝謝。

(multiple speakers) For Brazil, Brazil and I don't know, David, if you wanted to add to that if I look at it.

（多名演講者）對於巴西，巴西，我不知道，大衛，如果我看看的話，您是否想補充這一點。

Thank you. And final reminder to ask a question, press star one on your cellphone will pause for a couple more to see there.

謝謝。最後提醒大家提問，按下手機上的星號一會暫停，以便更多人查看。

Any question, as there appears to be no additional requests for questions.

任何問題，因為似乎沒有其他提問請求。

I'll hand the floor back to Eric Wintemute for closing comments.

我將把發言權交還給埃里克·溫特穆特（Eric Wintemute）以供結束評論。

Thank you.

謝謝。

Okay.

好的。

We'll again appreciate everybody taking the time to to listen presentation again. As I said, it's an exciting time for us where we're making a lot of improvements in our organization and go forward. We feel very bullish about it about the outcome for '24 and beyond and look forward to giving you additional additional updates.

我們將再次感謝大家抽出時間再次聆聽示範。正如我所說，這對我們來說是一個激動人心的時刻，我們正在對我們的組織進行大量改進並繼續前進。我們對 24 年及以後的結果非常樂觀，並期待為您提供更多更新。

Page 4, which is a part of it as we get through Q1. And I appreciate the question and then your participation. Thank you very much.

第 4 頁，這是我們完成第一季時的一部分。我感謝您的提問以及您的參與。非常感謝。

Thank you.

謝謝。

That concludes today's call. All parties may disconnect.

今天的電話會議到此結束。所有各方都可以斷開連接。

Have a good.

有良好的。