CVD Equipment Corp (CVV) 2024 Q3 法說會逐字稿

Greetings. Thank you for standing by. Welcome to CVD Equipment Corporation's third quarter 2024 earnings call. As a reminder, this conference is being recorded. (Operator Instructions) Presenting on the call today will be Emmanuel Lakios, President and CEO and a member of CVD Board of Directors; and Richard Catalano, Executive Vice President and Chief Financial Officer. We have posted our earnings press release and call replay information to the Investor Relations section of our website at www.cvdequipment.com.

問候。謝謝你的支持。歡迎參加 CVD 設備公司 2024 年第三季財報電話會議。提醒一下，本次會議正在錄製中。（操作員說明）今天出席電話會議的是 CVD 董事會成員兼總裁兼執行長 Emmanuel Lakios；理查德·卡塔拉諾（Richard Catalano），執行副總裁兼財務長。我們已將獲利新聞稿和電話會議重播資訊發佈到我們網站 www.cvdequipment.com 的投資者關係部分。

Before I begin, I would like to remind you that many of the comments made on today's call contain forward-looking statements, including those related to future financial performance, market growth, total available market demand for our products and general business conditions and outlook. These forward-looking statements are based on certain assumptions, expectations and projections that are subject to a number of risks and uncertainties described in our press release and our filings with the SEC, including, but not limited to, the risk factors section of the company's 10-K for the year ended December 31, 2023. Actual results may differ materially from those described during this call. In addition, all forward-looking statements are made as of today, and we undertake no obligation to update any forward-looking statements based on new circumstances or revised expectations.

在開始之前，我想提醒您，今天電話會議上發表的許多評論都包含前瞻性陳述，包括與未來財務業績、市場成長、我們產品的可用市場總需求以及一般業務狀況和前景相關的陳述。這些前瞻性陳述是基於某些假設、預期和預測，這些假設、預期和預測受到我們的新聞稿和向SEC 提交的文件中描述的許多風險和不確定性的影響，包括但不限於公司的風險因素部分截至 2023 年 12 月 31 日止年度的 10-K。實際結果可能與本次電話會議中所述的結果有重大差異。此外，所有前瞻性陳述均截至今日作出，我們不承擔根據新情況或修改後的預期更新任何前瞻性陳述的義務。

I would now like to turn the call over to Emmanuel Lakios. Please go ahead, sir.

我現在想把電話轉給伊曼紐·拉基奧斯。請繼續，先生。

Operator, thank you, and good afternoon, everyone. Thank you all for joining us today to discuss our third quarter 2024 financial results and other important company developments and pertinent information related to our business. Your thoughts are important to us, and we look forward to your questions in our Q&A session.

接線員，謝謝您，大家下午好。感謝大家今天加入我們，討論我們 2024 年第三季的財務表現以及其他重要的公司發展以及與我們業務相關的相關資訊。您的想法對我們很重要，我們期待您在問答環節提出問題。

Our third-quarter 2024 revenue was $8.2 million, representing a 31.4% increase from prior year period and was up 29.1% as compared to our second quarter of 2024, while our year-to-date revenue of $19.5 million was 2.8% lower than the prior year period.

我們 2024 年第三季的營收為 820 萬美元，比去年同期成長 31.4%，比 2024 年第二季成長 29.1%，而我們年初至今的營收為 1,950 萬美元，比去年同期下降 2.8%。年期間。

We are pleased to have shipped a PVT200 system to a new account for our PVT product line during the third quarter. As we stated on our last call, this was a strategic order for silicon carbide 200-millimeter crystal boule growth, which we received in the first quarter of 2024. The performance of the system is currently being evaluated for production by our now second account.

我們很高興在第三季將 PVT200 系統運送到我們 PVT 產品線的新客戶。正如我們在上次電話會議中所說，這是我們在 2024 年第一季收到的碳化矽 200 毫米晶錠生長的策略訂單。我們現在的第二個帳戶目前正在評估系統的性能以進行生產。

Our orders for the third quarter were $4.1 million, primarily driven by demand in our CVD segment. Orders for the first nine months of 2024 were $21 million as compared to $19.9 million for the first nine months of 2023. We continue to see an ongoing recovery of our aerospace and defense market segment. In early November, we received a $3.5 million follow-on order for our CVI/CVD3500 system from an existing aerospace customer.

我們第三季的訂單為 410 萬美元，主要是由 CVD 領域的需求所推動的。2024 年前 9 個月的訂單為 2,100 萬美元，而 2023 年前 9 個月的訂單為 1,990 萬美元。我們繼續看到航空航太和國防市場領域的持續復甦。11 月初，我們從現有航空航太客戶收到了價值 350 萬美元的 CVI/CVD3500 系統後續訂單。

As a reminder, during our first quarter of 2024, we received a $10 million multisystem order in our industrial market from a company coating components with silicon carbide. We are encouraged that our backlog on September 30, 2024, was $19.8 million, which is 7.6% higher than our 2023 year-end backlog. The increase in revenue for the quarter supported an improvement in operating performance and system gross margin. This was unfortunately partially offset by a noncash charge for PVT150 inventory as the 150-millimeter silicon carbide market continues to show overcapacity and declining wafer price. As a result, the wafer producers are quickly transitioning to 200-millimeter production to stay competitive. We will continue to support, though, both our PVT150 and, of course, our PVT200 products.

提醒一下，在 2024 年第一季度，我們在工業市場上從一家使用碳化矽塗層組件的公司收到了價值 1000 萬美元的多系統訂單。令我們感到鼓舞的是，截至 2024 年 9 月 30 日，我們的積壓訂單為 1,980 萬美元，比 2023 年底積壓訂單高出 7.6%。本季營收的成長支持了營運績效和系統毛利率的改善。不幸的是，由於 150 毫米碳化矽市場繼續顯示產能過剩和晶圓價格下降，PVT150​​ 庫存的非現金費用部分抵消了這一影響。因此，晶圓生產商正在迅速轉向 200 毫米生產以保持競爭力。不過，我們將繼續支援我們的 PVT150​​，當然還有我們的 PVT200 產品。

Our order and revenue levels continue to fluctuate given the nature of the emerging growth end markets we serve. We'll stay the course on our strategic efforts to build critical customer relationships, achieve profitability, carefully manage our cash flow and our costs while simultaneously focusing on growth and return on investment.

鑑於我們所服務的新興成長終端市場的性質，我們的訂單和收入水準持續波動。我們將堅持我們的策略努力，建立關鍵的客戶關係，實現盈利，仔細管理我們的現金流量和成本，同時專注於成長和投資回報。

I would like to turn our call over to our CFO, Richard Catalano, who will provide an overview of our third quarter results.

我想將我們的電話轉給我們的財務長理查德·卡塔拉諾（Richard Catalano），他將概述我們第三季的業績。

Thank you, Manny, and good afternoon. As Manny mentioned, our revenue for the third quarter of 2024 was $8.2 million as compared to $6.2 million in the prior year quarter. It should be noted that the third quarter of 2023 did include revenue of $0.8 million that was recognized as a result of a modification of a customer contract during that quarter. The increase in revenues versus the prior year quarter was primarily attributable to higher revenue of $0.9 million from our CVD equipment segment, $0.4 million increase in revenue from our SDC segment and also an increase of $0.6 million from our CVD Materials segment as our MesoScribe subsidiary fulfilled its final orders.

謝謝你，曼尼，下午好。正如 Manny 所提到的，我們 2024 年第三季的營收為 820 萬美元，而去年同期的營收為 620 萬美元。值得注意的是，2023 年第三季確實包括因該季度客戶合約修改而確認的 80 萬美元收入。營收與去年同期相比的成長主要歸因於我們的CVD 設備部門的收入增加了90 萬美元，SDC 部門的收入增加了40 萬美元，以及我們的MesoScribe 子公司實現的CVD 材料部門的收入增加了60 萬美元它的最終命令。

During the quarter, we recognized a gain of $0.6 million upon completion of the sale of equipment related to our MesoScribe subsidiary. As previously disclosed, we have decided to wind down the operations of MesoScribe. MesoScribe ceased operations effective September 30, 2024, upon fulfillment of its final orders. The increase in CVD Equipment revenues of $0.9 million, or 18.5% as compared to the prior year quarter, principally is from increases in revenues from aerospace contracts in progress, offset in part by lower revenues for PVT systems and spare parts.

在本季度，我們在完成與 MesoScribe 子公司相關的設備銷售後確認了 60 萬美元的收益。如同先前所揭露的，我們決定停止 MesoScribe 的營運。MesoScribe 在完成最終訂單後於 2024 年 9 月 30 日停止營運。CVD 設備營收成長 90 萬美元，較去年同期成長 18.5%，主要來自正在進行的航空航太合約收入的成長，但部分被 PVT 系統和備件收入的下降所抵消。

Our SDC segment revenues were 27.5% higher than the third quarter of 2023, as demand for SDC's gas delivery systems remained strong. During the three months ended September 30, 2024, we did record a noncash charge to reduce the net realizable value of our PVT150 inventory by approximately $1 million. This was based on our assessment of the current market for silicon carbide equipment for 150-millimeter systems.

由於對 SDC 天然氣輸送系統的需求仍然強勁，我們的 SDC 部門營收比 2023 年第三季高出 27.5%。在截至 2024 年 9 月 30 日的三個月中，我們確實記錄了一項非現金費用，使 PVT150​​ 庫存的可變現淨值減少了約 100 萬美元。這是基於我們對 150 毫米系統碳化矽設備目前市場的評估。

Our gross profit for the three months ended September 30, 2024, was $1.8 million, representing a gross profit margin of 22.4%. This is compared to a gross profit of $1.6 million or a gross profit margin of 25.6% for the 3 months ended September 30, 2023. This increase in gross profit of $0.2 million was primarily due to the higher revenues as well as improved margins on CVD contracts in progress and higher gross margins on the final MesoScribe sales. These increases were partially offset by the $1 million inventory charge.

截至2024年9月30日止三個月的毛利為180萬美元，毛利率為22.4%。相較之下，截至2023年9月30日的三個月的毛利為160萬美元，毛利率為25.6%。毛利增加 20 萬美元主要是由於收入增加、正在進行的 CVD 合約利潤率提高以及最終 MesoScribe 銷售毛利率提高。這些增長被 100 萬美元的庫存費用部分抵消。

Operating income for the third quarter was $77,000 as compared to an operating loss of $1 million in the third quarter of 2023. The current year quarter does include gross profit on the final sales of MesoScribe of approximately $0.5 million; the gain on the sale of equipment of MesoScribe of $0.6 million; and the inventory charge offsetting that by $1 million.

第三季營業收入為 77,000 美元，而 2023 年第三季營業虧損為 100 萬美元。本季確實包括 MesoScribe 最終銷售額約 50 萬美元的毛利；出售 MesoScribe 設備的收益為 60 萬美元；庫存費用抵銷了 100 萬美元。

After other income, which consists principally of interest income, our net income for the third quarter was $209,000, or $0.03 per share for both basic and diluted. This compares to a net loss for the third quarter of '23 of $753,000, or $0.30 per share for basic and diluted. Our working capital at September 30, '24, was $13.3 million as compared to $14.3 million at the end of December '23. Our return to consistent profitability is dependent upon, among other things, the receipt of new equipment orders, our ability to mitigate the impact of inflationary pressures as well as managing planned capital expenditures and operating expenses.

扣除其他收入（主要包括利息收入）後，我們第三季的淨利潤為 209,000 美元，即基本收入和稀釋後每股收入 0.03 美元。相比之下，2023 年第三季的淨虧損為 753,000 美元，基本虧損和稀釋每股虧損為 0.30 美元。截至 2024 年 9 月 30 日，我們的營運資金為 1,330 萬美元，而截至 2023 年 12 月末，我們的營運資金為 1,430 萬美元。我們能否恢復穩定的獲利能力取決於新設備訂單的接收、減輕通膨壓力影響的能力以及管理計畫資本支出和營運支出的能力。

In addition, as Manny mentioned, our revenues and orders have historically fluctuated based on changes in order rate as well as other factors in our manufacturing process that impacts the timing of our revenue recognition.

此外，正如曼尼所提到的，我們的收入和訂單歷來根據訂單率的變化以及我們製造過程中影響我們收入確認時間的其他因素而波動。

Accordingly, orders received from customers and revenue recognized may fluctuate from quarter-to-quarter. After considering all these factors, we believe our cash and cash equivalents and our projected cash flow from operations will be sufficient to meet our working capital and capital expenditure requirements for the next 12 months. We will continue to evaluate the demand for our products, assess our operations and take actions anticipated to maintain our operating cash to support our working capital needs.

因此，從客戶收到的訂單和確認的收入可能會逐季度波動。考慮到所有這些因素後，我們相信我們的現金和現金等價物以及預計的營運現金流將足以滿足我們未來 12 個月的營運資本和資本支出需求。我們將繼續評估對我們產品的需求，評估我們的運營，並採取預期行動來維持我們的營運現金，以支持我們的營運資金需求。

Rich, thank you for your presentation. Our focus remains on our customer markets, our employees, our shareholders and the pursuit of growth and return to consistent profitability. We look forward to continuing to build on our success in the year ahead. Your comments and questions are important to us.

里奇，謝謝你的介紹。我們的重點仍然是我們的客戶市場、我們的員工、我們的股東以及對成長和回報持續獲利的追求。我們期待在新的一年繼續取得成功。您的意見和問題對我們很重要。

With the close of this presentation, I would like to open the floor to your questions.

隨著本次演講的結束，我想請大家提問。

(Operator Instructions) Frank Giordano, private investor.

（操作員說明）Frank Giordano，私人投資者。

Congratulations on the return to profitability. My question, again, you guys never mentioned the type of clients you have. Like I know you -- it's probably because you have to keep it quiet. But can you at least mention the type of company, if it's an EV company or if it's an airplane company or something like that? Is there a way you could do that? Or you just have to keep it private?

祝賀您恢復盈利。我的問題是，你們從來沒有提到你們的客戶類型。就像我認識你一樣——這可能是因為你必須保持安靜。但你至少能提到公司的類型嗎？有什麼辦法可以做到這一點嗎？或者你只需​​要保密？

Well, Frank, thank you for your question. Nice meeting you, first and foremost. We do have NDAs with our customers, where we're not allowed to disclose specifically for most of them what they've ordered and also that they are a customer. So we do not associate when we announce, for example, the order that we announced today, which was a follow-on order for CVI3500, which was sold for a bit over $3.5 million. We can say that they are a leading gas turbine engine manufacturer, and there are only a certain number of gas turbine manufacturers on the planet.

嗯，弗蘭克，謝謝你的問題。首先很高興認識你。我們確實與客戶簽訂了保密協議，不允許我們專門透露他們中的大多數人訂購了什麼以及他們是客戶。因此，例如，當我們宣布今天宣布的訂單時，我們不會將其關聯起來，該訂單是 CVI3500 的後續訂單，其售價略高於 350 萬美元。可以說，他們是領先的燃氣渦輪機製造商，而地球上只有一定數量的燃氣渦輪機製造商。

In the area of electric vehicles, again, we're not able to disclose who our end-use customers are other than that they are crystal growth and wafer producers in that space. So I understand the appetite and the desire to know more, but we are limited by our NDAs.

在電動車領域，我們無法透露我們的最終用戶是誰，只知道他們是該領域的晶體生長和晶圓生產商。所以我理解人們想要了解更多的慾望和渴望，但我們受到保密協議的限制。

So besides the name of the company, you cannot even mention what type of company it is. Is that correct?

所以除了公司名稱之外，你甚至不能提及它是什麼類型的公司。這是正確的嗎？

No, they can. I did before. The aerospace company manufactures gas turbine engines, and the EV company manufactures silicon carbide wafers.

不，他們可以。我以前做過。航空航太公司生產燃氣渦輪發動機，電動車公司生產碳化矽晶圓。

Okay. So you did mention EV company, all right, okay.

好的。所以你確實提到了電動車公司，好吧，好吧。

Well, the EV use case, the application I did mention, yes, Frank.

嗯，電動汽車用例，我確實提到過的應用程序，是的，弗蘭克。

Okay. All right. I will recheck it again. All right. Besides that, again, congratulations again and hopefully, things get better down the road.

好的。好的。我會再重新檢查一次。好的。除此之外，再次恭喜你，希望以後一切都會變得更好。

Thank you, sir. Thank you, Frank.

謝謝您，先生。謝謝你，弗蘭克。

(Operator Instructions) With no further questions at this time, I would like to turn the conference back over to Mr. Lakios for closing remarks.

（操作員指示）目前沒有其他問題，我想將會議轉回拉基奧斯先生進行閉幕致詞。

Thank you, operator, and thank you, everyone, for dialing in. We appreciate your attendance on the call and all of your support and especially the loyalty from our shareholders and our employees. If you have any further questions, please reach out to Richard or myself directly. This concludes our third quarter call. Thank you.

謝謝接線員，也謝謝大家撥電話。我們感謝您參加電話會議以及您的所有支持，特別是我們的股東和員工的忠誠。如果您還有任何疑問，請直接聯繫理查德或我本人。我們的第三季電話會議到此結束。謝謝。

Thank you. You may now disconnect, and thank you once again for your participation.

謝謝。您現在可以斷開連接，再次感謝您的參與。