CVD Equipment Corp (CVV) 2021 Q1 法說會逐字稿

Greetings, and welcome to CVD Equipment's 2021 First Quarter Results Conference Call. (Operator Instructions) As a reminder, this conference is being recorded. We will begin with some prepared remarks followed by a question-and-answer session. Presenting on the call today will be Emmanuel Lakios, President and CEO; and Thomas McNeill, Chief Financial Officer.

各位好，歡迎參加 CVD Equipment 2021 年第一季財報電話會議。（接線員指示）提醒各位，本次會議將被錄音。我們將先進行部分預先準備的發言，隨後進入問答環節。今天出席並發言的有：總裁暨執行長 Emmanuel Lakios，以及財務長 Thomas McNeill。

We have posted our earnings press release and call replay information to the Investor Relations section of our website at www.cvdequipment.com. Before I begin, I'd 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.

我們已將財報新聞稿與電話會議重播資訊發布於本公司網站 www.cvdequipment.com 的投資人關係專區。在開始之前，我想提醒各位，今天電話會議中的許多評論包含前瞻性陳述，其中包括與未來財務表現、市場成長、可服務總市場（TAM）、對我們產品的需求，以及一般營運狀況與展望相關的內容。

These forward-looking statements are based on certain assumptions, expectations and projections and are subject to a number of risks and uncertainties described in our press release and in our filings with the SEC, including, but not limited to, the Risk Factors section of our 10-K for the year ended December 31, 2020. 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.

這些前瞻性陳述係基於若干假設、預期與推估，並受我們新聞稿及向美國證券交易委員會（SEC）提交之文件中所述的多項風險與不確定性影響，包括但不限於截至 2020 年 12 月 31 日止年度 10-K 年報中的「風險因素」章節。實際結果可能與本次電話會議所述內容存在重大差異。此外，所有前瞻性陳述均以今日為準，我們不承擔因新情況或修正預期而更新任何前瞻性陳述之義務。

Now I would like to turn the call over to Manny.

現在我想把電話會議交給 Manny。

Thank you. Welcome to CVD Equipment Corporation's quarterly conference call. My name is Manny Lakios, CEO and President, and I'm pleased to be presenting to you today regarding important company developments and pertinent information relative to our business. As we will be providing substantive information, your thoughts are important to us. We request you wait to ask questions at the end during our question-and-answer session.

謝謝。歡迎參加 CVD Equipment Corporation 的季度電話會議。我是 Manny Lakios，執行長兼總裁，很高興今天向各位說明公司重要進展以及與我們業務相關的重點資訊。由於我們將提供實質性資訊，各位的想法對我們很重要。我們請各位先保留問題，待最後的問答環節再提問。

I would like to introduce our CFO, Mr. Thomas McNeill, who will provide you our financial first quarter 2021 summary.

我想介紹我們的財務長 Thomas McNeill 先生，他將為各位提供 2021 年第一季財務摘要。

Thank you, Manny. As a result of the COVID-19 pandemic, CVD's new order bookings substantially decreased commencing in the first quarter of 2020, which reduced revenues in subsequent quarters, resulting in our first quarter 2021 revenue of $3.4 million as compared to $6 million, which is the pre COVID-19 pandemic era in the first quarter of 2020, a decrease of $2.6 million or 44.3%. This reduction in sales and the resultant lower gross profit negatively affected our net income in the first quarter of 2021. Our net loss for the first quarter of 2021 was $1.5 million or $0.23 per diluted share as compared to a net income of $1.7 million or $0.25 per diluted share in the first quarter of 2020.

謝謝你，Manny。由於 COVID-19 疫情，CVD 的新訂單接單自 2020 年第一季起大幅下降，並使後續季度營收降低，導致我們 2021 年第一季營收為 340 萬美元，相較於 2020 年第一季（COVID-19 疫情前時期）的 600 萬美元，減少 260 萬美元或 44.3%。銷售下滑及由此造成的毛利降低，對我們 2021 年第一季淨利造成負面影響。我們 2021 年第一季淨損為 150 萬美元，或稀釋後每股虧損 0.23 美元；相較之下，2020 年第一季為淨利 170 萬美元，或稀釋後每股盈餘 0.25 美元。

Let me note that during the first quarter of 2020, CVD was favorably impacted by the CARES Act, which allowed for the carryback of NOLs and resulted in CVD recognizing $1.5 million of an income tax benefit.

我補充說明，於 2020 年第一季，CVD 受《CARES 法案》之利多影響，該法案允許淨營業損失（NOL）結轉回溯，因而使 CVD 認列 150 萬美元的所得稅利益。

As compared to the fourth quarter of 2020, CVD's revenue in the first quarter of 2021 increased $200,000 to $3.4 million, and the net loss decreased by $200,000 as compared to the net loss in the fourth quarter of $1.7 million. And that $1.7 million is exclusive of the impairment charges of $3.6 million related to the CVD Tantaline product line.

相較於 2020 年第四季，CVD 於 2021 年第一季營收增加 20 萬美元至 340 萬美元；淨損亦較第四季的 170 萬美元淨損減少 20 萬美元。該 170 萬美元不包含與 CVD Tantaline 產品線相關的 360 萬美元減損費用。

The company's backlog at March 31, 2021, improved by $300,000 to $6 million as compared to $5.7 million at December 31, 2020. Since the first quarter of 2020, the company continues to experience significant negative effects due to COVID-19 pandemic, including reductions of new orders, as I mentioned before. However, the company's order activity has improved, both in the quarter ended March 31, 2021, and also into Q2 2021. And its longer-term improvements are expected to be benefited by announced slow recovery in the aerospace markets, which industry reports indicate improvements into 2022 and '23.

截至 2021 年 3 月 31 日，公司在手訂單（backlog）較 2020 年 12 月 31 日的 570 萬美元增加 30 萬美元至 600 萬美元。自 2020 年第一季以來，公司持續受到 COVID-19 疫情的顯著負面影響，包括新訂單減少（如我先前所述）。然而，公司接單活動已在截至 2021 年 3 月 31 日止季度以及進入 2021 年第二季後有所改善。從較長期來看，預期將受惠於已宣布的航太市場緩步復甦；產業報告指出，該復甦在 2022 年與 2023 年將有所改善。

With respect to the building sale, as previously discussed at our year-end conference call, in order to increase our liquidity and to provide necessary working capital to support our ongoing business and operations, we have decided to sell our facility located at 555 North Research Place in Central Islip, New York. And on March 29, 2021, we entered into an agreement to sell this building for a purchase price of $24,360,000, subject to the satisfaction of waiver of certain conditions to closing or contingencies, which have now been satisfied.

關於出售大樓一事，如同我們在年終電話會議中先前所討論，為提升流動性並提供支持我們持續業務與營運所需的營運資金，我們已決定出售位於紐約州 Central Islip、555 North Research Place 的廠房。並且於 2021 年 3 月 29 日，我們簽署協議以 24,360,000 美元的購買價格出售該大樓，交易仍須滿足或豁免若干交割條件或或有事項，而這些條件目前已獲滿足。

A portion of the sale proceeds would be used to satisfy the existing mortgage debt of approximately $9.2 million at March 31, 2021. And to pay various transaction-related costs in an amount to be determined. The excess proceeds will be used for general working capital purposes. On or about May 23, 2021, the buyer may advise us of any requirement to extend the closing date up to 60 days thereafter, which would also require them to put an additional escrow amount of $1.2 million.

部分出售所得將用於清償截至 2021 年 3 月 31 日約 920 萬美元的既有抵押貸款債務，並支付金額尚待確定的各項交易相關成本。剩餘款項將用於一般營運資金用途。於 2021 年 5 月 23 日前後，買方可能通知我們其是否需要將交割日延後最多 60 天；若延後，亦將要求其額外支付 120 萬美元的託管款（escrow）。

In accordance with GAAP, or generally accepted accounting principles, at March 31, 2021, the carrying value of the building in the amount of $16.2 million is reflected in current assets as assets held for sale, which was previously reflected in property, plant and equipment or our long-term assets. Also, the 555 Building mortgage in the amount of approximately $9.2 million is classified as short-term debt, which was previously reflected in both current and long-term debt.

依據 GAAP（一般公認會計原則），截至 2021 年 3 月 31 日，該大樓帳面價值 1,620 萬美元列示於流動資產中的「待出售資產」，先前則列示於不動產、廠房及設備（或我們的長期資產）。此外，555 大樓的抵押貸款約 920 萬美元被分類為短期負債，先前則分別列示於流動負債與長期負債。

With respect to the consolidation of our 555 Building into 355, which we previously determined is not needed for present and future business operations. In April 2021, we completed the move of our Tantaline U.S.A. product line to our 355 building. While all functions of the Tantaline product line have been consolidated into the Denmark office, and the United States expenses related to Tantaline have ceased. Our MesoScribe operations have -- move has commenced and is expected to be completed by the end of June of 2021. Once both the sale of the building and the consolidation into 355 is completed, we anticipate achieving ongoing savings.

關於將我們 555 大樓的作業整併至 355 大樓（我們先前已判定該 555 大樓對目前及未來營運並非必要）。在 2021 年 4 月，我們已完成將 Tantaline U.S.A. 產品線搬遷至 355 大樓。由於 Tantaline 產品線的所有職能已整併至丹麥辦公室，且美國端與 Tantaline 相關的費用已停止。我們的 MesoScribe 營運搬遷已開始，預計於 2021 年 6 月底前完成。一旦大樓出售與整併至 355 的作業皆完成，我們預期可達成持續性的成本節省。

With the appointment of Manny, our new CEO, in January 2021, we began an intensive analysis of our entire business and operations, including the materials business. Based upon that analysis, we believe our primary focus should be on the core equipment business and that the materials business strategy should be revised, with some of its current elements potentially minimized or ceased. Based upon our analysis in January, we were forecasting continued losses and negative cash flow for our Tantaline product line, and as a consequence, we implemented plans to eliminate further investment in our Tantaline product line, which is resulting in the avoidance of approximately $1.5 million to $2 million in additional costs. In addition, we have recorded an impairment charge, as we previously noted, of $3.6 million in the fourth quarter and year ended December 31, 2020. We are driven to achieve profits and ROI in all operating divisions in the future.

隨著 Manny 於 2021 年 1 月就任新任執行長，我們開始對整體業務與營運（包括材料業務）進行密集分析。根據該分析，我們認為主要重點應放在核心設備業務，材料業務策略應予以修訂，其中部分現行要素可能需要縮減或停止。依據我們 1 月的分析，我們預測 Tantaline 產品線將持續虧損並產生負現金流，因此我們已實施計畫以消除對 Tantaline 產品線的進一步投資，從而避免約 150 萬至 200 萬美元的額外成本。此外，如先前所述，我們已於截至 2020 年 12 月 31 日止第四季及年度認列 360 萬美元的減損費用。未來我們致力於在所有營運部門達成獲利與投資報酬率（ROI）。

Turning to liquidity. Our cash and cash equivalents were $5.9 million at March 31, 2021, as compared to $7.7 million at December 31, 2020. Working capital was $12.3 million at March 31, 2021, as compared to $8.1 million at December 31, 2020. That's an increase of $4.2 million or 52%. This is the result of our actions, resulting in classifying our long-term assets and liabilities related to selling the building as short term, and for which we expect the building will close in the near term, offset in part by the net loss for the quarter of $1.5 million.

接著談流動性。截至 2021 年 3 月 31 日，我們的現金及約當現金為 590 萬美元，相較於 2020 年 12 月 31 日的 770 萬美元。營運資金截至 2021 年 3 月 31 日為 1,230 萬美元，相較於 2020 年 12 月 31 日的 810 萬美元，增加 420 萬美元或 52%。此增幅係源於我們採取的行動，將與出售大樓相關的長期資產與負債重新分類為短期項目，且我們預期該大樓將於近期完成交割；但部分被本季 150 萬美元的淨損所抵銷。

In addition, this quarter, we have substantially reduced our CapEx from $422,000 in Q1 2020 to just $26,000 this quarter related to ceasing further U.S.A. spend on the Tantaline product line. With respect to future expected benefits, we applied for forgiveness of our $2.4 million PPP loan in April 2021 and anticipate although substantially all to be forgiven. And we are awaiting the balance of our tax receivable in the amount of $700,000 from the CARES Act approved in Q1 2020, which allowed carrybacks of the NOLs.

此外，本季我們已大幅降低資本支出（CapEx），從 2020 年第一季的 422,000 美元降至本季僅 26,000 美元，主要與停止在美國對 Tantaline 產品線的進一步支出有關。就未來預期效益而言，我們已於 2021 年 4 月申請豁免我們 240 萬美元的 PPP 貸款，並預期雖然幾乎全部將獲豁免。此外，我們正等待 2020 年第一季核准之 CARES Act 下 700,000 美元的稅款應收餘額，該法案允許將 NOL（淨營業虧損）結轉回溯。

The longer-term impacts from the COVID-19 outbreak are highly uncertain and cannot be predicted. Our return to profitability is dependent upon, among other things, the receipt of new equipment orders, the lessening of the ongoing effects of COVID-19 on our business and the aerospace market, and improvements in our operational efficiencies, such as the consolidation of our Central Islip facilities, the sale of 555 Building and reduction of interest expense as well as managing planned CapEx and operating expenses.

COVID-19 疫情爆發的長期影響高度不確定，且無法預測。我們能否恢復獲利取決於多項因素，其中包括：取得新的設備訂單、COVID-19 對我們業務及航太市場的持續影響減弱，以及我們營運效率的改善，例如整併我們位於 Central Islip 的設施、出售 555 大樓並降低利息費用，以及管理既定的資本支出（CapEx）與營運費用。

Based upon all these factors, we believe that our cash and cash equivalent positions and cash flow from operations will be sufficient to meet our working capital and capital expenditure requirements for the next 12 months of the filing of the Form 10-Q. Should the current environment continue longer or worsen, we will continue to assess our operations and take actions anticipated to maintain our operating cash to support the working capital needs as well as compliance with our loan covenant.

綜合上述因素，我們相信在提交 Form 10-Q 後的未來 12 個月內，我們的現金及約當現金部位以及營運活動現金流量，將足以滿足我們的營運資金與資本支出需求。若目前環境持續更久或惡化，我們將持續評估營運並採取預期可維持營運現金的行動，以支應營運資金需求並遵循我們的貸款契約條款。

I'll now like to turn the call back to Manny, our CEO.

接下來我想把電話交回給我們的執行長 Manny。

Tom, thank you for your presentation and insight. As we completed our first quarter, we are cautiously optimistic that the 2020 COVID pandemic is forecasted to be contained and the effects of it will eventually wane. We have signs that the worst is over for our served markets. The damage done to the global economy cannot be monetized. Our business was not immune to this COVID pandemic. We have been set back in sync with our major market, aerospace, specifically in the area of advanced material gas turbine engine components.

Tom，感謝你的簡報與洞見。隨著我們完成第一季，我們對於 2020 年 COVID 疫情預期將受到控制、其影響終將減弱，抱持審慎樂觀。我們看到我們所服務市場最糟的情況已經過去的跡象。對全球經濟造成的損害無法以金錢衡量。我們的業務也未能免於這場 COVID 疫情。我們與我們的主要市場——航太——同步受到挫折，特別是在先進材料燃氣渦輪引擎零組件領域。

The impact of global travel and cascading effect to aerospace is astounding, and the timing of the recovery is uncertain. But what is certain is that global air travel will come back eventually. CVD equipment will be poised and ready to respond to the demand for new equipment and services. We continue to receive customer input and industry news reports supporting a beginning of recovery to what would be our order rate in 2022. Our other markets, such as carbon-based products, and our legacy products, serving the academia and research markets, are showing signs of recovery as funding is becoming available and as university labs reopen after being shuttered during the pandemic.

全球旅行對航太產業的衝擊及其連鎖效應令人震驚，而復甦時點仍不確定。但可以確定的是，全球航空旅行終將回來。CVD 設備將蓄勢待發，準備回應對新設備與服務的需求。我們持續收到客戶回饋與產業新聞報導，支持 2022 年我們訂單速率將開始復甦的看法。我們的其他市場，例如碳基產品，以及我們的傳統產品（服務學術界與研究市場），也顯示出復甦跡象，因為資金逐步到位，且大學實驗室在疫情期間關閉後正重新開放。

Even with these signs of recovery, we remain cautious in our planning. The sale of the 555 Building is on plan for closing in the next months. We will use the provided capital wisely for the sustainability and growth of the company. Depending on the order rate, we will continue to evaluate our infrastructure cost model and take thoughtful measures to reduce fixed expenses in all areas.

即便有這些復甦跡象，我們在規劃上仍保持謹慎。555 大樓的出售正按計畫進行，預計在未來幾個月完成交割。我們將明智運用所提供的資本，以支持公司的永續與成長。視訂單速率而定，我們將持續評估基礎設施成本模型，並在各領域採取審慎措施以降低固定費用。

I would like to spend some time on our product lines, the equipment group. We received in Q1, 3 FirstNano system legacy products orders. Our spare parts and service orders also showed some recovery even though the recovery was modest. The leading indicators for orders, which is our quotation level, was up in Q1, indicating that our systems that are in production are being started up again.

我想花一些時間談談我們的產品線——設備事業群。我們在第一季收到 3 套 FirstNano 系統的傳統產品訂單。我們的備品與服務訂單也出現一些復甦，儘管幅度不大。作為訂單領先指標的報價水準在第一季上升，顯示我們正在生產中的系統正重新啟動。

Our key markets are slowly showing signs of recovery, as previously noted. Through more effective and increased account management, we are using this post-pandemic period to reset and better position ourselves with our existing and future customers.

如先前所述，我們的關鍵市場正緩慢顯現復甦跡象。透過更有效且更強化的客戶管理，我們正利用這段後疫情時期重新調整，並在既有與未來客戶面前更好地定位自己。

Our MesoScribe group, which we acquired in 2017, continues to focus on high-temperature instrumentation in very challenging environments, such as in gas turbine engine and satellites. During Q1, we received an additional SBIR Phase 2 grant for $750,000 to further develop the application technology for additive manufacturing of gas turbine engine components. The MesoScribe group is profitable and cash flow positive. Presently, we are in the process of consolidating the operation from our 555 facility into our 355 facility. We expect that, that will be completed and is on plan for the end of of 2021.

我們於 2017 年收購的 MesoScribe 團隊，持續聚焦於極具挑戰環境下的高溫儀測，例如燃氣渦輪引擎與衛星。在第一季，我們獲得額外一筆 750,000 美元的 SBIR 第二期（Phase 2）補助，用於進一步開發燃氣渦輪引擎零組件增材製造的應用技術。MesoScribe 團隊目前獲利且現金流為正。現階段，我們正將營運自 555 設施整併至 355 設施，預期將於 2021 年底完成，並按計畫推進。

Tantaline, the product line was acquired in 2016. Since then, the company has invested in the expansion in the market and operational capability in Denmark as well as in our U.S. facility. Our evaluation is the Denmark facility has ample capacity for the next years. Our objective is to have the Tantaline product line be cash neutral and to minimize any further investment requirement.

Tantaline 產品線於 2016 年收購。自那時起，公司已投資於丹麥以及我們美國設施的市場拓展與營運能力擴充。我們的評估是，丹麥設施在未來幾年具備充足產能。我們的目標是讓 Tantaline 產品線達到現金收支中性，並將任何進一步投資需求降至最低。

During Q1, all sales and marketing activities were consolidated into the Denmark facilities, and the U.S. operations was ceased. These actions have reduced our operating costs, and we expect that, along with continued focus on obtaining orders, we should turn the corner and have the Tantaline product line cash flow neutral.

在第一季，所有銷售與行銷活動已整併至丹麥設施，而美國營運已停止。這些行動降低了我們的營運成本；我們預期在持續專注於取得訂單的同時，將能扭轉局面，使 Tantaline 產品線達到現金流中性。

We are also in discussion with our landlord in Denmark to extend the lease, reducing any near-term investment requirement. The U.S.A Tantaline facility in operation was and has been determined to not be required to serve the Tantaline market.

我們也正與丹麥的房東討論延長租約，以降低任何短期投資需求。美國的 Tantaline 設施營運已被判定不需要用來服務 Tantaline 市場。

Our SDC product line and division continues to be both a captive and merchant supplier of gas and liquid delivery systems. Our SDC products are considered to be a standard in the marketplace. They are also supplier to our equipment division and further fulfill our in-house facilities requirements. With the Bring Technology Home to the U.S. initiatives, both the quotation and order rate for SDC has increased. This is due to the build-out of additional fabs, primarily in the United States as well as overseas. The division continues to be cash flow positive.

我們的 SDC 產品線與事業部持續同時作為燃氣與液體輸送系統的自用（captive）與對外（merchant）供應商。我們的 SDC 產品被視為市場標準。它們同時供應給我們的設備事業部，並進一步滿足我們內部設施需求。隨著「Bring Technology Home to the U.S.」倡議推動，SDC 的報價與訂單速率均有所提升。這是因為新增晶圓廠（fabs）的建置擴張，主要在美國以及海外。該事業部持續維持正向現金流。

In the ECMO products, as we reported in the past, our applications lab has developed many novel applications components. One such application is blood oxygen transfer and more specifically extracorporeal membrane oxygenation, ECMO. At this time, there is no recent notable developments to speak of. And we'll keep you informed as there are such.

在 ECMO 產品方面，如同我們過去所報告的，我們的應用實驗室已開發出許多新穎的應用零組件。其中一項應用是血氧轉移，更具體而言是體外膜氧合（extracorporeal membrane oxygenation, ECMO）。目前沒有值得特別說明的最新進展；若有相關進展，我們將持續向各位更新。

In summary, we are cautiously optimistic that the worst is over, that our served markets and customers will slowly recover. We continue to apply focus in the area of our products and customers with financial scrutiny of our spending. Our employees and customers are loyal. We are focused on business and operational planning for structured profitability and growth. Planning is not a onetime and done event, but continues to evolve as the market conditions change. Hence, we continue our assessment of our plan, and we expect to be in the execution phase throughout 2021.

總結而言，我們對最糟情況已過、我們所服務的市場與客戶將逐步復甦，抱持審慎樂觀。我們持續在財務審慎控管支出的前提下，聚焦於產品與客戶。我們的員工與客戶都很忠誠。我們專注於業務與營運規劃，以達成結構性的獲利與成長。規劃不是一次性完成的事件，而是會隨市場狀況變化而持續演進。因此，我們持續評估我們的計畫，並預期在 2021 年全年都將處於執行階段。

On May 7, 2021, Martin J. Teitelbaum, a member of the Board of Directors of CVD Equipment Corporation, notified the Board that he was resigning his position as a director effective immediately. We have accepted such resignation. We committed to you that we would continue to provide timely communication. To that matter, we have announced that our annual shareholder meeting will be held July 15th. We will continue to communicate on the important developments in the meanwhile.

2021 年 5 月 7 日，CVD Equipment Corporation 董事會成員 Martin J. Teitelbaum 通知董事會，他將即刻辭去董事職務並立即生效。我們已接受該辭呈。我們曾向各位承諾將持續提供即時溝通。就此，我們已宣布年度股東大會將於 7 月 15 日舉行。在此期間，我們將持續就重要進展進行溝通。

With that, may I say your comments and questions are important to us. With the close of our presentation, we would like to open the floor to your questions. Brock, could you just give them a walk through?

接下來，我想說各位的意見與提問對我們很重要。隨著簡報結束，我們想開放現場讓各位提問。Brock，你可以帶大家走一下流程嗎？

(Operator Instructions) Our first question today is from Brett Reiss of Jenny Montgomery Scott.

（接線員指示）今天的第一個問題來自 Jenny Montgomery Scott 的 Brett Reiss。

Manny, Tom, can you hear me?

Manny、Tom，你們聽得到我嗎？

Very well so, Brett. It would not be a meeting without you asking a question.

當然聽得到，Brett。沒有你提問就不像是一場會議。

I'm just wondering, have you -- do you sit down, do you get your salespeople with your engineering talent that you have to kind of brainstorm to see if you can find what the skill sets the company has, some products that you can sell without having to kind of just sit back and wait passively for aerospace to recovery?

我只是想知道，你們是否——你們會坐下來，把你們的業務人員和你們所擁有的工程技術人才集合起來做腦力激盪，看看公司具備哪些技能組合、有哪些產品可以銷售，而不必只是被動地坐等航太產業復甦？

Brett, if that's the question, let me answer that because it is part of our new philosophy. We do not wait for the phone to ring. This week, I actually was at an aero -- our leading company in aerospace, which we won't discuss the name, and not in searching, but in response to customer satisfaction and product road mapping and technology road mapping.

Brett，如果這是你的問題，讓我回答，因為這是我們新理念的一部分。我們不會等電話響。本週我其實去了某家航太——我們在航太領域的領先公司（我們不會提名字），不是去推銷，而是回應客戶滿意度、產品路線圖規劃以及技術路線圖規劃。

We have presently completed our strategic planning process. We'll give the audience an opportunity to see some of those elements to the extent we can supply those during our July shareholder meeting and give you a glimpse of our focus going forward. But we've spent the last 4 months working on planning, our strategic planning, many of the actions that we've taken, both on the cost side are not a precipitous across the board cuts, but a -- what I would say a thoughtful outcome of our planning process. So yes, we have a tremendous amount of communication within the organization today. Everybody has their hand on an oar to move the boat forward.

我們目前已完成策略規劃流程。我們會在7月的股東大會上，讓與會者有機會看到其中一些要素（在我們能提供的範圍內），並讓各位一窺我們未來的重點方向。不過，我們過去4個月一直在做規劃、策略規劃；我們採取的許多行動（包括成本面）並不是倉促的全面削減，而是——我會說——策略規劃流程深思熟慮後的結果。所以是的，我們現在在組織內部有大量溝通。每個人都在同心協力，推動這艘船向前。

Right, right. What was the employee headcount at the end of the year? And what is it now at the end of this first quarter?

對，對。去年年底的員工人數是多少？那現在第一季末是多少？

Yes. Brett, we're right around 120 employees, give or take, what it was at the end of the year. I think maybe it's about 3 -- net 3 down for the time.

是的。Brett，我們大約是120名員工，上下浮動一些，和年底差不多。我想目前大概淨減了3人左右。

Right. Right. And if business really snaps back with the amount and mix of employees, do you think you'll be able to manage the business, if hopefully order flow comes back?

對。對。如果業務真的快速回升，以目前員工的人數與組合，你覺得如果（希望）訂單流量回來了，你們能夠管理好業務嗎？

We have the technical and engineering talent on staff. The variable labor would be primarily in our supply chain. There, we're applying quite a bit of focus on how do we position ourselves more for a variable expense and leveraging the manufacturing that is outside of CVD proper. That would be -- I may not say the challenge, but that would be the area of focus for us, if the -- as you say, the business snaps back and is very elastic.

我們有技術與工程人才在編制內。可變動的人力主要會在供應鏈端。在那裡，我們正投入相當多的心力，思考如何讓我們的成本結構更偏向可變費用，並善用CVD本體以外的外部製造能力。那會是——我不一定稱之為挑戰——但如果如你所說業務快速回升、彈性很大，這將是我們的重點關注領域。

Right. And I mean you went into it somewhat. But when you say order activity has improved, can you go into a little bit more specificity of what that means?

對。而且我的意思是你有稍微提到。但當你說訂單活動已改善時，你能更具體一點說明那代表什麼嗎？

I can give you some insight. That's not typically something that we do. We were approximately 40% to 50%. I'm looking at the numbers here. I can't do the quick math. We're about 50% higher in orders in Q1 over Q4. But obviously, 2020, Q2, Q3, Q4 on an average were very weak due to the COVID. So we are seeing some level of recovery. We are cautious, and we're cautious in our comments and statements. We are seeing increased activity in aerospace spare parts demand for quotations and also the order rate increase. That's an indication that the equipment is starting to light up again. During that period of time, many of our sites, our production sites were turned off.

我可以給你一些觀察。這通常不是我們會做的事。我們大約是40%到50%——我在看這裡的數字，我沒辦法快速心算——我們第一季的訂單量比第四季高了大約50%。但很明顯地，2020年第二季、第三季、第四季平均都非常疲弱，因為COVID的影響。所以我們確實看到某種程度的復甦。我們保持審慎，也在評論與陳述上保持審慎。我們看到航太備品需求的報價詢問增加，訂單率也提高。這表示設備開始重新啟動。在那段期間，我們許多據點、我們的生產據點都曾關停。

Right. One last one, and I'll drop back in queue. In the past, the company would say that there was a great market opportunity for coatings with medical products, and nothing seems to have materialized there. Why is that? And is that an area of opportunity for us?

對。最後一個問題，我問完就回到隊列。過去公司曾說醫療產品的鍍膜市場機會很大，但似乎沒有實質成果。為什麼？那會是我們的機會領域嗎？

The medical industry, whether it's tantalum for prosthetics, for implants that is, ball sockets, which was an -- it's an area for our product line, that's a very specialized area. There are secondary competitors to us, not specifically people that provide tantalum deposition. But there's titanium, there are other 3D additive manufacturing techniques for doing -- for building up these components. Some of those are entrenched technologies that -- it's a small tugboat trying to turn the Eisenhower. It is a very sizable feat, and it's not a near-term event. I cannot say to you today that, that is on my strategic road map as a large growth area. We will continue to sell tantalum deposition and other material deposition systems to the medical, but it is not one of the top 3 applications for us right now.

醫療產業，不論是用於義肢的鉭（也就是植入物，例如髖關節球窩），那是——屬於我們產品線的一個領域，但非常專門。我們有次要競爭者，但不一定是提供鉭沉積的人。還有鈦，以及其他3D增材製造技術可用來——用來堆疊製作這些零組件。其中一些是根深蒂固的技術——就像一艘小拖船要去轉動艾森豪號一樣。這是非常艱鉅的工程，而且不會在短期內發生。我今天無法告訴你，這在我的策略路線圖上會是一個大型成長領域。我們會持續向醫療領域銷售鉭沉積及其他材料沉積系統，但目前它不是我們前三大應用之一。

Right. And if you were a betting man, would you bet the buyer of the building closes May 23rd or looks for a 60-day extension?

對。如果你是個愛下注的人，你會賭買方會在5月23日完成大樓交易交割，還是會尋求延長60天？

We're not betters, but it will close. They're a strong, reputable, Long Island company, and we have every indication it will close. But...

我們不下注，但它會完成交割。他們是一家實力雄厚、信譽良好的長島公司，我們有充分跡象顯示會完成交割。不過……

Yes. We would've not ventured into the deal, Brett, if we thought that there was an indication that we would not close. And I think Tom's comment is accurate that we -- I clearly am not a better, quite frankly, and I definitely don't bet with other people's money, which is our shareholders' money. So we have confidence, and there is no indication that it won't close in the next few months.

是的。Brett，如果我們認為有任何不會完成交割的跡象，我們當初就不會進入這筆交易。我認為Tom的說法是正確的：我們——我很清楚地說，我坦白講不是個愛下注的人，而且我絕對不會拿別人的錢下注，也就是我們股東的錢。所以我們有信心，也沒有任何跡象顯示未來幾個月內不會完成交割。

Our next question is from Martin Howard, a private investor.

下一個問題來自私人投資人Martin Howard。

Yes, my question is, there's a lot of hope for that health products, the Stony Brook Labs. You said there's nothing has happened to report. Why not? I mean, they're working, presumably, checking it out. Do they have some timing thing that will decide whether it's a viable product or not in the next quarter or so?

是的，我的問題是，大家對那些健康產品、Stony Brook實驗室寄予厚望。你說沒有任何進展可報告。為什麼？我的意思是，他們應該正在做、正在檢驗。是否有某個時間點，會在下一季左右決定它是否是可行產品？

Martin, we chatted last time as well. And let me give you -- and when I say there's nothing notable, it doesn't mean that we don't have some ongoing activities in that area. At this point, we are looking at options that are available to us. We have continued to work on the technology, and we're looking for some external funding through other sources, through research sources.

Martin，我們上次也聊過。讓我給你——當我說沒有值得一提的進展時，並不代表我們在那個領域沒有持續進行一些活動。目前我們正在評估我們可用的選項。我們持續在技術上努力，也在尋找外部資金，透過其他來源、研究資金來源。

So we have not had a setback. And we are in a -- probably what I would term in the product development terminology, we're in a gate review of the technology, and that may take us a quarter or 2. But again, what we don't want to do is give you any misconceptions that next quarter or 1 year from now that this will be a substantial element of our business.

所以我們沒有遭遇挫折。而且我們正處於——用產品開發術語來說——我們正處於技術的關卡審查（gate review）階段，這可能需要一到兩個季度。但同樣地，我們不希望讓你誤以為下個季度或一年後，這會成為我們業務的重要組成部分。

(Operator Instructions) There appears to be no further questions at this time.

（接線員指示）目前似乎沒有其他問題。

Okay. Brock, if there are no additional questions, we'd like to adjourn today's meeting, and we look forward to speaking to everybody, giving you some more insight on our company and our plans in our July 15 Annual Shareholders Meeting.

好的。Brock，如果沒有其他問題，我們想結束今天的會議；我們期待在7月15日的年度股東大會上與各位交流，提供更多關於我們公司與計畫的洞見。

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.

今天的電話會議到此結束。您現在可以掛斷電話線。感謝您的參與。