Motorcar Parts of America Inc (MPAA) 2025 Q2 法說會逐字稿

Thank you for standing by. My name is Novi, and I will be your conference operator today. At this time, I would like to welcome everyone to the Motorcar Parts of America, Inc. fiscal 2025 second-quarter conference call and webcast. (Operator Instructions) I would now like to turn the call over to Gary Maier, Vice President of Corporate Communications and Investor Relations at Motorcar Parts of America.

謝謝你的支持。我叫諾維，今天我將擔任你們的會議操作員。現在，我歡迎大家參加 Motorcar Parts of America, Inc. 2025 財年第二季電話會議和網路廣播。（操作員說明）我現在想將電話轉接給美國 Motorcar Parts of America 企業傳播和投資者關係副總裁 Gary Maier。

Thank you, Novi, and thanks, everyone, for joining us for our call this morning. Before I turn the call over to Selwyn Joffe, Chairman, President and Chief Executive Officer; and David Lee, the company's Chief Financial Officer. I'd like to remind everyone of the safe harbor statement included in today's press release.

謝謝諾維，也謝謝大家今天早上參加我們的電話會議。在我將電話轉給董事長、總裁兼執行長 Selwyn Joffe 之前；以及該公司財務長 David Lee。我想提醒大家注意今天新聞稿中的安全港聲明。

The Private Securities Litigation Reform Act of 1995 provides a safe harbor for certain forward-looking statements, including statements made during today's conference call. Such forward-looking statements are based on the company's current expectations and beliefs concerning future developments and their potential effects on the company. There can be no assurance that future developments affecting the company will be those anticipated by Motorcar Parts of America.

1995 年《私人證券訴訟改革法案》為某些前瞻性陳述提供了安全港，包括今天電話會議期間所做的陳述。此類前瞻性陳述是基於公司目前對未來發展及其對公司潛在影響的預期和信念。無法保證影響公司的未來發展將符合 Motorcar Parts of America 的預期。

Actual results may differ from those projected in the forward-looking statements. These forward-looking statements involve significant risks and uncertainties, some of which are beyond the control of the company and are subject to change based upon various factors. In particular, expectations about anticipated future growth and opportunities with customers may not be achieved.

實際結果可能與前瞻性陳述中的預測有所不同。這些前瞻性陳述涉及重大風險和不確定性，其中一些風險和不確定性超出了公司的控制範圍，並可能根據各種因素而變化。特別是，對預期未來成長和客戶機會的期望可能無法實現。

The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. For a more detailed discussion of some of the ongoing risks and uncertainties of the company's business, I refer you to the various filings with the SEC that we make.

本公司不承擔公開更新或修改任何前瞻性陳述的義務，無論是由於新資訊、未來事件或其他原因。如需更詳細地討論公司業務中的一些持續風險和不確定性，我建議您參閱我們向 SEC 提交的各種文件。

I will now turn the call over to Selwyn Joffe to begin our call.

我現在將把電話轉給 Selwyn Joffe 開始我們的通話。

Thank you, Gary. I appreciate everyone joining us today. We are gratified by our continued record sales performance for the quarter and six months. We are excited by the opportunities we see on the horizon and remain optimistic about the second half of fiscal 2025 and achieving our full-year targets. We reported record gross profit for the quarter and six months and gross margin metrics showed continued improvement, which David will discuss in more detail.

謝謝你，加里。我感謝今天大家加入我們。我們對本季和六個月持續創紀錄的銷售業績感到滿意。我們對即將到來的機會感到興奮，並對 2025 財年下半年和實現全年目標保持樂觀。我們報告了本季和六個月的創紀錄毛利，毛利率指標顯示持續改善，大衛將更詳細地討論這一點。

We generated approximately $23 million of cash from operating activities, primarily due to strong operating results. Our initiatives to enhance profitability and neutralize working capital are progressing well. The result of these initiatives is to increase profitability and cash flow, which will enhance shareholder value.

我們從經營活動中產生了約 2,300 萬美元的現金，這主要歸功於強勁的經營業績。我們提高獲利能力和中和營運資金的措施進展順利。這些措施的結果是提高獲利能力和現金流，進而提高股東價值。

We are particularly excited by the operational efficiencies we are realizing from our emerging brake-related products, which have grown to be our second largest category. New brake business commencing in January will further enhance our production efficiencies, which should result in consolidated margin improvement. Clearly, our accelerating brake-related product sales are contributing to efficiencies from both purchasing and production.

我們對新興煞車相關產品所實現的營運效率感到特別興奮，這些產品已成為我們的第二大類別。一月份開始的新煞車業務將進一步提高我們的生產效率，這將導致綜合利潤率的改善。顯然，我們加速煞車相關產品的銷售有助於提高採購和生產效率。

Our team is doing an exceptional job to enhance performance metrics, and we look forward to continued growth and gross margin accretion for our important non-discretionary products. There are various factors related to our financial performance that are noncash and beyond our control, particularly the current sharply unfavorable noncash mark-to-market foreign exchange loss from Mexican lease liabilities and forward contracts.

我們的團隊在提高績效指標方面做得非常出色，我們期待我們重要的非全權委託產品的持續成長和毛利率增加。與我們的財務表現相關的各種非現金因素超出了我們的控制範圍，特別是目前墨西哥租賃負債和遠期合約造成的非現金以市價匯率損失，非常不利。

A strengthening dollar versus the peso results in large noncash mark-to-market expenses, which we internally eliminate when evaluating our underlying results. We are continuing to look at opportunities to minimize these noncash expenses, including funding our Mexico operations with pesos from sales in Mexico. As our sales in Mexico continue to grow, we will purchase fewer forward contracts to meet our peso obligations, which will lessen the impact of noncash foreign exchange expense fluctuations.

美元兌比索走強會導致大量非現金盯市費用，我們在評估基本業績時會在內部消除這些費用。我們正在繼續尋找機會最大限度地減少這些非現金支出，包括用墨西哥銷售的比索為我們的墨西哥業務提供資金。隨著我們在墨西哥的銷售額持續成長，我們將購買更少的遠期合約來履行我們的比索義務，這將減輕非現金外匯費用波動的影響。

Obviously, interest rates, particularly applicable to vendor finance programs utilized by our customers are a headwind. On a positive note, interest rates are headed lower, which will have a meaningful impact on profitability moving forward.

顯然，利率，特別是適用於我們客戶使用的供應商融資計劃的利率是一個阻力。從積極的角度來看，利率正在走低，這將對未來的獲利能力產生重大影響。

From an operational standpoint, results in the first half of fiscal 2025 were impacted by onetime severance expenses related to strategic cost reductions. This strategic relocation will generate expected annual savings of approximately $7.1 million. Approximately 90% of these savings will reduce the cost of goods sold and the remainder will reduce operating costs.

從營運角度來看，2025 財年上半年的業績受到與策略成本削減相關的一次性遣散費的影響。此次策略性搬遷預計每年可節省約 710 萬美元。其中約 90% 的節省將降低銷售成本，其餘的將降低營運成本。

As I noted last quarter, this culminating action was part of a multiyear relocation process to reduce costs, utilizing our low-cost global footprint and will facilitate further operating efficiencies. We are actively exploring additional initiatives to further reduce cost of goods sold.

正如我上季度指出的那樣，這項最終行動是多年搬遷過程的一部分，旨在利用我們低成本的全球足跡來降低成本，並將進一步提高營運效率。我們正在積極探索其他舉措，以進一步降低銷售成本。

Let me take a moment to highlight a few key near-term strategic objectives that support our favorable outlook. With respect to generating cash, we remain diligently focused on improving profitability and increasing margins. In addition, as the fiscal second half evolves, we expect our working capital metrics to gain momentum.

讓我花點時間強調一些支持我們良好前景的關鍵近期策略目標。在產生現金方面，我們仍然致力於提高獲利能力和增加利潤率。此外，隨著下半年財政的發展，我們預計我們的營運資本指標將獲得成長動力。

We have implemented initiatives to enhance inventory efficiencies and have also implemented processes to extend days outstanding on accounts payable. Our supply chain finance program is ramping up nicely and being enthusiastically accepted by our suppliers.

我們實施了提高庫存效率的舉措，並實施了延長應付帳款未清天數的流程。我們的供應鏈金融計畫進展順利，並受到供應商的熱烈歡迎。

Most importantly, we continue to evaluate allocation of capital to maximize shareholder value. Another positive ongoing initiative is the acceleration of new part number introductions, targeting at least 800 per year as supported by the introduction of 505 additional new part numbers announced last month, covering 302 million vehicles on the road. This maintains our leadership position in the categories we supply, which meets the needs of consumers and adds organic growth to our sales base.

最重要的是，我們繼續評估資本配置，以實現股東價值最大化。正在進行的另一項積極舉措是加速新零件編號的推出，目標是每年至少推出800 個新零件編號，並在上個月宣布的額外505 個新零件編號的推出的支持下，覆蓋道路上的3.02 億輛汽車。這保持了我們在供應類別中的領導地位，滿足了消費者的需求，並增加了我們銷售基礎的有機成長。

Not only are we growing organically, but we have secured meaningful new business commitments across all of our product lines. With respect to our diagnostic business, as I previously mentioned, we expect to sell more than $100 million of diagnostic equipment within the next three years with further opportunities pending.

我們不僅實現了有機成長，而且在所有產品線上都獲得了有意義的新業務承諾。至於我們的診斷業務，正如我之前提到的，我們預計在未來三年內銷售超過 1 億美元的診斷設備，並且還有更多機會等待。

We expect additional service revenue as more testers are deployed. We also expect more opportunities outside the United States as the business evolves. With regard to our heavy-duty business, we continue to leverage our reputation and industry position in this market, particularly with regard to supplying alternators and starters to our channel partners who are leaders in the heavy-duty aftermarket segment.

隨著更多測試人員的部署，我們預計會有額外的服務收入。隨著業務的發展，我們也預期美國以外的機會會更多。在我們的重型業務方面，我們繼續利用我們在該市場的聲譽和行業地位，特別是在向我們的通路合作夥伴提供交流發電機和起動機方面，他們是重型售後市場領域的領導者。

Our growth opportunities continue to gain momentum across multiple platforms, such as agriculture, Class 8 trucks, refrigeration, construction, material handling and transit motor coaches. Our Dixie brand is also evolving as an important supplier for the heavy-duty original equipment service for manufacturers. In the second half of the current fiscal year, we will remain focused on sales growth, profitability and neutralizing working capital.

我們的成長機會繼續在多個平台上獲得動力，例如農業、8 級卡車、冷凍、建築、物料搬運和運輸客車。我們的 Dixie 品牌也正在發展成為製造商重型原始設備服務的重要供應商。在本財年下半年，我們將持續專注於銷售成長、獲利能力和中和營運資本。

As I noted earlier, we expect our sales and profitability will continue to grow organically, and new business is gaining solid traction. From a strategic standpoint, we will continue to leverage our strengths, including great products manufactured at state-of-the-art facilities, solid customer relationship, industry-leading SKU coverage and order fill rates, not to mention our value-added merchandising and marketing support.

正如我之前指出的，我們預計我們的銷售額和獲利能力將繼續有機成長，新業務正在獲得堅實的牽引力。從戰略角度來看，我們將繼續利用我們的優勢，包括在最先進的設施生產優質產品、穩固的客戶關係、行業領先的 SKU 覆蓋率和訂單完成率，更不用說我們的增值營銷和營銷支持。

Our hard parts sales in Mexico continued to gain momentum as we experienced increased demand for our aftermarket parts. The rate of growth in this market is exciting, and we are well positioned to utilize our footprint to meet the growing demand. We are focused on increasing share in this region.

隨著我們對售後零件的需求增加，我們在墨西哥的硬零件銷售持續成長。這個市場的成長速度令人興奮，我們已做好充分準備，利用我們的足跡來滿足不斷增長的需求。我們致力於增加該地區的份額。

We continue to benefit and grow sales via our relationships with US-based retailers and warehouse distributors who are gaining a presence in this emerging market, as well as through independent Mexican distributors. Favorable long-term industry dynamics continue to bode well for the company, and we are extremely well positioned for sustainable top and bottom-line growth in our hard parts business as well as our testing solutions.

透過與在這個新興市場佔據一席之地的美國零售商和倉儲分銷商以及獨立的墨西哥分銷商的關係，我們繼續受益並增加銷售額。有利的長期行業動態繼續對公司來說是個好兆頭，我們處於非常有利的位置，可以實現我們的硬零件業務以及測試解決方案的可持續頂線和底線增長。

We are focused on growth across all product lines, including our quality-built brand, which is gaining market share within the professional installer market. This includes our most recent additions to our portfolio of brake calipers, brake pads and rotors. I reiterate that as we grow these product lines, we expect overall gross margin accretion. We are beginning to see the benefits of this. In short, we have the capacity and capabilities to support our customers' increasing demand across multiple product lines.

我們專注於所有產品線的成長，包括我們的優質品牌，該品牌正在專業安裝市場中贏得市場份額。這包括我們最新添加的煞車卡鉗、煞車片和煞車碟盤產品組合。我重申，隨著我們擴大這些產品線，我們預期整體毛利率會增加。我們開始看到這樣做的好處。簡而言之，我們有能力滿足客戶對多個產品線不斷增長的需求。

Our positive cash flows enabled us to reduce net debt by $22 million during the quarter and will allow us to pursue opportunities to further enhance shareholder value. It is worth highlighting that 98.8% of the US car park is comprised of hybrid and internal combustion engine vehicles.

我們的正現金流使我們在本季減少了 2,200 萬美元的淨債務，並使我們能夠尋求進一步提高股東價值的機會。值得強調的是，美國 98.8% 的停車場都是混合動力和內燃機汽車。

Non-discretionary aftermarket parts for the internal combustion engine market will be here for decades, and outlook supported by recently updated industry data showing that the average age of vehicles is now 12.8 years. One of our key competitive advantages is our ability to offer a broad range of applications for all makes and models. We remain focused on new model applications and our ability to meet expected demand as these vehicles enter the replacement market.

內燃機市場的非自主售後零件將存在數十年，最近更新的行業數據顯示車輛的平均車齡為 12.8 年，這一前景支持了這一前景。我們的主要競爭優勢之一是我們能夠為所有品牌和型號提供廣泛的應用。隨著這些車輛進入替換市場，我們仍然專注於新車型的應用以及滿足預期需求的能力。

I will now turn the call over to David to review our results in greater detail.

我現在將把電話轉給大衛，以更詳細地審查我們的結果。

Thank you, Selwyn, and good morning, everyone. I encourage everyone to read the earnings press release issued this morning as well as the 10-Q that will be filed later today. Let me first reiterate key financial performance metrics for the fiscal 2025 second quarter that we highlighted in this morning's news release.

謝謝你，塞爾溫，大家早安。我鼓勵大家閱讀今天早上發布的收益新聞稿以及將於今天稍後提交的 10-Q 報告。讓我先重申我們在今天早上的新聞稿中強調的 2025 財年第二季的關鍵財務業績指標。

Net sales increased 5.9% to a record $208.2 million. Gross profit increased to a record $41.3 million, impacted by certain onetime expenses of $2.7 million for onboarding new business and $1.3 million of transition expenses related to recent strategic relocation of certain operations with expected annualized savings of $7.1 million.

淨銷售額成長 5.9%，達到創紀錄的 2.082 億美元。毛利增加至創紀錄的4,130 萬美元，主要受到新業務啟動的270 萬美元一次性費用以及與近期某些業務戰略遷移相關的130 萬美元過渡費用的影響，預計年化節省額為710 萬美元。

Generated cash from operating activities of $22.9 million and reduced net bank debt by $22 million. Results were impacted by noncash items totaling $10.6 million as detailed in the exhibits. Net sales for the fiscal '25 second quarter increased 5.9% to an all-time record $208.2 million from $196.6 million in the prior year. Gross profit for the fiscal '25 second quarter increased to a record $41.3 million from $41.1 million a year earlier. I should mention that gross profit for the quarter was impacted by noncash expenses.

經營活動產生現金 2,290 萬美元，銀行淨債務減少 2,200 萬美元。結果受到總計 1,060 萬美元非現金項目的影響，如展品中詳述。2025 財年第二季的淨銷售額從上一年的 1.966 億美元成長了 5.9%，達到創紀錄的 2.082 億美元。25 財年第二季的毛利從去年同期的 4,110 萬美元增至創紀錄的 4,130 萬美元。我應該提到，該季度的毛利受到非現金支出的影響。

The noncash expenses reflect core and finished goods premium amortization and revaluation of cores on customer shelves, which are unique to certain of our products and required by GAAP. The total for these noncash expenses in the quarter was approximately $3.8 million or 1.8% impact to gross margin. A more detailed explanation of core accounting is available in a video posted on the company's website. Gross margin for the fiscal '25 second quarter was 19.8% compared with the 20.9% a year earlier.

非現金費用反映了核心產品和成品溢價攤銷以及客戶貨架上核心產品的重估，這是我們某些產品所獨有的，也是公認會計原則所要求的。本季這些非現金支出總額約為 380 萬美元，對毛利率的影響為 1.8%。該公司網站上發布的影片提供了有關核心會計的更詳細說明。2025 財年第二季的毛利率為 19.8%，去年同期為 20.9%。

In addition to the noncash expenses previously explained, as detailed in Exhibit 3 of this morning's earnings press release, gross margin was also impacted by a onetime $1.3 million or 0.6% of transition expenses in connection with the recent strategic relocation of certain operations with expected annualized savings of $7.1 million. Additional to the items detailed in Exhibit 3, gross margin for the fiscal second quarter was impacted by certain $2.7 million or 1.3% onetime expenses for onboarding new business, as I highlighted earlier.

除了先前解釋的非現金費用（如今天早上的收益新聞稿表3 中詳述的那樣）之外，毛利率還受到一次性130 萬美元或0.6% 的過渡費用的影響，這些費用與近期對某有些業務進行策略性遷移有關，預期年化收益節省 710 萬美元。除了圖表 3 中詳述的項目之外，第二財季的毛利率還受到新業務引入的 270 萬美元或 1.3% 一次性費用的影響，正如我之前強調的那樣。

Aside from higher sales volume, particularly from certain of our newer product offerings, which supports increased absorption of costs, we're also focused on other initiatives to enhance gross margins. Due in part to a $5.4 million noncash mark-to-market foreign exchange loss compared with a $4.8 million noncash mark-to-market foreign exchange loss in the prior year, operating expenses were $28.8 million compared with $27.2 million last year. For those of you who are not familiar with our operations, our leases in Mexico are US dollar-denominated leases.

除了更高的銷售量（特別是我們某些新產品的銷售量，這有助於增加成本的吸收）之外，我們還專注於提高毛利率的其他措施。部分由於非現金以市價計價外匯損失為 540 萬美元，而上一年非現金以市價計價外匯損失為 480 萬美元，營運費用為 2,880 萬美元，而去年為 2,720 萬美元。對於那些不熟悉我們業務的人來說，我們在墨西哥的租賃是以美元計價的租賃。

However, the leases are recorded in pesos at our Mexico subsidiary. As a result, the fixed US dollar lease, which are paid in US dollars, are remeasured at the end of every period to reflect the current exchange rate, resulting in a $4 million noncash foreign exchange impact of lease liabilities for the second quarter.

然而，我們墨西哥子公司的租賃以比索記錄。因此，以美元支付的固定美元租賃在每個期末都會重新計量，以反映當前匯率，導致第二季租賃負債產生 400 萬美元的非現金外匯影響。

Additionally, the company purchases forward peso contracts, which are also remeasured at the end of every period to reflect the current exchange rate, which resulted in a $1.4 million noncash foreign exchange impact of forward contracts for the fiscal second quarter.

此外，該公司購買遠期比索合約，並在每個期末重新計量以反映當前匯率，這導致第二財季遠期合約的非現金外匯影響為 140 萬美元。

I might add that we are in the process of analyzing reducing exposure to the foreign exchange impact of lease liabilities contracts. I should note that excluding these noncash items above, operating expenses increased by $878,000 to $23.3 million compared with $22.5 million a year earlier, primarily due to timing of certain expenses.

我想補充一點，我們正在分析減少租賃負債合約的外匯影響風險敞口。我應該指出，排除上述這些非現金項目，營運費用增加了 878,000 美元，達到 2,330 萬美元，而去年同期為 2,250 萬美元，這主要是由於某些費用的時間安排。

Interest expense for the fiscal second quarter decreased by $1.2 million to $14.2 million from $15.4 million a year ago, primarily due to lower average outstanding balances under the company's credit facility and lower interest rates. Interest expense includes accounts receivable discount program interest of $9.4 million for the fiscal '25 second quarter compared with $9.7 million for the prior year period.

第二財季的利息支出從去年同期的 1,540 萬美元減少到 1,420 萬美元，減少了 120 萬美元，主要是由於公司信貸安排下的平均未償餘額減少和利率下降。利息支出包括 25 財年第二季的應收帳款折扣計劃利息 940 萬美元，而去年同期為 970 萬美元。

For the second quarter, income tax expense was $912,000 compared with $46,000 income tax benefit for the prior year. The effective tax rate for the fiscal second quarter was due in part to the inability to recognize the benefit of losses at specific jurisdictions. However, we expect these losses will be utilized against future profits, which will benefit future tax rates. Obviously, there are various factors impacting the tax effect.

第二季所得稅費用為 912,000 美元，而前一年的所得稅優惠為 46,000 美元。第二財季的有效稅率部分是由於無法確認特定司法管轄區的虧損收益。然而，我們預計這些損失將用於抵消未來利潤，這將有利於未來的稅率。顯然，影響稅收效果的因素是多方面的。

Net loss for the fiscal '25 second quarter was $3 million or $0.15 per share, impacted by noncash expenses of $8 million or $0.40 per share, and onetime cash expenses of $1.1 million or $0.06 per share compared with net loss of $2 million or $0.10 per share a year ago, impacted by various items detailed in Exhibit 1 in this morning's earnings press release. In addition to these items, as previously explained, results for the current quarter were also impacted by $2.7 million or $0.10 per share of certain onetime expenses for onboarding new business.

25財年第二季的淨虧損為300萬美元或每股0.15美元，受到800萬美元或每股0.40美元的非現金費用以及110萬美元或每股0.06美元一次性現金費用的影響，而淨虧損為200萬美元或每股0.10美元一年前的股價，受到今天上午收益新聞稿中圖表 1 詳細說明的各種項目的影響。除了這些項目之外，如前所述，本季的業績還受到 270 萬美元或每股 0.10 美元的某些一次性新業務啟動費用的影響。

As previously explained, higher sales volume and operating efficiencies will further improve results. EBITDA for the fiscal second quarter was $14.7 million, reflecting the $10.6 million impact of noncash expenses and $1.5 million in onetime cash expenses detailed in Exhibit 5 of this morning's earnings press release. EBITDA before the impact of noncash and cash expenses mentioned above was $26.8 million for the second quarter despite the impact of certain onetime expenses of $2.7 million for onboarding new business.

如前所述，更高的銷售量和營運效率將進一步改善業績。第二財季的 EBITDA 為 1,470 萬美元，反映了今天早上收益新聞稿的圖表 5 中詳述的 1,060 萬美元非現金支出和 150 萬美元一次性現金支出的影響。儘管受到新業務開展的某些一次性費用 270 萬美元的影響，第二季在扣除上述非現金和現金費用影響之前的 EBITDA 為 2,680 萬美元。

Now let me discuss the 6-month results. Net sales for the fiscal '25 6-month period increased 6.1% to a record $378.1 million from $356.3 million. Gross profit for the fiscal '25 6-month period increased to a record $70.5 million from $67.7 million a year earlier. Gross margin for the fiscal '25 6-month period was 18.6% compared with 19% a year earlier. Gross margin for the fiscal '25 6-month period was impacted by $6.9 million or 1.8% of noncash expenses and $1.3 million or 0.3% of onetime cash expenses as detailed in Exhibit 4.

現在讓我討論一下 6 個月的結果。25 財年 6 個月期間的淨銷售額成長了 6.1%，從 3.563 億美元增至創紀錄的 3.781 億美元。25 財年 6 個月期間的毛利從去年同期的 6,770 萬美元增至創紀錄的 7,050 萬美元。2025 財年 6 個月期間的毛利率為 18.6%，去年同期為 19%。25 財年 6 個月期間的毛利率受到 690 萬美元（即非現金支出的 1.8%）和 130 萬美元（即一次性現金支出的 0.3%）的影響，詳見圖表 4。

In addition to the items detailed in Exhibit 4, gross profit for the current 6-month period was also impacted by $2.7 million or 0.7% of certain onetime expenses for onboarding new business. Net loss for the fiscal '25 6-month period was $21 million or $1.07 per share impacted by noncash expenses of $17.4 million or $0.88 per share, and onetime cash expenses of $3.3 million or $0.17 per share compared with a net loss of $3.4 million or $0.17 per share a year ago, impacted by various items detailed in Exhibit 2 in this morning's earnings press release.

除了圖表 4 中詳述的項目外，目前 6 個月期間的毛利還受到 270 萬美元或新業務開展的某些一次性費用的 0.7% 的影響。25 財年6 個月期間的淨虧損為2,100 萬美元或每股1.07 美元，受非現金支出1,740 萬美元或每股0.88 美元以及一次性現金支出330 萬美元或每股0.17 美元的影響，而淨虧損為340 萬美元或每股1.07 美元。

In addition to these items, as previously explained, results for the current 6-month period were also impacted by $2.7 million or $0.10 per share of certain onetime expenses for onboarding new business. EBITDA for the fiscal '25 6-month period was $13.6 million. EBITDA was impacted by $23.2 million of noncash expenses as well as $4.4 million in onetime cash expenses detailed in Exhibit 5 of this morning's earnings press release. EBITDA before the impact of noncash and cash expenses mentioned above was $41.3 million for the current period despite the impact of certain onetime $2.7 million of expenses for onboarding new business.

除了這些項目之外，如前所述，目前 6 個月期間的業績還受到 270 萬美元或每股 0.10 美元的某些一次性新業務啟動費用的影響。2025 財年 6 個月期間的 EBITDA 為 1,360 萬美元。EBITDA 受到 2,320 萬美元非現金支出以及 440 萬美元一次性現金支出的影響，詳見今天上午收益新聞稿的圖表 5。儘管受到某些一次性的 270 萬美元新業務啟動費用的影響，但本期在扣除上述非現金和現金費用影響之前的 EBITDA 為 4,130 萬美元。

Now, we will move on to cash flow and key corporate items. The company generated cash of approximately $22.9 million in operating activities during the fiscal '25 second quarter. We anticipate an increase in operating profit and gross margin on a year-over-year basis for fiscal '25 and the generation of positive cash flow for the year, supported by organic growth from customer demand and operating efficiencies from our global footprint expansion.

現在，我們將繼續討論現金流和關鍵公司專案。該公司在 2025 財年第二季的營運活動中產生了約 2,290 萬美元的現金。我們預計，在客戶需求的有機成長和我們全球業務擴張帶來的營運效率的支持下，25 財年的營業利潤和毛利率將同比增長，並在本年度產生正現金流。

In addition to our goal of generating increased operating profits, we are diligently focused on opportunities to neutralize working capital, including customer product demand planning, enhanced inventory management and further extending our vendor payment terms. We expect increasing financial performance from both new and existing product lines, including our emerging brake categories.

除了增加營業利潤的目標外，我們還努力尋找抵銷營運資金的機會，包括客戶產品需求規劃、加強庫存管理以及進一步延長供應商付款條件。我們預計新產品線和現有產品線（包括我們新興的煞車類別）的財務表現都會提高。

Net bank debt was $114.3 million at the end of the quarter compared with $136.3 million at June 30, 2024, and $114 million as of March 31, 2024. Total cash and availability was approximately $105 million. I should mention that for every 1 point reduction in interest rates, interest expense for accounts receivable discount programs offered by customers is reduced by approximately $6 million. For further explanation on the reconciliation of items that impacted results and non-GAAP financial measures, please refer to Exhibits 1 through 5 in this morning's earnings press release.

截至本季末，銀行淨債務為 1.143 億美元，而截至 2024 年 6 月 30 日為 1.363 億美元，截至 2024 年 3 月 31 日為 1.14 億美元。現金和可用資金總額約為 1.05 億美元。值得一提的是，利率每降低1個點，客戶提供的應收帳款折扣計畫的利息支出就會減少約600萬美元。有關影響績效的項目和非 GAAP 財務指標的進一步說明，請參閱今天上午的收益新聞稿中的圖表 1 至圖表 5。

I would now like to open the line for questions.

我現在想開通提問熱線。

(Operator Instructions)

（操作員說明）

Bill Dezellem, Tieton Capital.

比爾·德澤勒姆，泰頓資本。

Thank you. First of all, would you please walk us through the increased guidance for operating income from that $62 million to $67 million range that you had originally and now $79 million to $84 million. And what changed to lead to that increase?

謝謝。首先，請您向我們介紹將營業收入從原來的 6,200 萬美元提高到 6,700 萬美元，現在提高到 7,900 萬美元到 8,400 萬美元。是什麼變化導致了這種成長？

Thank you for that question. So, there is no change in the net operating income because previously, we gave the guidance, as you mentioned, $62 million to $67 million, but we also highlighted there will be $17 million of noncash items. So, what we did was we combined the amount. So, if you had $17 million, the previous $62 million and $67 million, it results in the $79 million to the $84 million. Does that make sense?

謝謝你提出這個問題。因此，淨營業收入沒有變化，因為正如您所提到的，我們之前給出了 6,200 萬至 6,700 萬美元的指導，但我們也強調將有 1,700 萬美元的非現金項目。所以，我們所做的就是將金額合併起來。因此，如果您有 1700 萬美元，之前的 6200 萬美元和 6700 萬美元，則結果是 7900 萬美元到 8400 萬美元。這樣有道理嗎？

It does. Okay. Great. Thank you. And then secondarily, I believe in the release, you referenced ordering activity was gaining momentum. So, I'm looking for a little more perspective behind that. Were there specific customers that that's referring to? Was it specific product lines? Is this counter to -- it seems like this is counter to the normal seasonal inventory declines that your customers have. So, some perspective behind that, please.

確實如此。好的。偉大的。謝謝。其次，我相信在發布中，您提到訂購活動正在獲得動力。所以，我正在尋找更多的視角。這是否指的是特定的客戶？是具體的產品線嗎？這是否與您的客戶的正常季節性庫存下降相反？那麼，請談談這背後的一些觀點。

Yeah. I mean, we're seeing -- in our two main categories, we're seeing a pretty vibrant demand. We've had a strong start to this quarter as well. And I might add, Bill, that this is in light of a pretty soft market out there. I mean, we just come back from the Apex, and I think it's fairly unanimous that people are generally experiencing softness.

是的。我的意思是，我們看到——在我們的兩個主要類別中，我們看到了非常活躍的需求。本季我們也有一個好的開始。比爾，我想補充一點，這是考慮到市場相當疲軟。我的意思是，我們剛從頂點回來，我認為人們普遍感到疲軟是相當一致的。

So, I'm excited to be able to say that. I mean, I think that if the market was stronger, we would even see greater opportunity. I think our product lines are holding them nondiscretionary and they're holding their own. And in particular, in the brake caliper line, just the programs that we offer are very strong, and I think they're picking share. So that continues on.

所以，我很高興能夠這麼說。我的意思是，我認為如果市場更強勁，我們甚至會看到更大的機會。我認為我們的產品線讓它們具有非自由裁量權，而它們擁有自己的產品線。特別是，在煞車卡鉗系列中，我們提供的程序非常強大，我認為他們正在搶奪份額。就這樣繼續下去。

We're seeing a bottom out as well. I think what I'm hearing the industry say within the next sort of February timeframe, seems like there's a bottom out in the opportunity on the tire replacement and sort of the brake category, I think, has bottomed out. And so, we should see a further pickup there. So, lots of updates in terms of we were introducing new part numbers. So, a lot of that activity.

我們也看到了觸底反彈。我認為我在接下來的二月時間範圍內聽到業界所說的，輪胎更換和煞車類別的機會似乎已經觸底，我認為，已經觸底。因此，我們應該會看到那裡的進一步回升。因此，我們在引入新零件號碼方面進行了大量更新。所以，很多這樣的活動。

So, in general, I think despite a relatively soft market, which, by the way, I think is very temporary, all the statistics continue to be positive. We're holding our own, and we expect tailwinds in the winds to change and tailwinds to further increase this.

因此，總的來說，我認為儘管市場相對疲軟（順便說一句，我認為這是非常暫時的），但所有統計數據仍然是積極的。我們正在堅持自己的立場，我們預期風向會發生變化，而順風會進一步加劇這種情況。

Great. Thank you. And then just a little more color on this, if you would, please. Are you finding it's pretty much across the board customer-wise that you're having this order momentum? Or does it tend to be with one or two customers?

偉大的。謝謝。如果你願意的話，請再在上面多一點顏色。您是否發現您的訂單動能幾乎是全面的客戶明智？還是往往只有一兩個顧客？

You know, our top 5 customers are huge contributors to all of our trends. So, I would say in the majority of that top 5, we're seeing that coming from different categories within what we supply to those top 5 customers. So, I think different customers are experiencing different success with different initiatives. And so, but rotating electrical and brake calipers in particular, the standouts.

您知道，我們的前 5 位客戶是我們所有趨勢的巨大貢獻者。因此，我想說，在前 5 名客戶中的大部分中，我們看到這些產品來自我們向前 5 名客戶提供的產品中的不同類別。因此，我認為不同的客戶透過不同的措施獲得了不同的成功。因此，旋轉電動卡鉗和煞車卡鉗尤其引人注目。

Great. Thank you for the color and perspective.

偉大的。謝謝你的色彩和視角。

(Operator Instructions)

（操作員說明）

Bill Dezellem, Tieton Capital.

比爾·德澤勒姆，泰頓資本。

Thank you. I'm going to jump in with a couple more, if I may now, please. So, you had the $1.3 million of transition costs. Would you talk about what operations were moved from where to where?

謝謝。如果可以的話，我要再加入幾個。因此，您需要承擔 130 萬美元的過渡成本。您能談談哪些業務從一個地方轉移到了另一個地方嗎？

Yeah. So, the last -- for a long time, we talked about how we got affected from COVID when Malaysia was closed down for 30 days, and we had to take in tapered baring wheel hubs into the USA because we didn't want to be the importer of record into Mexico.

是的。所以，最後——很長一段時間，我們都在談論當馬來西亞封鎖 30 天時我們如何受到新冠病毒的影響，我們不得不將錐形裸露輪轂帶入美國，因為我們不想墨西哥的記錄進口商。

So, moving that out of the Torrance facility was the last step in getting through that (inaudible) So, a lot of margin accretion will come to the wheel hub business as a result of that. And then in addition to that, there were ongoing special order activities relating to rotating electrical, mostly in conjunction with supplying our original equipment service program to some of the OE -- the big OE manufacturers.

因此，將其移出托倫斯工廠是解決這個問題的最後一步（聽不清楚）因此，輪轂業務將因此獲得大量利潤成長。除此之外，還有與旋轉電氣相關的特殊訂單活動正在進行，主要是與向一些 OE（大型 OE 製造商）提供我們的原始設備服務計劃相關。

And so, we were able to get that relocated as well. So, we're now in the process of evaluating the subleasing alternatives for the space. So, we'll see how the market is and what happens. But we're optimistic. We have a below-market rental, and so we think we have a nice opportunity.

因此，我們也能夠將其重新安置。因此，我們現在正在評估該空間的轉租替代方案。因此，我們將看看市場如何以及會發生什麼。但我們很樂觀。我們的租金低於市場水平，所以我們認為我們有一個很好的機會。

That's helpful. And Selwyn, what is remaining in Torrance now in terms of operations besides offices?

這很有幫助。塞爾溫（Selwyn），除了辦公室之外，現在托蘭斯還剩下什麼營運？

Well, we still have our engineering operations. So, a lot of our testing and diagnostic center and our content development center remains in Torrance. So definitely, for new product and new part introductions, we do significant test quality testing on our products way beyond in my opinion, what the aftermarket. We're in the levels of an OE type player on our quality levels, and we're proud of that, and that helps separate us. And that happens in Torrance.

好吧，我們仍然有我們的工程業務。因此，我們的許多測試和診斷中心以及內容開發中心仍然留在托倫斯。因此，毫無疑問，對於新產品和新零件的推出，我們對我們的產品進行了重要的測試品質測試，在我看來，遠遠超出了售後市場的範圍。我們的品質水準處於 OE 型玩家的水平，我們為此感到自豪，這有助於我們脫穎而出。這發生在托倫斯。

And then in addition to that, we have a tech center, and they go hand-in-hand with each other, but our tech center is where we develop many of our training materials and videos and 3D content. And one of the things that we do is we do live installs. So we're continuously checking applications against live vehicles. So our testers are very reliable, but we embellish that with testing on the actual vehicles.

除此之外，我們還有一個技術中心，它們彼此齊頭並進，但我們的技術中心是我們開發許多培訓材料、影片和 3D 內容的地方。我們所做的事情之一就是進行即時安裝。因此，我們不斷針對即時車輛檢查應用程式。因此，我們的測試人員非常可靠，但我們透過在實際車輛上進行測試來完善這一點。

So we have a service center that is a full-blown education center with stadium seating and an ability where our customers can see examples and demonstrations of different installations procedures, and that's all in Torrance still, and just our regular corporate headquarters as well, administration.

因此，我們有一個服務中心，它是一個成熟的教育中心，配有體育場座位，我們的客戶可以看到不同安裝程序的示例和演示，而這一切仍然在托倫斯，也是我們常規的公司總部、管理部門。

Great. Thank you. And then this quarter, you specifically called out $2.7 million of onetime expenses to onboard new business. I don't think I have seen expenses tied with onboarding of new business in the past. Would you detail what that was and what product line and the circumstances around it, please?

偉大的。謝謝。然後在本季度，您特別為新業務的開展一次性支出了 270 萬美元。我認為我過去沒有見過與新業務的開展相關的費用。請您詳細說明那是什麼、什麼產品線以及周圍的情況？

Yeah. So it's a new rotating electrical business and with a significant customer, and that will begin shipping. Normally, these expenses in conjunction with the starter business. This was a little in advance. So that business will start in January. And it's a good business. The return on capital on that business is certainly in the 40% to 50% range or higher. So we're excited about that.

是的。因此，這是一個新的旋轉電力業務，擁有重要的客戶，並將開始發貨。通常，這些費用與啟動業務相關。這有點提前了。所以這項業務將於一月開始。這是一門好生意。該業務的資本回報率肯定在 40% 到 50% 甚至更高。所以我們對此感到興奮。

Is this with a new customer?

這是新客戶嗎？

An existing customer. New business with an existing customer.

現有客戶。與現有客戶的新業務。

Great. Thank you. And then one additional --

偉大的。謝謝。然後再加一張--

We're getting to the point, Bill, where we have a lot of customers now. So most of the new business is with existing customers. So yeah.

比爾，我們現在已經有很多客戶了。因此，大部分新業務都是針對現有客戶。所以是的。

Yeah. I had one specific one in mind that I was wondering about. Okay. Thank you. And relative to price increases, you had several. Are there additional rounds of price increases that are in place now?

是的。我心裡有一個我想知道的具體問題。好的。謝謝。相對於價格上漲，你有幾個。現在是否還有新一輪的漲價？

We have one price increase that we're expecting in January. But the market today is stabilized on that. I mean, we continue to fight for price. I mean, I think that when you have weakness in the industry, it becomes much more challenging to get the price increases that perhaps you deserve.

我們預計在一月份會有一次價格上漲。但今天的市場已經穩定下來。我的意思是，我們繼續爭取價格。我的意思是，我認為當你在行業中處於弱勢時，獲得你應得的價格上漲就變得更具挑戰性。

But we continue on, and we're excited about margin accretion opportunities. And I think as we get into the next quarter, we'll start outlining them in a little more detail for everybody. But we're making some great progress on emerging newer product lines that will help margins.

但我們會繼續前進，我們對利潤增加的機會感到興奮。我認為，當我們進入下一個季度時，我們將開始為每個人更詳細地概述它們。但我們在新興產品線方面取得了一些重大進展，這將有助於提高利潤。

And Selwyn, the magnitude of that price increase, I'm really trying to gauge the impact on the total business.

塞爾溫，價格上漲的幅度，我真的在努力評估對整個業務的影響。

Yeah. I think it's all in the guidance right now, Bill. I'd rather not get into the details of that at this point, but it's all in the guidance numbers. And certainly, as we give you more visibility on the next fiscal, you'll see more of that.

是的。我認為現在一切都在指導中，比爾。我現在不想詳細討論這一點，但這一切都在指導數字中。當然，當我們為您提供更多關於下一財年的資訊時，您會看到更多。

Okay. That's fine. I'll let you take a pass on that one if you will give a little bit more perspective on, or an update on the individual that you hired here several months ago who has lots of experience in the professional installer business.

好的。沒關係。如果您願意對幾個月前在這裡僱用的在專業安裝人員業務方面擁有豐富經驗的人提供更多一點的看法或更新信息，我會讓您通過這個人。

Yeah. So not sure what to comment, but that business is growing. We further added to our team there, and we're seeing to use upon great traction from that business.

是的。所以不知道該評論什麼，但該業務正在成長。我們進一步增加了那裡的團隊，並且我們看到該業務的巨大吸引力。

I will now turn the call back over to Selwyn Joffe, CEO, for closing remarks.

現在，我將把電話轉回給執行長 Selwyn Joffe，讓其致閉幕詞。

Okay. I think Bill may have got cut off there. I'm not sure. But yeah. Okay. But thank you. In summary, we are bullish. I'll restate, we're bullish as we begin the second half of the fiscal year. We are laser-focused on further efficiencies and fully benefiting from a not-easily duplicated global platform to meet demand for nondiscretionary products as well as from our diagnostic testing capabilities. We are leveraging our expertise and solid customer and supplier partnerships. This includes our supply chain vendor finance program that benefits our suppliers.

好的。我想比爾可能在那裡被切斷了。我不知道。但是是的。好的。但謝謝你。總而言之，我們看好。我重申一下，在本財年下半年開始之際，我們持樂觀態度。我們專注於進一步提高效率，並充分受益於不易複製的全球平台，以滿足對非自由裁量產品的需求以及我們的診斷測試能力。我們正在利用我們的專業知識以及牢固的客戶和供應商合作夥伴關係。這包括我們的供應鏈供應商融資計劃，該計劃使我們的供應商受益。

Our liquidity is strong, and we have the resources, capacity and professional expertise to capitalize on significant market opportunities in all of our product lines. In closing, I must recognize the contributions of all of our team members who are continuously focused on providing the highest level of service.

我們的流動性很強，我們擁有資源、能力和專業知識來利用我們所有產品線的重大市場機會。最後，我必須感謝我們所有團隊成員的貢獻，他們不斷致力於提供最高水準的服務。

We are all committed to being the industry leader for the parts and solutions that move our world today and in the future. We also appreciate the continued support of shareholders and thank everyone again for joining us on the call. We look forward to speaking with you when we host our fiscal 2025 third quarter call in February and at various investor conferences and meetings this fall/winter. Thank you very much.

我們都致力於成為推動當今和未來世界發展的零件和解決方案的行業領導者。我們也感謝股東的持續支持，並再次感謝大家加入我們的電話會議。我們期待在 2 月舉辦 2025 財年第三季電話會議以及今年秋冬的各種投資者大會和會議時與您交談。非常感謝。

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.

女士們、先生們，今天的電話會議到此結束。感謝大家的加入。您現在可以斷開連線。