Pro-Dex Inc (PDEX) 2014 Q1 法說會逐字稿

Greetings, and welcome to the Pro-Dex fiscal 2014 first-quarter conference call. At this time, all participants are in a listen-only mode. A brief question-answer-session will follow the formal presentation. (Operator Instructions). As a reminder, this conference is being recorded.

您好，歡迎參加 Pro-Dex 2014 財年第一季度電話會議。此時，所有參與者都處於只聽模式。正式演講之後將進行簡短的問答環節。 （操作員說明）。提醒一下，本次會議正在錄製中。

It is now my pleasure to introduce your host, Hal Hurwitz, Chief Executive Officer and Chief Financial Officer. Thank you. Mr. Hurwitz, you may begin.

現在我很高興向大家介紹東道主哈爾·赫維茨（Hal Hurwitz），他是首席執行官兼首席財務官。謝謝。赫爾維茨先生，您可以開始了。

Thank you, LaTanya, and thank you all for joining us to review the results for the fiscal 2014 first-quarter ended September 30, 2013. On today's call, I will provide a synopsis of our operating results as well as some comments. Then, as LaTanya mentioned, we will open up the call for your questions.

謝謝 LaTanya，也感謝大家與我們一起回顧截至 2013 年 9 月 30 日的 2014 財年第一季度的業績。在今天的電話會議上，我將提供我們的經營業績概要以及一些評論。然後，正如 LaTanya 提到的，我們將開啟電話詢問您的問題。

Before beginning, however, I ask our participants and listeners to note that the comments made on this call may include statements that are forward-looking within the meaning of securities laws. These forward-looking statements may include, without limitation, statements related to anticipated industry trends and the company's plans, products, perspectives, and strategies, both preliminary and projected. Actual results or trends could differ materially. We undertake no obligation to revise or publicly revise the results of any revision to the forward-looking statements in light of new information or future events. For more information, please refer to the risk factors discussed in the company's Form 10-K for the year ended June 30, 2013 which has been filed with the SEC, the Form 10-Q for the quarter ended September 30, 2013 filed with the SEC today, and the Form 8-K filed with the SEC today, along with the attached press release issued today, all of which can be obtained from the SEC or by visiting our website at www.pro-dex.com.

然而，在開始之前，我請我們的參與者和聽眾注意，本次電話會議中發表的評論可能包括證券法含義內的前瞻性陳述。這些前瞻性陳述可能包括但不限於與預期行業趨勢以及公司的初步和預計的計劃、產品、觀點和戰略相關的陳述。實際結果或趨勢可能存在重大差異。我們不承擔根據新信息或未來事件修改或公開修改前瞻性陳述的任何修改結果的義務。欲了解更多信息，請參閱公司向SEC 提交的截至2013 年6 月30 日止年度的10-K 表格、向美國證券交易委員會提交的截至2013 年9 月30 日止季度的10-Q 表格中討論的風險因素。今天向 SEC 提交的 8-K 表格以及今天發布的隨附新聞稿，所有這些都可以從 SEC 獲取或訪問我們的網站 www.pro-dex.com。

And now, let's cover the first quarter's results. Sales for the quarter ended September 30, 2013 decreased 26% to $2.6 million from $3.5 million for the corresponding quarter in 2012. This decrease was due primarily to a deferral in the timing of product orders from our current largest powered surgical instrument customer, partially offset by increases in surgical instrument sales to other customers and to a decrease in motion control product sales.

現在，讓我們來看看第一季度的業績。截至 2013 年 9 月 30 日的季度銷售額從 2012 年同期的 350 萬美元下降 26% 至 260 萬美元。這一下降主要是由於我們當前最大的動力手術器械客戶的產品訂單時間推遲，部分抵消了由於向其他客戶的手術器械銷售增加以及運動控制產品銷售減少。

Gross profit for the quarter ended September 30, 2013 decreased to $945,000 compared to gross profit of $1.2 million for the year-ago period, primarily as a result of the sales volume decrease between periods partially offset by a decrease in product warranty costs. Gross profit as a percentage of sales was 37% for the quarter ended September 30, 2013 as compared to 36% for the corresponding quarter in 2012, resulting primarily from improvements in production efficiency.

截至2013年9月30日的季度毛利潤下降至945,000美元，而去年同期毛利潤為120萬美元，這主要是由於各時期之間銷量的下降被產品保修成本的下降所部分抵消。截至2013年9月30日的季度，毛利潤佔銷售額的百分比為37%，而2012年同期為36%，這主要歸功於生產效率的提高。

Operating expenses, which include selling, general and administrative, and research and development expenses, for the quarter ended September 30, 2013 decreased 28% to $924,000 from $1.3 million in the prior year's corresponding quarter, reflecting the effects of our cost reduction program.

截至 2013 年 9 月 30 日的季度，運營費用（包括銷售費用、一般管理費用以及研發費用）從去年同期的 130 萬美元下降了 28% 至 924,000 美元，反映了我們成本削減計劃的效果。

Income from continuing operations for the quarter ended September 30, 2013 was $18,000 compared to a loss from continuing operations of $59,000 in the corresponding quarter in 2012. Net income for the quarter ended September 30, 2013 was $212,000, or $0.06 per diluted share, compared to a net loss of $17,000 or $0.01 per diluted share for the corresponding quarter in 2012. The 2013 quarter reflects the $167,000 gain from the previously announced sale in July 2013 of our facility in Carson City, Nevada that had housed our former Astromec fractional horsepower motor business which we account for as a discontinued operation.

截至2013 年9 月30 日的季度的持續經營收入為18,000 美元，而2012 年同期的持續經營虧損為59,000 美元。截至2013 年9 月30 日的季度的淨利潤為212,000 美元，或攤薄後每股收益0.06 美元。 2012 年相應季度的淨虧損為17,000 美元，即攤薄後每股虧損0.01 美元。2013 年季度反映了之前宣布的2013 年7 月出售我們位於內華達州卡森市的工廠帶來的167,000美元收益，該工廠曾安置我們的前Astromec 分馬力發動機我們將其視為已終止經營的業務。

During the quarter ended September 30, 2013, we used $512,000 of cash in operating activities. This use of cash primarily reflects payments we made during the quarter in satisfaction of inventory purchases we made during the year ended June 30, 2013. As we have previously discussed, inventory was built up during fiscal 2013 with the objective of shortening lead times for many of our products.

在截至 2013 年 9 月 30 日的季度中，我們在經營活動中使用了 512,000 美元的現金。這種現金使用主要反映了我們在本季度支付的款項，以滿足我們在截至2013 年6 月30 日的年度中進行的庫存採購。正如我們之前所討論的，庫存是在2013 財年期間建立的，目的是縮短許多產品的交貨時間。我們的產品。

In the fourth quarter of fiscal 2013, the company's largest customer began deferring the timing of its product orders. This deferral has continued into the current fiscal year, thus prolonging the effect of the inventory buildup, much of which is represented by components unique to that customer's product. Our customer and we are in discussion with the objective of arriving at a mutually acceptable timetable for the customer's fulfillment of its orders under the terms of its frame contract with us.

2013財年第四季度，該公司最大的客戶開始推遲其產品訂單的時間。這種推遲一直持續到本財年，從而延長了庫存積累的影響，其中大部分是由該客戶產品特有的組件所代表的。我們和客戶正在進行討論，目標是達成一個雙方都能接受的時間表，以便客戶根據與我們簽訂的框架合同條款履行其訂單。

During the quarter, we invested an additional $228,000 in our portfolio of public company equity securities, bringing the total amount we have invested to $593,000 at September 30, 2013. The market value of these investments at September 30, 2013 was $654,000, representing accumulated unrealized gains of $61,000 since we commenced investing in June 2013.

本季度，我們在上市公司股本證券投資組合中追加投資了228,000 美元，截至2013 年9 月30 日，我們的投資總額達到593,000 美元。截至2013 年9 月30 日，這些投資的市場價值為654,000 美元，相當於累計未實現的金額。自 2013 年 6 月開始投資以來，我們已獲得 61,000 美元的收益。

Also during the quarter, we receive net proceeds of $900,000 from the sale of our former facility in Carson City, Nevada. As a result of the foregoing, cash on hand at September 30, 2013 was $1.8 million compared to $1.7 million at June 30, 2013.

同樣在本季度，我們通過出售位於內華達州卡森市的前工廠獲得了 900,000 美元的淨收益。由於上述原因，2013 年 9 月 30 日的手頭現金為 180 萬美元，而 2013 年 6 月 30 日的手頭現金為 170 萬美元。

Now, for some brief commentary. As I stated in today's press release, it is good to report profitable operating results again. Of course, one quarter does not create or imply a trend. Even so, the operating results for the quarter ended the September 30, 2013 reflect a long, painful, and now rewarding process of rightsizing our cost footprint to our current revenue base.

現在，進行一些簡短的評論。正如我在今天的新聞稿中所說，再次報告盈利的經營業績是件好事。當然，四分之一併不創造或暗示一種趨勢。即便如此，截至 2013 年 9 月 30 日的季度運營業績反映了我們將成本足跡調整到當前收入基礎的長期、痛苦但現在回報豐厚的過程。

Without question, achieving the goal of a rebuilt revenue base is still ahead of us and we maintain our focus on that goal. During the quarter ended September 30, 2013, we continued to make significant progress on engineering projects with the goal to deliver to our customers in late fiscal 2014 or early fiscal 2015 a next-generation platform for powered surgical instruments in which we will retain significant intellectual property rights.

毫無疑問，重建收入基礎的目標仍然遙遙領先，我們將繼續關注這一目標。在截至2013 年9 月30 日的季度中，我們繼續在工程項目上取得重大進展，目標是在2014 財年末或2015 財年初向我們的客戶提供下一代動力手術器械平台，我們將在其中保留重要的知識產權。財產權。

Also during the quarter, we continued engineering work in collaboration with an existing customer on a contract manufacturing project related to a new surgical system, the development phase of which is also expected to culminate in the late fiscal 2014 or early fiscal 2015 timeframe.

同樣在本季度，我們繼續與現有客戶合作開展與新手術系統相關的合同製造項目的工程工作，該項目的開發階段預計將在 2014 財年末或 2015 財年年初完成。

As we have previously discussed, our sales cycle typically ranges from 18 months to two years from initial discussion through proposal submission to project commencement, not an unusual timeframe given the next-generation nature of our projects. This next-generation aspect, with its attendant technological challenges, also well explains the typical 18-months to two-year duration of the development phase of those projects that we have undertaken. The combined time span of the sales cycle and the development cycle thus accounts for the deliberate manner in which we believe the rebuilding of the diversified revenue base is taking shape.

正如我們之前所討論的，從最初討論到提案提交再到項目啟動，我們的銷售週期通常為18 個月到兩年不等，考慮到我們項目的下一代性質，這並不是一個不尋常的時間框架。下一代方面及其隨之而來的技術挑戰也很好地解釋了我們所承擔的這些項目的開發階段通常需要 18 個月到兩年的時間。因此，銷售週期和開發週期的總時間跨度說明了我們認為多元化收入基礎的重建正在形成的經過深思熟慮的方式。

On the front end of the sales cycle, we continue to actively pursue both our prospective customer contact base and the number of substantive meetings we have had with those prospective customers. Granted, there is no assurance that our efforts on this front end of the sales cycle will translate into customer contracts and purchase orders, but we are pleased with the opportunities that are before us in our proposal pipeline.

在銷售週期的前端，我們繼續積極爭取潛在客戶的聯繫基礎以及我們與這些潛在客戶舉行的實質性會議的數量。誠然，不能保證我們在銷售週期前端的努力將轉化為客戶合同和採購訂單，但我們對提案渠道中擺在我們面前的機會感到滿意。

With respect to the rightsizing of our cost footprint, we of course have greater control that has allowed us to realize the results of our efforts more quickly. Fiscal 2014 marks the first year in which the full effect of our cost reduction efforts of the past year will be reflected in our results. This said, our efforts in cost reduction and control are not yet complete. Nonetheless, year-over-year stability of gross margins despite lower sales volume together with year-over-year decreases of 66% in selling expenses, 25% in general and administrative expenses, and 8% in research and development expenses we believe clearly demonstrates how far we have come.

在調整成本足跡方面，我們當然擁有更大的控制權，這使我們能夠更快地實現我們的努力成果。 2014 財年是我們過去一年的成本削減努力的全部效果將在我們的業績中得到體現的第一年。儘管如此，我們在降本和控製成本方面的努力還沒有完成。儘管如此，儘管銷量較低，但毛利率同比保持穩定，而且我們認為銷售費用同比下降66%、一般及管理費用同比下降25%、研發費用同比下降8%，這清楚地表明了毛利率的穩定。我們已經走了多遠。

I am now happy to invite any questions you might have with regard to the quarter or our business operations. With that, I will turn the call back over to LaTanya for Q&A.

我現在很高興邀請您就本季度或我們的業務運營提出任何問題。這樣，我會將電話轉回 LaTanya 進行問答。

Thank you. We will now be conducting a question-and-answer session. (Operator Instructions). There are no questions in queue at this time. Do you have any closing comments for the group?

謝謝。我們現在將進行問答環節。 （操作員說明）。目前隊列中沒有問題。您對小組有什麼結束語嗎？

Yes. Thank you LaTanya. And my thanks to all of you for joining me today. All of us at Pro-Dex appreciate your interest, your time, and your support of the company, and we look forward to speaking with you in February 2014 when we report our fiscal 2014 second-quarter and first-half financial results. Thank you.

是的。謝謝拉塔尼亞。我感謝大家今天加入我的行列。 Pro-Dex 的全體員工感謝您對公司的興趣、時間和支持，我們期待在 2014 年 2 月報告 2014 財年第二季度和上半年財務業績時與您交談。謝謝。

Thank you. This does conclude today's teleconference. You may disconnect your lines at this time, and thank you for your participation.

謝謝。今天的電話會議到此結束。此時您可以斷開線路，感謝您的參與。