Polar Power Inc (POLA) 2019 Q3 法說會逐字稿

Good day and welcome to the Polar Power, Inc. Third Quarter 2019 Financial Results Conference Call. Today's conference is being recorded now at this time.

您好，歡迎來到 Polar Power, Inc.2019 年第三季財務業績電話會議。今天的會議目前正在錄製。

Now at this time, I would like to turn the conference over to Mr. Shawn Severson. Please go ahead, sir.

現在，我想將會議交給肖恩·塞弗森先生。先生，請繼續。

Thank you. And good afternoon, everyone. I'd like to thank you for taking the time to join us today for Polar Power's third quarter 2019 conference call. Hosts today, Arthur Sams, Polar Power's Chief Executive Officer; Raj Masina, COO; and Luis Zavala, Chief Financial Officer. Arthur will begin by providing a review of the key events in the quarter. This will then be followed by Raj who will provide an operational update as well as updates on key strategic objectives. After which, Luis will discuss the financial results.

謝謝。大家下午好。感謝您今天抽空參加 Polar Power 2019 年第三季電話會議。今天主持人是 Polar Power 的執行長 Arthur Sams； Raj Masina，營運長；以及財務長 Luis Zavala。亞瑟將首先回顧本季的關鍵事件。隨後，Raj 將提供營運最新動態以及關鍵策略目標的最新動態。之後，路易斯將討論財務結果。

A press release detailing this quarter's results crossed the wire today at 4:05 Eastern Time and is available on the company's website at www.polarpower.com. We would also encourage you to view the website for additional information, an overview of Polar Power's business as well as the LinkedIn page. Following management's prepared comments, we will open the call up for questions.

一份詳細介紹本季業績的新聞稿於今天東部時間 4:05 發布，可在公司網站 www.polarpower.com 上查閱。我們也鼓勵您造訪網站以獲取更多資訊、Polar Power 業務概述以及 LinkedIn 頁面。根據管理層準備好的評論，我們將開始提問。

Before we begin, I would like to remind everyone that statements made today on the call and webcast, including those regarding future financial results and industry projections, are forward-looking and may be subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the call. Please refer to the company's SEC filings for a list of associated risks, and we'll refer you to the company's website for more supporting industry information.

在我們開始之前，我想提醒大家，今天在電話會議和網路廣播中所作的聲明，包括有關未來財務業績和行業預測的聲明，都是前瞻性的，可能受到許多風險和不確定因素的影響，這些風險和不確定因素可能導致實際結果與電話會議中描述的結果存在重大差異。請參閱該公司的 SEC 文件以獲取相關風險列表，我們將引導您訪問該公司的網站以獲取更多支援行業資訊。

At this time, I'd turn the call over to Arthur Sams, Polar Power's CEO. Arthur?

這時，我會把電話轉給 Polar Power 的執行長 Arthur Sams。亞瑟？

Thank you, Shawn, and welcome, everyone, to Polar's Third Quarter 2019 Earnings Conference Call. During today's call, I'll briefly discuss our financial highlights for the quarter followed by an update on our business strategy. Luis will then provide greater financial details during this call.

謝謝肖恩，歡迎大家參加 Polar 2019 年第三季財報電話會議。在今天的電話會議上，我將簡要討論本季度的財務亮點，隨後介紹我們的業務策略的最新情況。路易斯隨後將在此次電話會議中提供更多財務細節。

A brief summary of the financial highlights. Revenues for the third quarter 2019 were $6.9 million. Backlog at the end of the third quarter was $3 million. Gross profit for the quarter stood at $2.2 million, and net income for the quarter totaled $25,000 -- $48,000, which is $0.00 basic and diluted share. So again, I'm correcting myself, at $48,000.

財務亮點的簡要摘要。2019 年第三季的營收為 690 萬美元。第三季末的積壓訂單為300萬美元。本季毛利為 220 萬美元，本季淨收入總計 25,000 - 48,000 美元，基本每股收益和攤薄每股收益為 0.00 美元。因此，我再次糾正自己，價格是 48,000 美元。

Now I'd like to provide you with the business update and review some of the key highlights for the quarter. Last quarter, we have initiated a strategic review of our business and strategy to make sure that we are optimizing our resources to pursue the best growth opportunities. For our basic strategic review, we're making some adjustments to our business plan and operations to better drive growth and diversification.

現在，我想向您提供業務更新並回顧本季的一些主要亮點。上個季度，我們開始對業務和策略進行策略審查，以確保我們優化資源來尋求最佳的成長機會。對於我們的基本策略審查，我們正在對我們的業務計劃和營運進行一些調整，以更好地推動成長和多元化。

Let me take a moment to remind everyone of our business model. We provide power and cooling solutions. We're not just a generator manufacturer. One of the major components for our solar hybrid micro-grid system is the generator set. Polar chose DC generator technology because the solar photovoltaic fuel cells and batteries are all exclusively DC. Also, DC micro-grids transmit power across businesses more efficiently than AC. Therefore, we believe that DC generators are more efficient than AC generators in modern micro-grids and solar hybrid systems.

讓我花點時間提醒大家我們的商業模式。我們提供電源和冷卻解決方案。我們不僅僅是一家發電機製造商。我們的太陽能混合微電網系統的主要部件之一是發電機組。Polar 公司之所以選擇直流發電機技術，是因為太陽能光電燃料電池和電池都是純直流的。此外，直流微電網在企業間傳輸電力的效率比交流微電網更高。因此，我們認為在現代微電網和太陽能混合系統中，直流發電機比交流發電機更有效率。

When an application requires AC power, for example, your home, a simple DC-to-AC converter is installed. Most solar photovoltaic homes already have DC-to-AC inverters installed. As solar hybrid system or micro-grid or distributed power generation becomes more prevalent, we believe that the industry will turn towards the high-end performance and reliability of DC generators, which is what we bring.

當應用需要交流電時（例如您的家庭），就會安裝一個簡單的直流-交流轉換器。大多數太陽能光電住宅已經安裝了直流-交流逆變器。隨著太陽能混合系統或微電網或分散式發電變得越來越普遍，我們相信產業將轉向直流發電機的高端性能和可靠性，這正是我們所帶來的。

We compete with traditional power sources of power based on performance. We're not always the lowest price from a capital expenditure standpoint, but we believe that we are among the lowest from an operational expenditure standpoint. We believe that our customers will recognize the long-term value of our products, including higher performance, lower operating cost, better reliability, lighter weight, smaller packages and lower maintenance.

我們以性能為依據與傳統電源進行競爭。從資本支出的角度來看，我們的價格並不總是最低的，但我們相信，從營運支出的角度來看，我們的價格是最低的價格之一。我們相信客戶會認可我們產品的長期價值，包括更高的性能、更低的營運成本、更好的可靠性、更輕的重量、更小的包裝和更低的維護。

I also want to reiterate our belief that the domestic telecom market is a compelling growth for Polar, including the last-mile carriers. As we explained in last quarter, we're experiencing a period of short-term volatility with our Tier 1 wireless communications carriers mostly centered around shifting budgets to 5G rollouts, mergers and acquisitions among the Tier 1. Also, there is an uncertainty as to how much backup power is actually required on the site. Now shipments and sales are being postponed to 2020. But even with this guidance from our Tier 1 wireless communications customers, we're continuing our focus on diversification and accelerating our targeting of last mile of rural carriers.

我還想重申我們的信念：國內電信市場（包括最後一哩路營運商）對 Polar 來說是一個引人注目的成長點。正如我們在上個季度所解釋的那樣，我們的一級無線通訊營運商正經歷一段短期波動時期，主要集中在將預算轉移到 5G 部署、一級運營商之間的合併和收購。現在出貨和銷售都延後到2020年。但即使有了一級無線通訊客戶的指導，我們仍將繼續專注於多元化，並加快瞄準農村營運商的最後一英里。

To facilitate this initiative, we're expanding our U.S. distribution network while introducing new products, including propane and natural gas generators powered by Toyota engines. We're also moving forward with our energy storage systems. Offering complete energy and cooling solutions, we believe, gives us the leading position in industry technology. Furthermore, we have recently completed and passed all of our emissions testing required by EPA and presently awaiting for certification to begin marketing our environmentally-friendly product line to both residential and commercial customers.

為了促進這項舉措，我們正在擴大美國分銷網絡，同時推出新產品，包括由豐田引擎驅動的丙烷和天然氣發電機。我們也在推進我們的能源儲存系統。我們相信，提供完整的能源和冷卻解決方案使我們在行業技術上處於領先地位。此外，我們最近完成並通過了美國環保署 (EPA) 要求的所有排放測試，目前正在等待認證，以便開始向住宅和商業客戶行銷我們的環保產品線。

Our strategy for targeting the domestic telecom market is a combination of direct sales and dealerships and leveraging our channel partners who are currently servicing our products. Tier 1 and approximately 12 of the larger last-mile telecom companies will continue as a direct account to Polar. The smaller last-mile carriers and emergency services using UHF and VHF radios will be sold through dealerships that can also offer service. Our plan is to include having the same dealerships offer our solar hybrid systems for off-grid and backup for all applications.

我們針對國內電信市場的策略是直銷和經銷商結合，並利用目前為我們的產品提供服務的通路合作夥伴。Tier 1 和大約 12 家較大的最後一哩電信公司將繼續直接向 Polar 提供服務。使用超高頻 (UHF) 和甚高頻 (VHF) 無線電的小型最後一英里運營商和緊急服務將透過也可提供服務的經銷商進行銷售。我們的計劃是讓相同的經銷商為所有應用提供用於離網和備用的太陽能混合系統。

As part of our strategic review, we are actively expanding into markets outside of the telecom market. It's noteworthy that telecom applications make up less than 15% of the sub-40 kilowatt generator sales among the large generator manufacturers. And most of their sales involve home and commercial backup power applications. Our market analysis after meeting with 30 of the largest LPG refineries and distribution companies indicates a significant interest in our solar hybrid LPG systems for telecom, industrial, residential and commercial uses. The recent power shutdown in California -- or shutdowns in California has outlined a significant opportunity for our new propane and natural gas product line. Now a quick note, LPG stands for liquid petroleum gas, and this is a term commonly used overseas. The fuel -- the LPG fuel is a combination of propane and butane. Domestically, in the U.S., we use propane 100%.

作為策略審查的一部分，我們正在積極擴展到電信市場以外的市場。值得注意的是，在大型發電機製造商中，電信應用佔40千瓦以下發電機銷量的不到15％。他們的大部分銷售涉及家庭和商業備用電源應用。在與 30 家最大的液化石油氣煉油廠和分銷公司會面後，我們進行了市場分析，結果表明，這些公司對我們用於電信、工業、住宅和商業用途的太陽能混合液化石油氣系統有濃厚興趣。加州最近的斷電——或者說加州的停電——為我們的新型丙烷和天然氣產品線帶來了重大機會。簡單說明一下，LPG 代表液化石油氣，這是海外常用的術語。燃料－液化石油氣燃料是丙烷和丁烷的混合物。在美國國內，我們 100% 使用丙烷。

Now moving on. The California fires and actions by the electric utilities to minimize the risk of their equipment causing fires has created an unstable grid in many residential areas. Generator companies have rushed in to fill the need with low-cost backup generators in the cost range of $4,000 to $9,000, and these generators are operating on either natural gas and propane or both. In a short period of time, we expect that many customers will discover that these low-cost backup generators will not meet their expectations due to low reliability and higher maintenance cost. The difference between moving forward with backup power is that we expect the outages to be longer -- of longer duration. Instead of being just a few minutes or a few hours, they can go in days at a time.

現在繼續。加州的火災以及電力公司為降低其設備引發火災的風險而採取的行動導致許多住宅區的電網不穩定。發電機公司紛紛湧入市場，推出價格在 4,000 至 9,000 美元之間的低成本備用發電機來滿足這一需求，這些發電機可以使用天然氣或丙烷，或者兩者兼而有之。我們預計，在短時間內，許多客戶會發現這些低成本的備用發電機由於可靠性低和維護成本較高而無法滿足他們的期望。使用備用電源的差異在於，我們預計停電時間會更長——持續時間更長。它們不再只是持續幾分鐘或幾小時，而是可以持續幾天。

Now as the high maintenance of the standard AC generators are centered around oil change and maintenance, so figure changing the oil every 8 days and an engine replacement every 200 days approximately when running 24 hours a day. In contrast, the Polar DC generator can operate up to 1 year between oil change and maintenance with an engine life of 7 years, operating 24 hours a day. Looking at other technologies, such as fuel cells, we're significantly more cost effective as changing the oil filters, spark plugs and cooling is a very small cost relative to fuel cell, whereas, changing the membrane is a very expensive event. I would also like to point out that we'll be offering systems that include waste heat recovery for space heating, hot water, pool and spa heating, making our solution even more energy efficient. Soon, we'll be able to offer micro-cogen systems, can make use of 80% of the fuel energy.

現在，由於標準交流發電機的高維護都集中在換油和維護上，因此，在每天 24 小時運行的情況下，大約每 8 天換一次油，每 200 天更換一次引擎。相比之下，Polar 直流發電機在換油和維護之間可以運行長達 1 年，引擎壽命為 7 年，每天 24 小時運行。看看其他技術，例如燃料電池，我們的成本效益明顯更高，因為更換機油濾清器、火星塞和冷卻器的成本相對於燃料電池來說非常小，而更換薄膜則是一項非常昂貴的事件。我還想指出，我們將提供包括空間加熱、熱水、泳池和水療加熱的廢熱回收系統，使我們的解決方案更加節能。很快，我們將能夠提供微型熱電聯產系統，可利用 80% 的燃料能量。

Our systems also connect with the solar PV array and uses a solar inverter to provide the AC power for the home appliances. So in other words, the DC generator acts like if it was another solar panel and feeds power along with the other solar panels into the inverter. We also believe that our new product launch will provide an optimal solution for charging electric vehicles. Many homes cannot fast charge their electric vehicles today. And soon, we expect in the near future, communities may not get enough energy from the grid to charge electric cars for residential and commercial power systems.

我們的系統還與太陽能光伏陣列相連，並使用太陽能逆變器為家用電器提供交流電。換句話說，直流發電機就像另一塊太陽能板一樣，將電力與其他太陽能板一起輸送到逆變器。我們也相信，我們新產品的推出將為電動車充電提供最佳解決方案。如今，許多家庭無法為電動車進行快速充電。而我們預計，在不久的將來，社區可能無法從電網獲取足夠的能源來為住宅和商業電力系統的電動車充電。

To accelerate our expansion into new markets and diversified customers, we have modified our organization to where our Chief Operating Officer, Raj Masina, will manage domestic and international sales. We recently significantly increased our production management personnel, allowing Raj to focus on sales. As a part of this plan, we're adjusting our international strategy to conduct even a narrower screening process and concentrating our focus on comprehensive power solutions. We plan to evaluate our international sales effort on an ongoing basis and focus efforts on the highest potential markets only.

為了加速我們向新市場和多元化客戶的擴張，我們調整了組織結構，由營運長 Raj Masina 負責管理國內和國際銷售。我們最近大幅增加了生產管理人員，以便 Raj 能夠專注於銷售。作為該計劃的一部分，我們正在調整我們的國際策略，以進行更狹窄的篩選流程，並將重點放在全面的電力解決方案上。我們計劃持續評估我們的國際銷售工作，並僅專注於最具潛力的市場。

In regard to the domestic market, we're expanding our sales infrastructure to reach new markets through strategic partnerships with our existing distribution networks. Over the past 12 months, we've been recruiting and training personnel to manage production sales and service. This is intended not only to improve manufacturing efficiencies but also free up more the senior management's time to focus on revenue-generating activities. This has been a work in progress, but now we're positioned to lever this investment going forward.

在國內市場方面，我們正在透過與現有分銷網絡建立策略合作夥伴關係來擴大我們的銷售基礎設施，以進入新市場。在過去的 12 個月裡，我們一直在招募和培訓人員來管理生產銷售和服務。這不僅是為了提高製造效率，還能讓高階管理層有更多的時間專注於創收活動。這項工作仍在進行中，但現在我們已做好準備，利用這項投資向前邁進。

Business and industry can evolve and shift quite rapidly, and we have to stay ahead of these trends. We have a unique and superior technology platform in our DC power systems, and the challenge for us is to focus and execute on the right strategy. Our core telecom business remains a robust opportunity for Polar, and I'm very excited to be moving ahead in military, residential and commercial markets.

商業和工業可以快速發展和轉變，我們必須走在這些趨勢的前面。我們的直流電源系統擁有獨特、卓越的技術平台，我們面臨的挑戰是專注於正確的策略並執行。我們的核心電信業務對 Polar 來說仍然是一個強勁的機會，我非常高興能夠在軍事、住宅和商業市場中取得進展。

Now I'll turn the call over to Raj who will address our strategy for entering these residential, commercial markets. Raj?

現在我將電話轉給 Raj，他將介紹我們進入這些住宅和商業市場的策略。拉吉？

Thank you, Arthur, and good afternoon, everyone. As Arthur mentioned, I'd like to now review our strategy and target for new market development. We recently completed a strategic review of our international sales effort, and I want to spend a few minutes talking about what we found and the adjustments we are making to improve over closing rates.

謝謝你，亞瑟，大家下午好。正如亞瑟所提到的，我現在想回顧一下我們新市場開發的策略和目標。我們最近完成了對國際銷售工作的策略性審查，我想花幾分鐘談談我們發現的情況以及我們為提高成交率所做的調整。

As we've outlined before, the international telecom market is a very large and diverse sector, both in terms of geographies and potential customers. Our analysis had shown that the sales effort was spread across too many prospects. And as an organization, we were not focusing our resources on the best opportunities with the highest return potential. This will change as part of my new role, analyzing and reviewing each of our customer prospects to determine where the best opportunities sit and align with sales, engineering and corporate around those targets. We believe this will help improve our close rates as well as better manage our expenses.

正如我們之前所概述的，國際電信市場是一個非常龐大且多樣化的領域，無論從地理或潛在客戶的角度來看。我們的分析表明，銷售工作分散在太多潛在客戶身上。作為一個組織，我們並沒有將資源集中在具有最高回報潛力的最佳機會上。隨著我新角色的實施，這種情況將會改變，我將分析和審查我們的每個潛在客戶，以確定最佳機會所在，並圍繞這些目標與銷售、工程和公司進行協調。我們相信這將有助於提高我們的成交率並更好地管理我們的開支。

Next, I want to expand our strategy to more aggressively target the last-mile carriers. We believe many of the last-mile carriers are good candidates for our power systems as their operations are decompartmentalized, giving greater visibility on the equipment factors driving their OpEx and CapEx cost, which gives Polar a distinct advantage over traditional technologies. We've already landed a $1.3 million contract that we press released recently, and we're in discussion with other carriers. In fact, approximately 12 of the last-mile carriers have flowed down contracts from one of our larger customers and the FirstNet programs, giving us a compelling market.

接下來，我想擴大我們的策略，更積極地瞄準最後一哩路的承運商。我們相信，許多最後一哩的承運商都是我們電力系統的良好候選人，因為他們的營運是非隔間化的，可以更清楚地了解推動其營運支出和資本支出成本的設備因素，這使 Polar 比傳統技術具有明顯的優勢。我們已經達成了一份價值 130 萬美元的合同，並在最近發布的新聞中公佈了這一消息，同時我們正在與其他運營商進行洽談。事實上，大約有 12 家最後一哩運營商已經從我們的一個較大客戶和 FirstNet 計劃中簽下了合同，這為我們提供了一個引人注目的市場。

As also Arthur mentioned earlier, we believe there's an attractive market for us in the residential and the small offices and off-grid operations. Extreme weather, man-made and natural disasters are highlighting the benefits and need for distributed energy generation. Take California and the recent wildfires and the associated grid disruptions as an example, these extreme power outages highlight the need for independent sources of electric power that won't be affected by these outages. It's important to understand that the majority of solar PV installations, which are extensive and installed in California, failed to supply power when the grid goes down, and we see exactly the same situation repeated throughout the country with fires, floods, tornadoes, hurricanes and extreme temperatures.

正如亞瑟之前提到的，我們相信住宅、小型辦公室和離網營運對我們來說是一個有吸引力的市場。極端天氣、人為和自然災害凸顯了分散式能源發電的好處和必要性。以加州最近的山林火災和相關的電網中斷為例，這些極端停電事件凸顯了對不受停電影響的獨立電力來源的需求。重要的是要了解，大多數在加州廣泛安裝的太陽能光伏裝置在電網斷電時都無法供電，我們看到同樣的情況在全國各地重複出現，包括火災、洪水、龍捲風、颶風和極端氣溫。

I want to emphasize that we're not going to target every residential home and small business, and we have no intentions of competing in the low-end backup power market. We're focused on a specific customer profile that is optimal for us. Let me give you an example.

我想強調的是，我們不會針對每個住宅和小型企業，我們也沒有打算在低端備用電源市場競爭。我們專注於對我們來說最佳的特定客戶資料。讓我給你舉個例子。

In California alone, there are 4.88 million homes with solar. There are 570,000 electric vehicles. There are 1.18 million homes with pools. These are the type of customers that we believe will fit us or fit the profile of our product. From January 1, 2020, solar panels are mandatory in all new homes built in California. We expect others to follow this initiative, too. So as we could see, the market is quite substantial. It is important to understand that we'll pursue this market in a different direction than the incumbent residential and commercial generator suppliers.

光是在加州，就有 488 萬戶家庭使用太陽能。電動車57萬輛。有118萬戶家庭擁有游泳池。我們相信這類客戶適合我們或適合我們的產品。自 2020 年 1 月 1 日起，加州所有新建住宅都必須安裝太陽能板。我們希望其他國家也能效法這項措施。所以我們可以看到，這個市場相當龐大。重要的是要明白，我們將以與現有的住宅和商業發電機供應商不同的方向進入這個市場。

So the first question that we ask is, why buy a load reliability light-duty generator that's designed to back up your home but is running at very limited number of hours each year using natural gas or propane? A superior solution and a much better option would be to purchase our prime power generator or micro-cogeneration unit. This system is designed to operate 24/7 with very little maintenance compared to those generators available in the market today. During peak hours, our prime power system can power your air conditioner, charge your car, heat your pool or spa, along with space heating and hot water, which creates a very high level of efficiency. Also one of the most important properties with our prime power systems is that you have the same conveniences during a power outage. Given the low cost of propane or natural gas, our solution is very economically competitive with grid power and the added benefits of CHP with reliability and power under nearly all conditions. We'll be launching this program soon, and we'll be working towards building the necessary sales and service infrastructure.

因此，我們要問的第一個問題是，為什麼要購買設計用於家庭備用電源但每年使用天然氣或丙烷且運行時間非常有限的負載可靠性輕型發電機？一個更好的解決方案和更好的選擇是購買我們的主要發電機或微型熱電聯產裝置。與目前市場上的發電機相比，該系統設計為全天候運行，幾乎不需要維護。在尖峰時段，我們的主要電力系統可以為您的空調供電、為您的汽車充電、為您的游泳池或水療中心加熱、以及提供空間加熱和熱水，從而實現非常高的效率。我們的主要電力系統最重要的特性之一是，即使在停電期間您仍能享受相同的便利。鑑於丙烷或天然氣的成本較低，我們的解決方案在經濟上與電網電力非常具有競爭力，並且具有熱電聯產的額外優勢，在幾乎所有條件下都能保證可靠性和電力。我們將很快啟動該計劃，並致力於建立必要的銷售和服務基礎設施。

Now I turn the call over to Luis, our CFO, for the financial summary. Luis, over to you.

現在我將電話轉給我們的財務長路易斯，請他提供財務摘要。路易斯，交給你了。

Thank you, Raj. Now I will review the financial performance for the quarter and the 9 months ended September 30, 2019. Revenues for the third quarter 2019 were $6.9 million, representing a $1.9 million increase or 30% compared to $5.0 million last year. Backlog as of the end of the third quarter was $3.0 million compared to $11.5 million at the end of the same quarter last year. The decrease in sales backlog was primarily attributable to reduced lead times and lower sales of DC systems to Tier 1 telecom customers. As we discussed in previous quarter, we are experiencing short-term volatility with our Tier 1 telecom customers as they are shifting budgets for the second half of this year to favor 5G rollout relative to backup power. As expected, this negativity impacted our bookings for the third quarter. We believe these short-term shifts will remain -- and we remain -- I'm sorry, let me repeat that, we believe these short-term shifts -- we believe that these are short-term shifts, and we remain confident in our customers' forecast for 2020.

謝謝你，拉傑。現在我將回顧截至2019年9月30日的本季和9個月的財務表現。2019 年第三季的營收為 690 萬美元，較去年的 500 萬美元增加 190 萬美元，增幅為 30%。截至第三季末的積壓訂單為 300 萬美元，而去年同期末的積壓訂單為 1,150 萬美元。銷售積壓訂單的減少主要歸因於交貨時間減少以及面向一級電信客戶的 DC 系統銷售下降。正如我們在上一季所討論的那樣，我們的一級電信客戶正在經歷短期波動，因為他們正在調整今年下半年的預算，以更傾向於推出 5G 而不是備用電源。正如預期的那樣，這種負面因素影響了我們第三季的預訂量。我們相信這些短期轉變將會持續下去——我們仍然——抱歉，讓我重複一遍，我們相信這些短期轉變——我們相信這些都是短期轉變，我們仍然對客戶對 2020 年的預測充滿信心。

Growth profit for the year stood at $2.2 million, representing $0.7 million or 46% increase as compared to last year's $1.5 million. Gross margins during the third quarter increased to $32.2 million as compared to 30.2 -- I'm sorry, let me repeat that, gross margins during the third quarter of increased to 32.2% as compared to 30.2% during the same period last year as a result of improved production efficiency, coupled with reduction in engine prices acquired during the fourth quarter of 2018. Operating expenses decreased to $2.2 million in Q3 2019 from $2.3 million in Q3 2018. Operating expenses for the 9 months ended September 30, 2019, were $6.9 million as compared to $5.9 million for the same period in 2018. Operating expenses remain constant as we continue our strategy to promote our DC power in international markets.

全年成長利潤為 220 萬美元，較去年的 150 萬美元增加 70 萬美元（即 46%）。第三季的毛利率從 3,020 萬美元增至 3,220 萬美元——抱歉，讓我重複一遍，第三季的毛利率從去年同期的 30.2% 增至 32.2%，這得益於生產效率的提高，加上 2018 年第四季引擎價格的下降。2019 年第三季的營運費用從 2018 年第三季的 230 萬美元下降至 220 萬美元。截至 2019 年 9 月 30 日的 9 個月的營業費用為 690 萬美元，而 2018 年同期為 590 萬美元。由於我們持續推行在國際市場推廣直流電的策略，營運費用保持不變。

Net income for Q3 2019 totaled $48,000 or $0.00 per basic and diluted share compared to net loss of $0.7 million or $0.07 per basic and diluted -- negative $0.07 per basic and diluted share in Q3 2018. Net income increased for the 9 months ended September 30, 2019, to $0.7 million or $0.07 per basic and diluted share compared to net loss of $0.8 million or negative $0.08 per basic and diluted shares during the same period in 2018. The increase in net income is attributable to higher revenues, resulting in higher contribution margins and improved production efficiencies during the third quarter when compared to the same period last year.

2019 年第三季的淨收入總計 48,000 美元或每股基本和稀釋利潤 0.00 美元，而 2018 年第三季的淨虧損為 70 萬美元或每股基本和稀釋利潤 0.07 美元——每股基本和稀釋利潤均為負 0.07 美元。截至 2019 年 9 月 30 日的 9 個月，淨收入增加至 70 萬美元，即每股基本和稀釋收益 0.07 美元，而 2018 年同期的淨虧損為 80 萬美元，即每股基本和稀釋收益負 0.08 美元。淨收入的成長歸因於收入的增加，從而導致第三季度與去年同期相比貢獻利潤率更高以及生產效率提高。

Current assets at September 30, 2019, grew to $24.3 million compared to $23 million at December 31, 2018. Inventory on September 30, 2019, grew to $14.1 million compared to $8.5 million at December 31, 2018. Cash at September 30, 2019, totaled $3.6 million as compared to $5.6 million on December 31, 2018. As of September 30, 2019, we had working capital of $21.3 million.

截至 2019 年 9 月 30 日的流動資產從 2018 年 12 月 31 日的 2,300 萬美元成長至 2,430 萬美元。2019 年 9 月 30 日的庫存從 2018 年 12 月 31 日的 850 萬美元成長至 1,410 萬美元。截至 2019 年 9 月 30 日的現金總額為 360 萬美元，而 2018 年 12 月 31 日為 560 萬美元。截至 2019 年 9 月 30 日，我們的營運資金為 2,130 萬美元。

Now I will turn the call back to Arthur.

現在我將把電話轉回給亞瑟。

Thank you, Luis. And I'd like to -- and thank you, Raj and Shawn. In line with our key strategic initiatives with additional production management that we have hired and closely worked with during the last period, we believe that now we have a better bandwidth to be able to manage purchase orders and work-in-progress inventory more effectively than what we've done in the past. We believe our new team will be able to work efficiently to make sure that expedited delivery times are unaffected -- or expected delivery times are unaffected. Also, our operations managers continue to work on optimizing inventory demand to facilitate cash flow in both the near term and long term and throughout this period with expected volatility in product sales.

謝謝你，路易斯。我想——感謝 Raj 和 Shawn。根據我們的關鍵策略舉措，我們在上一期間聘用了額外的生產管理人員並與他們密切合作，我們相信，現在我們擁有比過去更好的頻寬，能夠更有效地管理採購訂單和在製品庫存。我們相信我們的新團隊將能夠有效地工作，確保加急交貨時間不受影響——或預計交貨時間不受影響。此外，我們的營運經理繼續致力於優化庫存需求，以促進短期和長期的現金流，並在此期間應對產品銷售的預期波動。

I'd like to thank our shareholders for their continued support, and I'm looking forward to speaking with you all again next quarter. Now I'd like to open this up to call -- questions. Operator?

我要感謝我們的股東一直以來的支持，並期待下季再次與大家交談。現在我想開始提問。操作員？

(Operator Instructions) We'll take our first question from Craig Irwin with Roth Capital Partners.

（操作員指示）我們將回答 Roth Capital Partners 的 Craig Irwin 提出的第一個問題。

So Arthur, you were just talking about the balance sheet and the inventory issues. In the quarter, you had a $2 million increase in inventory, and that was more than 100% of either your negative $1.7 million in free cash or negative $1.8 million change in total cash. So the importance of that, I guess, is magnified. Can you maybe walk us through what the items are that you're building an inventory? Is this finished goods that possibly didn't make it out the door to customers during the quarter? Is this components you've accumulated for better pricing? And would you expect to liquidate this in a material way in the next quarter or 2? What do you see as an acceptable inventory level for Polar?

那麼亞瑟，你剛才談到資產負債表和庫存問題。本季度，您的庫存增加了 200 萬美元，這超過了您的自由現金負 170 萬美元或總現金負 180 萬美元變化的 100%。因此，我認為這一點的重要性就被放大了。您能否向我們介紹一下您正在建立庫存的物品是什麼？這些成品是否可能在本季未能交付給客戶？這是為了獲得更優惠的價格而累積的組件嗎？您是否預計在下個季度或兩個季度內以實質性的方式清算這一金額？您認為 Polar 可以接受的庫存水準是多少？

Well, first of all, as time goes on, I see our inventory levels increasing, along with our market increasing. But we need inventory to reach a certain dollar amount to secure our ability to deliver on time. The other answer -- and I'll give this over to Luis who will give you more detail, but the other answer is yes, we have a large stock of engines and components and work in progress.

首先，隨著時間的推移，我看到我們的庫存水準和市場規模都在成長。但我們需要庫存達到一定的金額才能確保我們能夠準時交貨。另一個答案——我將把這個問題交給路易斯，他會給你更多細節，但另一個答案是肯定的，我們有大量的發動機和零件庫存，並且正在進行中。

Yes. Just to add a little bit to that, we are trying to increase the -- speed up the finished goods inventory so that we can have it in stock to speed up delivery times.

是的。補充一點，我們正在嘗試增加——加快成品庫存，以便我們能夠有庫存，加快交貨時間。

Okay. And can you maybe clarify for us, is any of this inventory specific for any individual customers and programs where you expect to be a supplier over the next year? Or is most of it sellable to pretty much any customer?

好的。您能否為我們澄清一下，這些庫存是否有針對特定個人客戶或項目的，您預計明年會成為這些客戶的供應商？或者說大部分產品都可以賣給任何顧客嗎？

Mostly sellable to any customer, and that's one of the strategies that we're putting in place with this diversification. The big guys, the big Tier 1s want us to be able to deliver in 2 weeks to 8 weeks' period, which means we have to have a product. But their orders, as we've seen, are not consistent. So we want to be able to supply those to the other telcos and to the other commercial and industrial accounts. A good portion of our inventory is now stacked up with Toyota engines waiting for launch, too. Raj, do you want to add something to that?

大部分產品都可以賣給任何客戶，這是我們透過多樣化實施的策略之一。大公司、大型一級供應商希望我們能夠在 2 週到 8 週的時間內交貨，這意味著我們必須有產品。但正如我們所見，他們的命令並不一致。因此我們希望能夠向其他電信公司以及其他商業和工業客戶提供這些服務。我們的庫存中現在也堆積了很大一部分等待上市的豐田引擎。Raj，你還有什麼要補充的嗎？

No. No. I mean that is exactly the same point, that's exclusive to Polar, right?

不。不。我的意思是，這是完全相同的觀點，這是 Polar 獨有的，對嗎？

Yes, exclusive to Polar.

是的，Polar 獨有。

Great. Great. So then one of the opportunities on the telecom side that we've been maybe a little bit optimistic about is the 5G rollout and the changes to the format of the infrastructure that are going to be used in cell sites across the country. Can you maybe update us on what products you have for 5G, whether or not you're bidding on any specific programs where we could see large related orders? Have you delivered cast or prototype units to customers to potentially secure these orders related to 5G?

偉大的。偉大的。因此，我們在電信方面可能有點樂觀的其中一個機會是 5G 的推出以及將在全國各地基地台使用的基礎設施格式的改變。您能否向我們介紹一下你們為 5G 提供的產品，以及您是否正在競標任何我們可以看到大量相關訂單的特定項目？您是否已向客戶交付鑄件或原型單元，以獲得與 5G 相關的這些訂單？

Okay. One of the things that we did to put ourselves on a strategically better situation is that we're working with the manufacturers of the 5G equipment directly in Europe. And that's something being spearheaded by Adam Szczepanek out of Poland. I've made visits and met with some of the manufacturers of 5G equipment over there. So we're getting kind of a heads-up. In terms of like the wireless carriers, they really don't know how much power they need. We -- I mean a few years ago, we started at 10 kilowatts. We went to 15 kilowatts. And now we're going to 20 kilowatts. And some are calling for 25 to 30 kilowatts. But on the other hand, some of the radio equipment manufacturers are suggesting that those upper limits -- those upper sizes may not be required. That's one thing.

好的。為了讓自己處於更好的戰略地位，我們所採取的措施之一是直接與歐洲的 5G 設備製造商合作。這是波蘭的亞當‧甚切帕內克 (Adam Szczepanek) 率先開展的活動。我去那裡參觀並會見了一些5G設備製造商。因此我們得到了某種程度的警告。就無線營運商而言，他們確實不知道他們需要多少電力。我們—我的意思是幾年前，我們從 10 千瓦開始。我們達到了15千瓦。現在我們要達到20千瓦。有些人要求25至30千瓦。但另一方面，一些無線電設備製造商認為這些上限——這些上限尺寸可能不需要。這是一回事。

The second thing is with the 5G rollout, there'll be a lot of microcells going out there. And the current plan for the microcells by most of the carriers is not to back those up, but that will conflict with the markets that they're trying to service, such as autonomous vehicles or self-driving vehicles, hospitals, generally, the IoT of things. So we are working with some backup technologies that don't involve batteries, fuel cells or generators that we can back these microcell sites up for about somewhere in the neighborhood of 5 seconds to 5 minutes, depends on the area. And that way, that covers 90% to 98% of the power outages are just momentary glitches. All that said, did I answer your question?

第二件事是，隨著 5G 的推出，將會出現大量的微蜂巢。目前，大多數營運商的微蜂窩計劃並不支援這些，但這將與他們試圖服務的市場發生衝突，例如自動駕駛汽車、醫院以及一般的物聯網。因此，我們正在研究一些不涉及電池、燃料電池或發電機的備用技術，我們可以將這些微蜂窩站點的備用時間設定為大約 5 秒到 5 分鐘，具體取決於區域。這樣，90% 到 98% 的停電都只是暫時故障。話雖如此，我回答了你的問題了嗎？

No, that broadly captures it. So one of the markets that you were maybe more vocal about in the past has been the marine market where I know your personal interests, having had some business there in the past and hobby in that market. Can you maybe update us on whether or not you're seeing a potential opportunity for Polar at the moment in the marine market? Is this something where your ability to really satisfy technical or highly demanding technical applications for small-run production, it looks like it could be an advantage over the next few quarters.

不，大體上就是這樣。因此，您過去可能比較關注的市場之一是船舶市場，我知道您個人對該市場感興趣，您過去曾在該市場做過一些生意，並且對這個市場很有愛好。您能否告訴我們，您是否認為 Polar 目前在船舶市場上有潛在機會？這是否表明您真正有能力滿足小批量生產的技術或高要求技術應用？

Well, on the marine, as you pointed out, the marine market is a hobby market, not my hobby. Though I enjoy boats. But it's a very difficult market because it's dominated by home hobbyists running businesses. We have put marine on a low priority as it has always been. Marine does take a lot of customer support because what's happening is that you're putting a generator in with batteries and with electric motor on some of these hybrid sailing vessels, and then you're putting someone to run the equipment that has a basic understanding of electricity, and it goes no further than that. We'll continue to support the market, but there's larger markets out there that can give stockholders a better return on their investments.

嗯，關於海洋，正如你所指出的，海洋市場是一個愛好市場，而不是我的愛好。雖然我喜歡船。但這是一個非常困難的市場，因為它主要由家庭愛好者經營的企業所主導。我們一如既往地將海洋放在較低的優先地位。船舶確實需要大量的客戶支持，因為實際情況是，你在一些混合動力帆船上安裝帶電池和電動機的發電機，然後你讓一個對電有基本了解的人來操作設備，僅此而已。我們將繼續支持市場，但還有更大的市場可以為股東帶來更好的投資回報。

Okay. And then the military market in the past has also been an opportunity that we've talked quite a bit about. So you did have some really interesting business with Oshkosh in the last 18 months. Is that potentially something that could lead to follow-on orders? Are there other OEMs like Oshkosh that we can pursue with the same products? Is there the need to develop additional products to pursue the military opportunity?

好的。過去的軍事市場也是我們談論過的機會。所以在過去的 18 個月裡，您確實與 Oshkosh 進行了一些非常有趣的業務往來。這是否有可能帶來後續訂單？是否有其他像 Oshkosh 一樣的 OEM 可以供我們生產相同的產品？是否需要開發其他產品來獲取軍事機會？

Well, with -- the military opportunity is whatever product in our sector, in our area of power generation, power conversion and stuff and cooling systems, no matter what you have, it doesn't meet their requirements. They want something custom. And that does place a lot of engineering pressure -- or a lot of pressure on your engineering resource to deliver that. But the nice thing about it is the military will pay your R&D, whereas, the telecom and other markets won't pay your R&D. We've been able to be benefited by a lot of the military testing that they perform on our product, allowing us to continuously improve the product.

嗯，軍事機會在於我們領域中的任何產品，在發電、電力轉換和冷卻系統領域，無論你擁有什麼，都無法滿足他們的要求。他們想要一些客製化的東西。這確實給工程帶來很大的壓力，或是給你的工程資源帶來很大的壓力。但它的好處是軍方將支付你的研發費用，而電信和其他市場不會支付你的研發費用。他們對我們的產品進行的大量軍事測試使我們受益匪淺，使我們能夠不斷改進產品。

Yes, there are a number of programs out there. But one thing about the military program -- military market sales is that on the big projects, you work on a project today, and that means that you can look 4 and 5 years from now on getting an order, so it's a long-term situation. So we look forward to the military in terms of one-off short production runs that could eventually lead to longer production runs, but the biggest benefit is the R&D dollars and the testing support and stuff like that. Now identifying products for the military, those would be in the larger generator sets or going upwards of around 200 kilowatts, which we do want to go after.

是的，有很多這樣的項目。但關於軍事項目——軍事市場銷售的一個問題是，在大項目中，你今天從事一個項目，這意味著你可以展望4到5年後的訂單，所以這是一個長期的情況。因此，我們期待軍方能夠進行一次性短時間的生產，最終實現更長的生產，但最大的好處是研發資金、測試支援等。現在確定用於軍事的產品，那些將是更大的發電機組或功率高達 200 千瓦左右的產品，這是我們想要追求的。

That sounds good. That sounds really good. So the last question, if I may, it's kind of a difficult question to ask, but many of the shareholders will have it on their minds. A year ago, we were kind of optimistic that around half of this year's sales would come from international markets. It's obvious that this expectation is just not in your stock. But can you maybe describe for us what's worked for you in the international market, maybe what some of the issues might be for the budget or the potential award of projects there? And should we still keep our eye open for growth on the international side over the next several quarters?

聽起來很好。聽起來確實不錯。所以最後一個問題，如果可以的話，這是一個很難問的問題，但很多股東都會考慮這個問題。一年前，我們樂觀地認為今年約一半的銷售額將來自國際市場。顯然，你根本不符合這個期望。但是您能否為我們描述一下您在國際市場上採取的措施，以及在預算或潛在項目中可能遇到的一些問題？未來幾季我們是否還應該關注國際方面的成長？

Yes. Unfortunately, our predictions of when some of these contracts were to come to fruition was greatly off. But as anyone knows, on the sales cycle, you can't predict when a customer is going to give you an order until after you received it. And overseas is maybe a little bit more difficult in terms of prediction as opposed to local, domestic markets. I would still say, as I say each quarter, we're pretty close to some good contracts. But what we actually have learned is that, again, as I mentioned on my last call, our field salesmen need more support from Polar headquarters in terms of materials, presentation, training, demonstrations and stuff like that, which is something that we're beginning to expand our support on.

是的。不幸的是，我們對其中一些合約何時實現的預測有很大偏差。但眾所周知，在銷售週期中，您無法預測客戶何時會向您下訂單，除非您收到訂單後。與本地和國內市場相比，海外市場的預測可能更困難一些。我仍然會說，正如我每個季度所說的那樣，我們非常接近一些好的合約。但我們實際上了解到的是，正如我在上次電話中提到的那樣，我們的現場銷售人員需要 Polar 總部在材料、演示、培訓、演示等方面提供更多支持，而這正是我們開始擴大支持範圍的方面。

We -- for example, last month, I was in Spain working with a major telco there who's present in about 35 countries, and we're presenting the Toyota unit operating on natural gas and propane or LPG, which is a combination of propane and butane. And we were told, for example, like in Chile, the government has outlawed or has severely restricted the small diesel generator sets. So the telco has to remove all those generator sets. So it is a perfect opportunity for us to replace it with the Toyota-based LPG engines driving our alternators. We're seeing more and more regulations driving customers' power direction.

例如，上個月，我在西班牙與一家業務遍及約 35 個國家的大型電信公司合作，我們展示了使用天然氣和丙烷或液化石油氣（丙烷和丁烷的混合物）運營的豐田裝置。例如，我們被告知，在智利，政府已經禁止或嚴格限制小型柴油發電機組。因此電信公司必須拆除所有發電機組。因此，這對我們來說是一個絕佳的機會，可以用基於豐田的 LPG 引擎來驅動我們的交流發電機，從而取代它。我們看到越來越多的法規推動客戶的電力方向。

Excellent. Well, congratulations on what I would call actually a good execution in this difficult environment. We look forward to continued progress.

出色的。好吧，恭喜你，可以說在如此困難的環境下，你確實表現得很好。我們期待繼續取得進展。

Thank you, Craig.

謝謝你，克雷格。

And we will take our next question from [Chris Dechowsky], a private investor.

我們的下一個問題來自私人投資者 [Chris Dechowsky]。

So I just had a question about the current ongoing quarter. I'm a little bit worried because the reported backlog is a little low. And you spend the beginning of the year, the beginning of the calendar year, upgrading your factories up to -- I believe, you mentioned that your plan was up to $15 million per quarter, and now we have $3 million backlog. So are you getting short-term orders to keep your factories at least running somehow? Are we going to see kind of like bigger costs from underutilization this current quarter?

我只是對當前季度有一個疑問。我有點擔心，因為報告的積壓量有點低。你們在年初，也就是日曆年初就將工廠升級到——我相信，你提到你們的計劃是每季度高達 1500 萬美元，而現在我們有 300 萬美元的積壓訂單。那麼，您是否收到了短期訂單以至少以某種方式維持工廠的運作？本季，我們是否會看到利用不足而導致的更大成本？

Okay. We are building to -- we are building for inventory, and we are still shipping generator sets, and we are looking forward to receiving orders from a more diversified customer base. Raj, do you want to add to that?

好的。我們正在建立庫存，我們仍在運送發電機組，我們期待從更多樣化的客戶群中接收訂單。Raj，你想補充一下嗎？

Just to add to that one, Chris. We've got some follow-on orders from Tier 1s in the past few weeks. And we've got a rolling 12-month forecast from the Tier 1 accounts, so we are building a product to the forecast. And also, the $15 million number that we have given you is basically when both factories run in full steam, a shift, 1.5 shifts. So obviously, it is not the number to basically hit in order to keep the factory live and going. We've demonstrated this quarter that even with less than $7 million of revenue, without making any major changes in factory expansion, in fact, actually, we've increased our production management, we're still able to post a positive cash flow. So I would say that we are not sure yet in terms of giving you guidance of whether we will be at a loss in this quarter or not, but we're definitely building to forecast and definitely building against orders that we have received for the past few weeks.

我只是想補充一點，克里斯。過去幾週我們收到了來自 Tier 1 的一些後續訂單。我們從一級帳戶獲得了滾動的 12 個月預測，因此我們正在根據該預測建立產品。而且，我們給您的 1500 萬美元這個數字基本上是在兩家工廠全速運轉的情況下，一個班次，1.5 個班次。很顯然，這並不是維持工廠正常運作所必須達到的數字。本季我們已經證明，即使收入不到 700 萬美元，在沒有對工廠擴建進行任何重大改變的情況下，事實上，我們已經加強了生產管理，我們仍然能夠實現正現金流。因此，我想說的是，我們還不確定能否向您提供本季是否會出現虧損的指引，但我們肯定會根據預測進行調整，並且肯定會根據過去幾週收到的訂單進行調整。

So if I understand correctly, you do have some orders after the quarter end, but you're also building to forecast from the telecoms that have not ordered yet. They're just forecasts of what they might -- they'll probably need, and you're putting the generator inventory for that purpose. Is that correct?

所以，如果我理解正確的話，您在季度末之後確實有一些訂單，但您也在根據尚未訂購的電信公司的情況進行預測。他們只是對他們可能需要的東西進行預測，然後你為此目的準備發電機庫存。那正確嗎？

That is correct.

正確。

That is correct, and that is something that most manufacturers do is manufacture on anticipation or speculation. The key is to have enough diversification in your customers so that if your targeted customer doesn't take the product, you have at least 10 others to fill in that requirement.

這是正確的，大多數製造商都是基於預期或猜測進行製造的。關鍵是要讓你的客戶足夠多樣化，這樣如果你的目標客戶不接受該產品，你至少還有 10 個其他客戶可以滿足這項要求。

With the same product.

使用相同的產品。

For the same product.

對於同一產品。

And can you tell us whether those forecasts have proved accurate in the past?

您能告訴我們這些預測在過去是否準確嗎？

They've usually been in line with the forecast. They have been sometimes even exceeding their forecast. And as Arthur said here once again, we don't want to be working with 1 customer's forecast. We want to have enough companies that we're working within the road, I expect, if one slows down, we've got 3 more to pick up and take those products.

它們通常都與預測一致。有時他們的業績甚至超乎預期。正如亞瑟在這裡再次所說的那樣，我們不想只根據一個客戶的預測來工作。我們希望有足夠多的公司與我們在這條路上合作，我預計，如果一家公司放慢了速度，我們還有三家公司可以接手並接收這些產品。

But that is the way the business is done. You have to be able to produce and deliver when the customer needs it. So that does involve some risk, but you mitigate the risk by increasing your customer base.

但這就是做生意的方式。您必須能夠在客戶需要時生產和交付。所以這確實涉及一些風險，但您可以透過增加客戶群來降低風險。

Okay. I understand. And in previous calls, you talked about how you almost welcome kind of the follow-up orders in Tier 1 accounts in order to satisfy the Tier 2 customers that you said were not willing to wait that much for orders. And you told us about this Tier 2 market that's there just -- they would just require kind of like the ability for you to execute orders on the shorter term. And now that you don't have this large backlog, is that happening? Are you getting those Tier 2 orders?

好的。我明白。在先前的電話會議中，您談到您幾乎歡迎一級客戶的後續訂單，以滿足二級客戶的需求，您說二級客戶不願意等待訂單太久。您向我們介紹了二線市場，他們只是需要您在短期內執行訂單的能力。現在您沒有這麼多積壓訂單，這是怎麼回事？您收到那些二級訂單了嗎？

Well, we announced a few weeks back, we got 1 Tier 2 order, or what we like to call last mile, of about $1.5 million. That was from 1 customer, for example. And we are going to the other companies. But it's not like turning on a light switch where as you turn on a light switch, they come out. It will take some time to book these orders. Now one other thing about forecast, the forecasts generally, from our experience, have turned out to be pretty accurate. The only difficulty is when. That's where it has proven not to be too accurate, when. The amounts are good, but the delivery dates are always changing from our customers.

嗯，我們幾週前宣布，我們獲得了 1 個二級訂單，或者我們稱之為最後一英里，價值約為 150 萬美元。例如，這是來自 1 位顧客的。我們還會去其他公司。但這不像打開電燈開關，當你打開電燈開關時，它們就會出現。預訂這些訂單需要一些時間。關於預測還有一件事，根據我們的經驗，預測通常都是相當準確的。唯一的困難在於時間。事實證明，它並不太準確。數量不錯，但交貨日期總是根據客戶的要求而變化。

It's lumpy between the quarters.

各季度之間波動較大。

I see. And they expect a short turnaround for everything. Is that because they don't want to have accounts payable balances or so on?

我懂了。他們期望所有事情都能在短時間內完成。這是因為他們不想有應付帳款餘額等等嗎？

These are large companies with a lot of bureaucracy. And so I don't think it's so much -- it's intentional, outside the fact that they don't want to warehouse the generators. What they like to do is have the generators ordered and drop-ship to the installation site, that's their goal, and in that way, minimizes handling. So they're working on just-in-time.

這些都是大公司，官僚主義嚴重。因此，我認為這並不是有意為之，除了他們不想將發電機存放在倉庫中之外。他們喜歡做的是訂購發電機然後直接運送到安裝現場，這是他們的目標，這樣可以最大限度地減少搬運。因此他們正在進行即時生產。

Okay. And if I may ask a couple of questions about your new product. First of all, from somebody in California where we've got to fear those power blackouts, could you tell me about your residential, commercial product? I know right now, usually, that market is served by Generac. But as you mentioned, all their products kind of have very short run time until the breakdown, and so they're not really kind of a replacement, they're just strictly for emergencies. So can you tell us what kind of prices you're targeting? Is it going to be how much works? Is it going to be then the Generac generators? Is it going to be much smaller? Is it going to be -- I mean you should -- are you going to have advantages with less vibration and less noise and so on?

好的。我可以問幾個關於你們新產品的問題嗎？首先，身為加州擔心停電的人，您能否向我們介紹您的家用和商用產品？我現在知道，通常該市場由 Generac 提供服務。但正如您所說，他們的所有產品在發生故障之前的運行時間都很短，因此它們並不是真正的替代品，而只是嚴格用於緊急情況。那你能告訴我們你的目標價是多少嗎？這需要多少工作？那麼它會是 Generac 發電機嗎？它會變得更小嗎？是不是會這樣——我的意思是你應該——是不是會具有更少振動、更少噪音等優勢？

Well, first of all, the Generac packages that I've seen recently advertised, that run on natural gas and propane, are small 900 cc to 1,000 -- at a 100,000 cc of displacement, operating at 3,600 RPM. So that's pretty loud, pretty hard on the engine, and they are squeezing as much power out of the engine to try to get a peak rating of 20 kilowatts. We're taking a similar size, 900 cc engine, and running in the speed range of 1,600 to 2,400 RPM. And at those speeds, we're really quiet. But our engines are also very heavy duty. They're cast iron blocks as opposed to aluminum blocks. We're mounting them in soundproof enclosures as opposed to a lightweight aluminum shield with a plastic top on it.

嗯，首先，我最近看到的廣告中，使用天然氣和丙烷的 Generac 套件體積較小，為 900 cc 到 1,000 — — 排氣量為 100,000 cc，運轉速度為 3,600 RPM。所以聲音會很大，對引擎的負擔很大，而他們正在從引擎中榨取盡可能多的動力，試圖獲得 20 千瓦的峰值額定值。我們採用類似尺寸的 900 cc 發動機，運行速度範圍為 1,600 至 2,400 RPM。在這樣的速度下，我們真的很安靜。但我們的引擎也非常重型。它們是鑄鐵塊，而不是鋁塊。我們將它們安裝在隔音罩內，而不是安裝在頂部帶有塑膠的輕質鋁屏蔽內。

These engines are coming out of applications that do run them -- these Toyota engines are run 24 hours a day, 7 days a week in Japan, powering their air conditioning equipment that operates off the natural gas grid as opposed to our air conditioners that operate off the electric utility grid. And this is another market we see for cooling solutions is to provide air conditioning off natural gas as opposed to electric grid.

這些發動機來自運行它們的應用程式——這些豐田發動機在日本每週 7 天、每天 24 小時運行，為使用天然氣管網運行的空調設備提供動力，而我們的空調則使用電力網運行。我們看到的另一個冷卻解決方案市場是利用天然氣而不是電網來提供空調。

We see this equipment going into the backyard, being able to heat the home, heat the house, charge the car. The whole idea is that you'll have 3 sources of energy: one is utility, the other one is your solar and the third is your natural gas. So if you got problems with any one of them, you can switch around and get your best operating cost, your best reliability and, more importantly, get electric power when you need it. I mean I've seen solutions coming from the state of California about using fuel cells or using battery storage. That won't work, too much energy demand for a battery storage or way too much CapEx and OpEx costs for a fuel cell. And I can't imagine that the stuff in your freezer just kind of lasts too well with your power grid going on and off. I can see people getting sick with tainted food eaten after it's been defrosted improperly. Anyway, did I answer your questions?

我們看到這種設備走進後院，能夠為家裡供暖、為房屋供暖、為汽車充電。整個想法是，你將擁有 3 種能源：一個是公用事業，另一個是太陽能，第三個是天然氣。因此，如果其中任何一個出現問題，您可以切換過來並獲得最佳營運成本、最佳可靠性，更重要的是，在需要時獲得電力。我的意思是我已經看到了加州提出的關於使用燃料電池或使用電池儲存的解決方案。這樣做不行，因為電池儲存的能量需求太高，或是燃料電池的資本支出和營運支出成本太高。我無法想像，當電網時斷時續時，你冰箱裡的東西還能保存得很好。我看到有人因為吃了未經適當解凍的受污染食物而生病。無論如何，我回答了你的問題了嗎？

Yes, mostly. But can you give me any kind of just general information about the price in comparison to, let's say, the Powerwall or the Generac systems?

是的，大部分都是。但是您能否給我一些關於其價格的一般信息，與 Powerwall 或 Generac 系統進行比較？

It's too early to give you sharp pricing, but let me give you something general. One of the ideas about using our product is to minimize the battery. Your batteries are very expensive storage source and very -- in terms of both of the capital purchase and the operational cost because -- and anywhere between 4 to 8 years when you have to replace that battery, again, you're hit with a heavy cost. The generators that we have, we're expecting at least a 7-year life on those, as much as 14 years, 15 years' life, and that's running them heavy, that's running them hard. But what we'd be looking at is a price of between, let's say, $18,000 to, let's say, $35,000.

現在給您確切的價格還為時過早，但讓我給您一些整體資訊。使用我們的產品的一個理念是盡量減少電池的使用。您的電池是非常昂貴的儲存來源，而且非常——就資本購買和營運成本而言——並且當您必須在 4 到 8 年間更換該電池時，您將面臨沉重的成本打擊。我們預計發電機的使用壽命至少為 7 年，最多為 14 年、15 年，而且它們運作負荷很大，非常吃力。但我們要考慮的價格是在 18,000 美元到 35,000 美元之間。

Now here is the difference between, let's say, what you're buying from Polar is that if you got a swimming pool, you're not spending money on your swimming pool heater or the heater -- or the furnace for your house. So you're combining appliances into 1 appliance, 1 appliance that's going to use less fuel energy, 1 appliance that's going to be lower on your monthly bill. So it's a complex comparison of costs because, again, we're providing more than just a generator set that backs up your home for a few hours a day, we're talking about a generator set that can run your home 24 hours a day. Did that kind of answer your question?

現在，這裡有一個區別，假設您從 Polar 購買的產品是這樣的，如果您有一個游泳池，您就不需要花錢購買游泳池加熱器或加熱器——或者您家中的暖氣爐。因此，您要將這些電器組合成 1 個電器，1 個將消耗更少燃料能源的電器，1 個將降低您每月帳單費用的電器。所以這是一個複雜的成本比較，因為我們提供的不僅僅是每天為您的家庭提供幾個小時的發電機組，我們談論的是可以全天 24 小時為您的家庭供電的發電機組。這回答了你的問題嗎？

Yes. So what you're saying is that your product will also scavenge the heat from the engine or will you use the electricity to heat the pool and the house?

是的。所以您的意思是，您的產品也能吸收引擎產生的熱量，還是會使用電力加熱泳池和房屋？

No, it's scavenge heat off the engine. Our goal is to utilize 80% to 90% of the fuel's energy, which is a combination of electricity and heat.

不，它是從引擎中除去熱量。我們的目標是利用80%到90%的燃料能量，即電能和熱能的結合。

Okay. I see. And -- all right. And about the micro sites for telecoms for 5G, there's -- the way I read about them, they're talking about just putting them on light poles and so on. So what product are you thinking about there? And how would you -- how are you -- how is your company kind of positioned to provide such a product because when I think of your company, I think you're kind of experts in the electric motors and alternators and such, and I'm not sure those products would even have moving parts.

好的。我懂了。而且——好吧。關於 5G 電信微型站點，據我所知，他們討論的是將其放置在燈桿上等。那您考慮的是什麼產品呢？那麼您——您如何——您的公司如何定位來提供這樣的產品，因為當我想到您的公司時，我認為您是電動機和交流發電機方面的專家，但我不確定這些產品是否具有活動部件。

Okay. As I mentioned earlier in the presentation that we agree that you can't -- you don't want to use even batteries on those units. You don't even want to put a small battery in those units because some of these carriers are going to have 100,000, 200,000, 300,000 of these cell sites, these microcell sites out there, 1 carrier. And if he has to go around to all those sites every year or every 3 years replacing a battery, that's awfully expensive. And there's no way a generator is going to work and no way a fuel cell is going to work. All those are maintenance items. We're looking at capacitance-type storage systems in the area of super capacitors. And yes, we're working on the electronics to be able to make the most of energy -- to be able to extract most of the energy out of that capacitor. Now in terms to what we've done in the past, we put power systems on aircraft. We put power systems underwater. We put cooling systems into space. We've done a lot more than just build generators and motors.

好的。正如我在演示中早些時候提到的那樣，我們一致認為您不能——您甚至不想在這些設備上使用電池。你甚至不想在這些裝置中放置一塊小電池，因為其中一些運營商將擁有 100,000、200,000、300,000 個這樣的蜂窩站點、這些微蜂窩站點，而只有 1 個運營商。如果他每年或每三年都要去這些站點更換電池，那成本就太高了。發電機根本無法運作，燃料電池根本無法運作。這些都是維護項目。我們正在研究超級電容器領域的電容型儲存系統。是的，我們正在研究電子設備以便能夠最大限度地利用能源——能夠從電容器中提取大部分能源。就我們過去所做的事情而言，我們在飛機上安裝了動力系統。我們將電力系統置於水下。我們將冷卻系統放入太空。我們所做的遠不止於製造發電機和電動機。

So you believe you have internal engineering advantage building super capacitor systems?

那麼，您認為您在建立超級電容器系統方面擁有內部工程優勢嗎？

Let's just say that there's guys out there in other companies that can build wonderful capacitors. We don't need to duplicate that technology. But it's how you package that, how you grab those super capacitors and then squeeze every coulomb of energy out of it to run a microcell. That's our experience. You don't have to have -- yes.

我們只能說其他公司有人能製造出優質的電容器。我們不需要重複該技術。但這關乎你如何封裝它，如何抓住這些超級電容器，然後從中擠出每一庫侖的能量來運行微電池。這就是我們的經驗。你不一定要有——是的。

I was going to say you're right because capacitors as opposed to batteries aren't constant voltage devices, so the electronics will be much more complex.

我想說你是對的，因為與電池相比，電容器不是恆壓設備，所以電子設備會複雜得多。

We'll take your next question from Jeff Kobylarz with Diamond Bridge Capital.

我們將由 Diamond Bridge Capital 的 Jeff Kobylarz 來回答您的下一個問題。

Just curious about the last-mile carrier where you got the over $1 million order that you announced earlier, can you say how long of a selling process that took to get that order?

我只是好奇，您之前宣布的最後一英里承運商獲得了超過 100 萬美元的訂單，您能說一下獲得該訂單的銷售過程花了多長時間嗎？

I think it started back in...

我認為它開始於...

Summer of 2018.

2018 年夏天。

Summer of what is it, was it 1998 or just, Raj, before?

那是什麼時候的夏天，是 1998 年還是之前，Raj？

Yes. We've been working with this client for a while, just in small volumes. But yes, this is the first time that we basically have received an order of this magnitude from them. On this particular contract, the sales cycle was around 4 to 5 months. We've been working since the summer on this one.

是的。我們與這位客戶已經合作了一段時間，但合作數量不大。但確實，這基本上是我們第一次從他們那裡接到如此規模的訂單。對於這個特定的合同，銷售週期大約為 4 到 5 個月。我們從夏天就開始致力於此事。

So they've been using, running our generators out in the field for maybe as long as 10 years.

所以他們已經在現場使用、運作我們的發電機大概有10年了。

Sure.

當然。

And they can see how the generators that we delivered to them hold up against other products.

他們可以看到我們交付給他們的發電機與其他產品相比表現如何。

And may I also add that this client also has business in 4 other countries in the Caribbean. And so now we are talking to them about what we can offer and how we can help improve those sites there in that region.

我還要補充一點，該客戶還在加勒比海地區的其他 4 個國家開展業務。所以現在我們正在與他們討論我們可以提供什麼以及如何幫助改善該地區的這些遺址。

Okay. So they bought from you? And who did they not buy from, if you could say just in general?

好的。所以他們從你這裡買了？那麼，如果可以一般性地說的話，他們沒有從誰那裡購買商品呢？

An overseas company that also provides DC systems.

一家同樣提供直流系統的海外公司。

Okay. All right. And as far as the potential with this customer, is there much more than this -- you did mention the Caribbean, but is there much more behind some of these...

好的。好的。至於這位客戶的潛力，是否還有更多呢——您確實提到了加勒比地區，但這些背後是否還有更多......

Right. They've got more sites. So yes, they've got more sites than the ones that we received the purchase order for generators. So there are innovative ways of backing up the site, it doesn't have to be generators only, like Arthur was discussing with Chris earlier. So we're talking to them about all those options now.

正確的。他們有更多的網站。所以是的，他們擁有的站點比我們收到發電機採購訂單的站點還要多。因此，有創新的方法來備份網站，不一定要只使用發電機，就像 Arthur 之前與 Chris 討論的那樣。所以我們現在正在和他們討論所有這些選擇。

Right. Okay. And you said that there are 12 other last-mile carriers that you're pitching now.

正確的。好的。您說過現在還有 12 家其他最後一哩運輸公司正在與您合作。

Major.

主要的。

Major last-mile carriers as part of this particular program, but...

主要的最後一英里承運商是該特定計劃的一部分，但是...

As part of the FirstNet program.

作為 FirstNet 計劃的一部分。

Yes, part of the FirstNet program. But other than that, I mean we have serviced close -- anywhere between 50 to 100 different last-mile carriers over the past 5 years -- 5 to 10 years.

是的，這是 FirstNet 計劃的一部分。但除此之外，我的意思是，在過去 5 年到 10 年的時間裡，我們已經為近 50 到 100 家不同的最後一英里承運商提供了服務。

10 to 20 years.

10到20年。

Right. Okay. Do you think -- is there going to be any beta test by these customers, these 12 that you're pitching? Or will they require other kinds of...

正確的。好的。您認為－您所推銷的這 12 位客戶會進行任何 Beta 測試嗎？或者他們需要其他類型的...

Generally, not with these last mile -- generally, not so much with these last-mile domestic carriers. At least, we've been domestic since, let's say, 1994. So we do have enough local sites we can point our finger at. And we do have -- and they do see our product very frequently when they look at Verizon or AT&T or T-Mobile sites.

一般來說，這些最後一哩的國內航空公司並非如此。至少，從 1994 年起我們就已經在國內生活了。因此我們確實有足夠的本地站點可供參考。我們確實有——當他們瀏覽 Verizon、AT&T 或 T-Mobile 網站時，他們確實經常看到我們的產品。

So they've got good endorsement from them.

因此他們得到了他們的良好認可。

Yes. It's not like selling to a company in Thailand or a company in Botswana.

是的。這與向泰國公司或波札那公司銷售產品不同。

Okay. All right. And then on the last call 3 months ago, you said that you weren't getting orders from the Tier 1 because you didn't have a fast-enough fulfillment time, and you reduced the fulfillment time, but now you're saying that they're not ordering because they're pushing their capital spend into next year. Is that the gist of it? Is that right?

好的。好的。然後在三個月前的最後一次電話會議中，你說你沒有得到來自 Tier 1 的訂單，因為你的履行時間不夠快，所以你縮短了履行時間，但現在你說他們沒有訂購，因為他們將資本支出推遲到明年。這就是它的要點嗎？是嗎？

Correct. They've got issues where they're moving money around for the 5G, for their mergers and acquisitions. I mean there are some big mergers and acquisitions recently that does tend to wreak havoc on things like generator sets.

正確的。他們在為 5G 和併購轉移資金方面遇到了問題。我的意思是最近有一些大型的併購交易確實會對發電機組之類的東西造成嚴重破壞。

And one of the clients also mentioned that their construction schedules -- they're behind on their construction schedules. So they don't want to end up with a ton of generators in their warehouse. As Arthur said, this is a just-in-time logistics kind of a play. And so that's the reason that we have to work with forecast, so that we're not -- they're not getting delayed. Their programs are not getting delayed because of supply chain issues downstream.

其中一位客戶也提到，他們的施工進度落後了。所以他們不希望倉庫裡堆滿一大堆發電機。正如亞瑟所說，這是一種即時物流類型的遊戲。這就是我們必須進行預測的原因，這樣我們才不會——它們就不會被延誤。他們的項目不會因為下游的供應鏈問題而延遲。

Okay. So when do you think you will hear from these Tier 1 carriers about their 2020 need?

好的。那麼您認為何時會從這些一級運營商那裡聽到有關他們 2020 年需求的消息？

We're been already hearing about that in terms of forecast, but obviously that has to be converted to purchase orders. Only then will we be able to say that. Now it's also noteworthy to mention that our large competitors also, in their most recent earnings calls, also mentioned about the slowdown from the Tier 1 telecom carriers. So it's basically an industry effect, not just -- we are not immune to it.

我們已經聽說過有關預測的事情，但顯然這必須轉化為採購訂單。只有那時我們才能這麼說。值得一提的是，我們的大型競爭對手在最近的財報電話會議上也提到了一級電信業者的成長放緩。所以這基本上是一種行業效應，而不僅僅是——我們無法免受其影響。

And again, those will be arguments for diversification.

再次，這些都是多樣化的理由。

Sure. That makes sense, right? And about this LPG generator, anything to say about your plans to submit the engine for EPA certification or where that stands?

當然。這很有道理，對吧？關於這台 LPG 發電機，您能透露一下提交 EPA 認證的計劃嗎，或者目前情況如何？

Okay. Where it stands is that we passed all the emission testing required by the EPA. They have our data, and our form is filled out. And right now, we're waiting the issue of the certificate.

好的。目前我們已通過了美國環保署要求的所有排放測試。他們有我們的數據，而且我們的表格也已填好。現在，我們正在等待證書的頒發。

Okay. Do you know how long that normally takes, the EPA, to give you that?

好的。你知道環保署通常要花多久時間才能給你這個答案嗎？

I was trying to think of something funny to say, but no, we don't know how long. But it could be here next week, it could take 60 days.

我試著想說些有趣的話，但不行，我們不知道要說多久。但它可能下週到達，可能需要 60 天。

And we've been working on this process for almost a year now.

我們致力於這項進程已經將近一年了。

But most of that was with, first of all, tuning the engine to make the requirements and then submitting it for testing and then the -- generating the test reports and the paperwork.

但其中大部分是先調整引擎以滿足要求，然後提交測試，然後產生測試報告和文書工作。

But the actual testing process happened in the past 2 to 3 months.

但實際測試過程發生在過去2到3個月。

It happened last month.

這件事發生在上個月。

Yes.

是的。

Okay. All right. And the efforts with this generator in Australia, any comments at all about where that stands?

好的。好的。您對於這台發電機在澳洲的使用情況有何評論？

Yes. I've already met with the 2 leading companies, Allgas and Origin. And as they explained to me, they've got about 40,000 off-grid subscribers. So right now we are working very diligently to come up with a sales tool, a presentation tool. When you look at something like a super-duper water heater that's in a mailer from the Southern California Gas Company or PG&E or whatever, the gas companies don't put that together, the vendors of the oil -- I mean of the furnace or water heater did, and they spend a lot of time putting that program together for sales, maintenance, installation, all that other stuff. So these are the details we're working on now.

是的。我已經與兩家領先的公司 Allgas 和 Origin 會面。他們向我解釋道，他們擁有大約 40,000 名離網用戶。所以現在我們正在努力推出一種銷售工具和簡報工具。當您看到南加州天然氣公司或太平洋天然氣電力公司 (PG&E) 或其他公司在郵件中提供的超級熱水器之類的東西時，您會發現，天然氣公司並不會把它組裝起來，而是石油（我的意思是爐子或熱水器的供應商）的供應商才這麼做，而且他們花費大量時間將這個程序組裝起來，用於銷售、維護、安裝以及所有其他事情。這些就是我們現在正在處理的細節。

But if you keep in mind that there is a glut of LPG fuel, propane, butane fuels out on the market and, at the same time, you have regulatory agencies wanting to do away with diesel, but these guys are having some issues with trying to "sell" product. So what we're saying is that it's perfect for a $1 billion company to be able to say, look, we can double or triple our sales if we go after power generation using fuel and presenting this solution to our customer base.

但如果你記住，市場上液化石油氣燃料、丙烷、丁烷燃料供過於求，同時，監管機構想要廢除柴油，但這些人在試圖「銷售」產品時遇到了一些問題。因此，我們要說的是，對於一家價值 10 億美元的公司來說，如果我們利用燃料發電並向我們的客戶群提供這個解決方案，我們的銷售額就可以翻倍或翻三倍，這真是太好了。

Now this couldn't happen before because your natural gas and LP generator sets were essentially converted lawnmower engines, riding lawnmower engines or weed-whacking engines or whatever. These are lightweight-duty engines converted over to natural gas or propane, limited hours, 200 days, serviced every 8 days or so. Now we're bringing a serious generator onto the market that gives them a year's maintenance. So in other words, you're changing your oil at every 8,000 to 9,000 hours. In generators, that's virtually maintenance-free. Matter of fact, if you look at a fuel cell, a lot of fuel cells, you have to change the membrane at 8,000 hours. We're going to be changing the fuel -- I mean the oil. And the oil is a lot cheaper than changing a fuel cell membrane. Now Raj has a comment regarding...

現在這種情況是不可能發生的，因為您的天然氣和液化石油氣發電機組本質上是改裝的割草機引擎、騎乘式割草機引擎或除草機引擎等等。這些是改裝為天然氣或丙烷的輕型發動機，使用時間有限，200 天，每 8 天左右維修一次。現在我們向市場推出了一款可以提供一年維修服務的發電機。換句話說，您每 8,000 至 9,000 小時就要更換一次機油。對於發電機來說，這幾乎是免維護的。事實上，如果你觀察燃料電池，很多燃料電池，你必須在 8,000 小時後更換薄膜。我們將要改變燃料——我指的是石油。而且石油比更換燃料電池膜便宜很多。現在 Raj 對... 有一則評論。

Yes, Jeff, there's one more market. I mean we're pursuing a few market opportunities. One of them is a huge agricultural market in the state of California. All of them are -- obviously most of -- many of them are grid connected, the water pumps, the variable frequency drives, they're mostly -- pretty much all of them run on DC power. And they're having some major issues with the recent fires and the PG&E shutdowns. Their crop is getting destroyed closer to harvest season. So we see a lot of -- a big market there for a good quality prime power generator that pays with solar because they want to be energy independent.

是的，傑夫，還有一個市場。我的意思是我們正在尋求一些市場機會。其中之一是加州的大型農產品市場。它們全部 — — 顯然大多數 — — 其中許多都與電網相連，水泵、變頻驅動器，它們大多數 — — 幾乎所有都採用直流電運行。他們面臨著最近火災和 PG&E 停電帶來的一些重大問題。接近收穫季節，他們的農作物被毀壞了。因此，我們看到，那裡對使用太陽能發電的優質主要發電機有著很大的市場，因為他們希望實現能源獨立。

Now just one other comment on that is that since we're a technology-based company, we are a high-tech company, we're looking at even other solutions for the agricultural people. For example, on farms, they use fertilizer. And one of the fertilizers, the generator can run off of it. That's your ammonia fertilizer. And they say that the ammonia fertilizers are cheaper than the LPG, cheaper than diesel, which means that the farmers can actually generate electricity cheaper than they can buy it off the grid if they use their fertilizer. And a lot of farms will have huge amounts of this ammonia fertilizer on their farms stored there, ready to use. And the nice thing about the ammonia fertilizers is that it's 0 emissions. It's as clean as a hydrogen fuel cell.

現在對此的另一條評論是，由於我們是一家技術型公司，一家高科技公司，我們正在為農業人民尋找其他解決方案。例如，在農場，他們使用肥料。其中一種肥料可使發電機運轉。這就是你的氨肥料。他們說，氨肥比液化石油氣和柴油便宜，這意味著，如果農民使用氨肥，他們實際上可以以比從電網購買電費更低的價格發電。許多農場都會儲存大量這種氨肥，隨時可用。氨肥的優點在於其零排放。它和氫燃料電池一樣清潔。

Okay. All right. That's encouraging. Just with all these very good prospects on the horizon, hopefully next year, do you think you'll be able to run at cash flow kind of breakeven until some of these bigger -- some of these new ventures kick in? My last question.

好的。好的。這令人鼓舞。鑑於眼前所有這些非常好的前景，希望明年，您是否認為您的現金流能夠達到收支平衡，直到一些更大的新企業開始營運？我的最後一個問題。

Luis?

路易斯？

Yes. When our sales go back to what they were in the previous 2 quarters, we'd definitely be positive. So we will not be -- we'll be better than breakeven.

是的。當我們的銷售額恢復到前兩個季度的水平時，我們肯定會感到樂觀。因此我們不會－我們的業績將比損益平衡更好。

Okay. But until then, do you think $5 million -- your $5 million revenue -- sorry, $7 million revenue this quarter, you're currently -- you're a little bit EBITDA positive.

好的。但在此之前，您是否認為 500 萬美元——您的 500 萬美元收入——抱歉，本季度 700 萬美元的收入，您目前——您的 EBITDA 有點正值。

We don't expect to be in this position for too many quarters. I mean we are expecting -- we are working with our Tier 1 carriers. There's a lot of communication. It's just a matter of time of orders coming back in. Now going back to last year, we kind of ran through the same scenario. Fortunately, we had just acquired a second Tier 1 carrier -- or a third Tier 1 carrier that started with very aggressive purchasing in July of 2018. While the other Tier 1 carrier slowed down, this Tier 1 carrier was doing significant purchasing. So the slowdown was not really visible at that time, but it's pretty much the same thing that's happening this year. Unfortunately, all our Tier 1 carriers slowed down at the same time, but we believe they're all going to pick up. They usually start picking up definitely towards the end of the year, getting ready for the next year.

我們預計不會在這個位置上待太久。我的意思是我們期待——我們正在與我們的一級運營商合作。有很多交流。訂單恢復只是時間問題。現在回顧去年，我們也經歷了同樣的情況。幸運的是，我們剛剛收購了第二家一級營運商——或者說第三家一級營運商，該營運商在 2018 年 7 月開始大力採購。當其他一級業者放緩時，這家一級業者正在進行大量採購。因此，當時經濟放緩的現象並不明顯，但今年的情況基本上相同。不幸的是，我們所有的一級運營商同時放慢了速度，但我們相信他們都會回升。他們通常會在年底開始回升，為明年做好準備。

Keep in mind that we have been in business since 1979, and we have -- we learned how to that manage our cash flows, so we don't get ourselves too deep into trouble.

請記住，我們自 1979 年開始營業，我們已經學會如何管理現金流，這樣我們就不會陷入太深的困境。

(Operator Instructions) We'll hear now from [Eric Rescue], a private investor.

(操作員指示)現在我們來聽取私人投資者 [Eric Rescue] 的發言。

I think a decent amount of the things that were on my mind were answered previously on earlier questions. But one area that I want to get a little better understand of is sort of if you can give us a little more why you think you have clarity on orders that will be coming from Tier 1 over this next year. I know you said that the timing historically has always kind of been unknown, but last quarter, you told us that you expected orders to kind of come back either late Q3, early Q4. Obviously, that hasn't happened. And I think a lot of your investors still have shell-shock from when the Verizon orders dropped off a couple of years ago. And at that time, I believe you were also saying you expected orders to come back, and they never really did. So is there anything that you can kind of give us that's more concrete, more clarity, more certainty that all we have to do is wait out a couple of more months, and we're not looking at a permanent drop-off from your Tier 1s.

我認為我心中的許多問題已經在先前的問題中得到解答了。但我希望更了解的一個領域是，您是否可以向我們進一步說明，為什麼您認為您清楚了解明年來自一級市場的訂單。我知道您說過，從歷史上看，時間安排一直是未知的，但上個季度，您告訴我們，預計訂單將在第三季末或第四季初恢復。顯然，這並沒有發生。我認為許多投資者仍對 Verizon 訂單幾年前大幅下降感到震驚。我相信您當時也說過，您預計訂單會回來，但事實並非如此。那麼您能否給我們更具體、更清晰、更確定的信息，讓我們知道我們所要做的就是再等待幾個月，而且我們不會期待您的一級成績永久性下降。

Okay. Now the Verizon situation was a surprise to us, too. We still, to date, are just going by theories as to what happened then. But when you are supplying so much product to these 3 or 4 major Tier 1 suppliers, what we have learned is that it's too narrow of a focus, there's not enough customer diversification. Things come up. One company decides to acquire another and, in the process, wants to, what you might say, save all their cash, short other budgets. I mean even they can't predict when they can even consummate a merger because now it's regulated by government. So what I'm trying to say is that the solution ahead isn't trying to develop a better crystal ball, the solution ahead is to diversify your customer base, not being so dependent. We were very dependent on that 1 supplier, Verizon. And then -- yes, one customer, Verizon. And when that happened, we had to go out and then dig up some more customers which, again, was part of our IPO strategy, we're raising capital so we can diversify our product and our customer base. And that's what we've been doing fairly successful. It was a pretty short period of time before we brought on a number of other Tier 1 suppliers to replace Verizon, and our sales did get back up there.

好的。現在 Verizon 的情況也讓我們感到驚訝。到目前為止，我們仍然只是根據理論來理解當時發生的事情。但當你向這三、四家主要的一級供應商供應如此多的產品時，我們發現，你的焦點太過狹窄，客戶多樣化程度不夠。事情發生了。一家公司決定收購另一家公司，在這個過程中，你可能會說，他們想省下所有的現金，減少其他預算。我的意思是，甚至他們也無法預測何時能夠完成合併，因為現在它受到政府監管。所以我想說的是，未來的解決方案不是試圖開發一個更好的水晶球，而是讓你的客戶群多樣化，而不是那麼依賴。我們非常依賴那個供應商——Verizon。然後 - 是的，有一位客戶，Verizon。當這種情況發生時，我們必須走出去，挖掘更多的客戶，這也是我們 IPO 策略的一部分，我們正在籌集資金，以便能夠實現產品和客戶群的多樣化。這正是我們一直做得相當成功的事。在我們引進許多其他一級供應商來取代 Verizon 之前很短的時間內，我們的銷售額確實回升了。

Well, that's definitely all good on diversifying the customer base. But at least in the short run, you still have -- and I guess what I'm trying to say is that, assuming that their orders are not coming in, in maybe a few weeks and they don't come in for another 6 months, how long can you maintain this cash neutral, cash positive -- cash flow positive situation without them?

嗯，這對多樣化客戶群肯定是有好處的。但至少在短期內，你仍然有——我想我要說的是，假設他們的訂單在幾週內沒有到達，甚至在 6 個月內都沒有到達，沒有他們，你能將這種現金中性、現金為正——現金流為正的狀況維持多久？

How long? Well, let's just say considering the number of decades we've been in business, I would say we've got the experiences to be able to weather all storms. And in the past, even before we went public, yes, we did have storms that took our -- that would happen to us where the sales would will go down and we would have to recover. But here's the thing though, Verizons, AT&Ts and T-Mobiles and stuff like that, those guys are not the largest guys out there buying generator sets. And we are -- again, it's been a much longer process than anticipated, but we are moving forward with larger telcos that have a greater need for product. And we're close. But how close, I cannot predict the date. And I am involved directly at some of those negotiations with the customers, and they've just got so much bureaucracy in place that they need to move to place the orders with.

多久？好吧，考慮到我們從事該行業幾十年的時間，我想說我們已經擁有了能夠渡過一切風暴的經驗。在過去，甚至在我們上市之前，我們確實遇到過一些風暴，這些風暴會導致銷售額下降，我們必須恢復。但問題是，Verizons、AT&T 和 T-Mobile 等公司並不是購買發電機組的最大公司。而且我們—再說一次，這是一個比預期要長得多的過程，但我們正在與對產品有更大需求的大型電信公司合作。我們很接近了。但我無法預測具體日期。我直接參與了與客戶的一些談判，但他們卻遇到了太多的官僚主義問題，需要採取行動才能下訂單。

Is there anything that you could give us a little more on explaining why you feel you're close them right now? Even if they're still anxious...

您能否進一步解釋為什麼您現在感覺和他們很親近？即使他們仍然感到焦慮…

Well, I should say let's look at Chile. 2005, the government told them -- told the telco there, which is one of the 7 largest telcos in the world, not just Chile, their parent corporation, that they can no longer be using diesel fuel on their generators. But they relaxed their requirements because their supply of natural gas and propane was being disrupted. It wasn't available. So now this year, the government is telling the wireless companies that they have to get their generators off their sites and replace with a cleaner fuel. Now I'm confident that I'm going to land that account with the Toyota product. The date on which I get that contract, if I was a younger person, I would say about -- it would take about 2 months. I'm an older person now, and I can say that it would be a mistake to advertise and promote that potential sales lead because you don't know when it's going to happen. But the key is to be able to get enough of those so that you are collecting orders from some of them that give you contracts sooner as opposed to later.

好吧，我應該說讓我們看看智利。2005 年，政府告訴他們——告訴那裡的電信公司，這家電信公司是世界七大電信公司之一，而不僅僅是智利的母公司，他們不能再在發電機上使用柴油。但由於天然氣和丙烷供應中斷，他們放寬了要求。它不可用。所以今年，政府要求無線電通訊公司必須將發電機撤出現場，並用更乾淨的燃料取代。現在我有信心憑藉豐田產品贏得這個客戶。如果我比較年輕的話，那麼拿到合約的日期大概需要 2 個月左右。我現在已經老了，我可以說，宣傳和推廣潛在的銷售線索是一個錯誤，因為你不知道它什麼時候會發生。但關鍵是能夠獲得足夠的客戶，以便您可以從他們那裡收集訂單，從而儘早獲得合約。

All right. Well, that's good to hear. Switching topics a little bit. Last quarter, you'd mentioned a number of your new product, the timetable for them coming out has been delayed. I know one of those anyway. But the residential product, you said, had to do with EPA approval. But what's the status of all those products you referred to last quarter?

好的。嗯，很高興聽到這個消息。稍微轉換一下話題。上個季度，您提到了許多新產品，但它們的上市時間表已經被推遲。無論如何我知道其中一個。但是您說住宅產品必須獲得 EPA 批准。但是上個季度您提到的所有產品的狀態如何？

We're delayed about 30 days to 60 days on those. When you're developing new products, you have your target dates and you have your delays. But we will be shipping these products very shortly. And most notably is a project that involves the U.S. Air Force in Nevada. So we will be shipping that product. And when we launch that product, we would be advertising and promoting it. That will be an energy story.

我們大約延遲了30天到60天。當你開發新產品時，你有目標日期，也有延遲。但我們很快就會出貨這些產品。其中最值得注意的是涉及內華達州美國空軍的計畫。因此我們將運送該產品。當我們推出該產品時，我們會對其進行廣告宣傳和推廣。這將是一個能源故事。

You had also mentioned last call that you had a new software application that you saw as being key to sales at the time. And I believe you launched that over the last quarter. Do you have anything, an update with regards to that?

您上次還提到，您有一個新的軟體應用程序，您認為它對當時的銷售至關重要。我相信你們已經在上個季度推出了這個功能。您有與此相關的最新消息嗎？

We're still in beta on that. We're still beta on that. The product is developed, and it's in beta, and it's going through some debugging now.

我們對此仍處於測試階段。我們對此仍處於測試階段。該產品已開發完成，目前處於測試階段，正在進行一些調試。

Okay. And then, one last question. I do applaud that you are reviewing your strategy over time and making some adjustments to the plan. But just as we're -- we've been going past these last few years, and particularly on the international front, things have been really slow and have not worked out the way we all hoped obviously. But at what point or what conditions would you have to see, to conclude and then say, hey, we don't need to just make minor tweaks to our strategy, we need to make a really big fundamental change like working through distribution partners, shutting down certain parts, effort. And maybe on an extreme, what conditions would you look to even consider trying to sell the company?

好的。還有最後一個問題。我確實讚賞你隨著時間的推移審查你的策略並對計劃做出一些調整。但正如我們——過去幾年我們一直經歷的那樣，特別是在國際方面，事情進展非常緩慢，顯然沒有像我們所希望的那樣發展。但是，你必須在什麼時候或什麼條件下才能得出結論，然後說，嘿，我們不需要對我們的戰略做一些微小的調整，我們需要做出一個真正重大的根本性的改變，比如通過分銷合作夥伴開展工作，關閉某些部分等。也許在極端情況下，您會考慮什麼條件才嘗試出售公司？

Okay. What you're saying is at what point are we going to have our fire sale.

好的。你的意思是說我們什麼時候才會進行賤賣。

Well, I mean at what point do you really say that, hey, our business strategy needs to be fundamentally changed up to the point that we need to look for a buyer? Just how long do we keep going before we turn it to a real problem?

那麼，我的意思是，在什麼時候你會真正說，嘿，我們的業務策略需要從根本上改變，以至於我們需要尋找買家？我們到底還要堅持多久才會將其變成真正的問題？

Okay. I'm not sure how to answer that question. It's kind of like a lot of gloom and doom there. You're assuming that we're running the company into the ground and therefore, we should sell it for...

好的。我不知道該如何回答這個問題。那裡看起來充滿了悲觀和厄運。你認為我們正在把公司經營得陷入困境，因此，我們應該以...的價格出售它。

Well, I'm not assuming you're running it to the ground, apologies for not being clear. Just in a worst-case scenario, let's say, orders, just they never come, never come, never come, eventually a real fundamental shift to the business strategy would happen. So what conditions would you need to see to come to...

好吧，我並不是假設你會把它搞砸，抱歉我說得不清楚。只是在最壞的情況下，比如說，訂單永遠不會來，永遠不會來，最終商業策略會發生真正的根本轉變。那麼您需要滿足什麼條件才能到達…

If you say that the orders never come, never come and at what point do we sell the company, basically, you don't -- if the orders don't come, you don't have anything to sell.

如果你說訂單永遠不會來，永遠都不會來，那麼我們什麼時候才能賣掉公司呢？

I suppose. I guess we're operating...

我想。我想我們正在操作...

You are also talking about a scenario that really hasn't happened with me throughout my lifetime. We design and build equipment. If, for some reason, next year, that the world's powers that be decide that they don't want to have any more fits and engines, I will still sell product.

您談論的情景在我一生中實際上從未發生過。我們設計並製造設備。如果明年由於某種原因，世界當權者決定不再需要任何引擎和配件，我仍然會銷售產品。

All right. Well, I apologize for not being clear on that, just trying to assess tailwinds.

好的。好吧，我很抱歉沒有清楚地說明這一點，我只是想評估一下順風。

Exactly. Now let me put it this way, is that my interests are in line with the investors. And if a deal comes across the table that's in the best interest of the investors, I will take a very close and hard look at it. Now there's one word I'd like to leave you with, and that's patience. If you look at what we've been able to do in this renewable energy sector and in this power section and being able to not lose millions of dollars each quarter like you have on so many other clean tech company, you will see that we do have the talent and we do have the product to move forward, I mean can you point to any companies in our sector that is doing incredibly well with so little dollar investment.

確切地。現在讓我這樣說吧，我的利益與投資人的利益是一致的。如果達成的交易符合投資者的最佳利益，我會非常仔細地研究它。現在我想留給你們一個詞，那就是耐心。如果您看看我們在再生能源領域和電力領域所取得的成就，以及我們能夠避免像其他許多清潔技術公司那樣每季度損失數百萬美元，您就會發現我們確實擁有人才，也擁有可以向前發展的產品，我的意思是，您能否指出我們領域中哪家公司在投入如此少的資金的情況下表現非常出色？

Thank you. There are no further questions in the queue at this time. That does conclude today's conference. We thank all of you for your participation. You may now disconnect.

謝謝。目前隊列中沒有其他問題。今天的會議到此結束。我們感謝大家的參與。您現在可以斷開連線。

Thanks.

謝謝。