Research Frontiers Inc (REFR) 2020 Q1 法說會逐字稿

Good afternoon, ladies and gentlemen. Welcome to Research Frontiers' investor conference call to discuss the first quarter of 2020 results and recent developments. (Operator Instructions)

This conference is being recorded today. A replay of this conference will be available starting later today in the Investors section of Research Frontiers' website at www.smartglass.com and will be available for replay for the next 90 days.

Please note that some of the comments made today may contain forward-looking information. The words expect, anticipate, plans, forecast and similar expressions are intended to identify forward-looking statements. Statements that are not historical facts are forward-looking statements that are made pursuant to the safe harbor provisions that are part of the Securities Litigation Reform Act of 1995. These statements reflect the company's current beliefs, and a number of important factors could cause actual results for future periods to differ materially from those expressed. Significant factors that could cause results to differ from those anticipated are described in our filings with the SEC.

Research Frontiers undertakes no obligation to update or revise these forward-looking statements to reflect new events or uncertainties. The company will be answering many of the questions that were e-mailed to it prior to this conference call, either in the presentation or as part of the Q&A session at the end. In some cases, the company has responded directly to e-mail questions prior to the call or will do so afterwards in order to answer more questions of general interest to shareholders on this call. (Operator Instructions) Also, we ask that you keep your questions brief in the interest of time. I'll now turn the call over to Joe Harary, President and Chief Executive Officer of Research Frontiers. Please go ahead, sir.

Thank you, Erica, and good afternoon, everyone, and thanks for being here. Joining me today is Seth Van Voorhees, our CFO. In our last investor conference call, we discussed our results of operations and developments for the last fiscal year. We will leave that conference call available for a while on our website, so you can refer to it. You will see that last year, we had many accomplishments that position Research Frontiers for strong growth.

Based upon the questions we received from investors prior to this call, the main 2 areas that I will be discussing today is: one, any expected impact of the COVID-19 pandemic on our business; and two, Hyundai's recent investment in the SPD-SmartGlass industry.

COVID-19 has affected everyone. From an economic standpoint, Research Frontiers will be fine, but it did take a very personal toll. 3 weeks ago, today, my wife lost her father quite unexpectedly to COVID-19. My report to you is dedicated to him today. My dear father-in-law was in good health and actively working. I will miss him and his love and wise counsel, and I urge everyone to please be careful and stay healthy and safe. Your health and safety is of utmost importance.

As a company, we have taken steps to protect the health and well-being of our employees, our licensees and their customers. We are all restricting travel, practicing social distancing and working remotely whenever possible. We have also taken steps to protect our business. We have always run our company very conservatively from a fiscal standpoint. We have been debt-free since we went public in 1986. We have raised money prior to needing it, so that we would have the resources available to us when needed. The wisdom of this approach started by our founder, Bob Saxe, has become particularly evident today. We have at least 34 months' worth of cash and lower expenses going forward. We also received COVID-19 funding in April.

When we backed out nonrecurring charges and noncash accounting effects, 2019 represented the fifth consecutive year that expenses at Research Frontiers have decreased and the sixth consecutive year of lower operating losses for our company compared to the prior year. As I mentioned on our last conference call in March, we are on track to continue this trend of lower expenses and lower losses this year. In fact, we achieved this. Total expenses plus warrant market adjustment line items declined by $225,000 in the first quarter of 2020 compared to the first quarter of 2019. Compared to the first quarter of 2019, the company's net loss for the first quarter of 2020 was reduced by $179,303 to $624,594 or $0.02 per common share for the first quarter ending March 31, 2020, as compared to a net loss of $803,897 or $0.03 per common share for the first quarter of 2019.

In addition to looking at comparisons with the same quarter 1 year ago, I'd also like to look at comparisons with the prior quarter, so we can get a better idea of trend lines and performance. There were also dramatic improvements in our results of operations in the first quarter of this year as compared to the prior quarter, the fourth quarter of 2019. The expenses were lower this quarter by about $600,000 compared to the fourth quarter, and our net loss this quarter was almost $664,000 lower than last quarter. Lowering expenses keeps us flexible, frees up resources to be deployed more effectively where needed and also helps us become profitable faster. It increases our effectiveness as a business. We continue to spend the fraction of what others do in the smart window industry and Research Frontiers has better results of operations.

As many of you know, some of our competitors, such as View, have announced significant layoffs. I'm not sure that these are related to COVID-19, and I suspect that they may be related to more general and fundamental problems that they have been having. We have worked hard to avoid the problems that others in the smart glass industry have had. I have noted consistently on our conference calls together that we judge our performance in 3 main areas: financial stability, operational efficiency, and business growth. We have already spoken about the first 2 areas. Financial stability and operational efficiency not only give us the resources to accomplish our targets, but they are especially important during volatile business and market periods like the current pandemic.

Now let's discuss the progress with key initiatives in the area of business growth that we outlined in prior conference calls. Expanding our business and where SPD-Smart technology is being used is important.

First, let me say a few words about the importance of diversification. One of the hallmarks of our business is that our technology is in highly diverse industries. Users of our technology are also diverse geographically. They are located on almost every continent in the world. There is also diversity within industries, take automotive, for instance, which is our largest market right now. The high end of the automotive market is one area that our SPD-SmartGlass technology is used in. The COVID-19 pandemic has affected this segment of the automotive industry differently. CNBC recently noted that Ferrari's market capitalization exceeded both Ford's and GM's. Some automakers posted large losses and some had profits in the first quarter. So what can we expect in the automotive market?

Some expect a strong rebound in automotive in areas that have begun to reopen. For example, there was a recent rush in Wuhan, China at car dealerships, which they say is a good indication that buyers will prioritize private transportation in a post-COVID-19 era. This reason was supported by a report in Automotive News yesterday that a recent consumer survey shows that a majority of the people surveyed who use ride-sharing apps and services, said that they would either use these services less or stop using them altogether. This is good for the auto companies, who over the past 2 years have lost substantial business and unit volumes because of the rise in ride share.

In the U.S., a lot of OEMs are scheduled to reopen production a week from this Monday. As noted, different segments of the automotive industry were affected in different ways. In the first quarter, Gentex, another automotive technology company, reported only a 3% decline in shipments of total auto-dimming mirror units compared to a 24% decline in global light vehicle production during the same quarter. Gentex's management said that the vast majority of the shortfall in sales occurred during the last couple of weeks in March due to the pandemic outbreak.

We don't know how fast the world will reopen. So Q2 for most companies will probably be lower as most of the economic impact of COVID-19 shutdowns do not begin to happen until late in the first quarter. And they look like they'll continue until sometime this month, covering a larger percentage of production in the second quarter. So Gentex's first quarter sales were down a little over 3%. We actually did much better in the first quarter. When we look at consecutive quarterly royalties, our royalties for the first quarter of 2020 in the automotive market were actually up over 28% compared to last quarter. This follows positive automotive results for us in 2019, where revenues from the automotive market were also up from the prior year.

Our 2 largest markets right now are automotive and aircraft. We did better in the first quarter of this year compared to the prior quarter or the last quarter of 2019. With respect to aircraft, industry analysts expect that general aviation might actually benefit from the COVID-19 pandemic. On our last conference call in March, we discussed the fact that one private jet fleet operator saw a 27% increase in its business this year, which it attributed to the coronavirus.

With airlines in financial trouble, canceling flights and less able to permit passengers to practice social distancing, private aircraft may indeed benefit from the current pandemic. One of our strongholds in the aircraft industry is the general aviation market, and the ability of our SPD technology to be retrofitted onto existing planes is a key advantage. So our business in aerospace is particularly focused on the private aircraft market.

In the first quarter of 2020 compared to the previous fourth quarter of 2019, we saw an increase in our royalties from aerospace.

Moving to the architectural market. The architectural market uses twice as much of the world's glass as the automotive market. It is potentially our largest market. With the opening of Gauzy's Stuttgart factory in the fourth quarter of 2019, and its ability to make SPD film 1.8 meters wide, this allowed us for the first time to practically address the large potential architectural market.

As we noted when Gauzy announced Hyundai's strategic investment in our industry, Gauzy's state-of-the-art material synthesis facility in Israel and its custom SPD production line strategically located in Germany are currently operating. They are producing SPD emulsion and light control film for the automotive, aircraft and architectural industries. Of course, like us and like all of our licensees, they are working with modified staffing and procedures to protect Gauzy's employees during the COVID-19 pandemic.

We noted that royalty income from the architectural market was up substantially in the fourth quarter of 2019. We did not see that same strength in the first quarter, but I do not believe that this was a result of anything other than the timing of key activities and projects in the market for architectural smart glass. One particular area of interest in the architectural market is the use of smart glass in hospitals to reduce germs and infections because they're easier to clean as well as their ability to allow hospital personnel to monitor patients more efficiently and also provide better privacy. Our licensees have been quite active in their marketing and business development efforts in this area.

Another area that may benefit from the COVID-19 pandemic is the information display market. With many people setting up their homes for working remotely and realizing that they could get work done productively there, they have been spending money in this area. As we have discussed in earlier investor conference calls, Research Frontiers' main participation in the information display market is the business that our licensee Nippon Sheet Glass has for next-generation televisions and other information displays that use SPD technology to improve picture quality. This business was up in 2019 compared to 2018.

With the postponement of the Tokyo Olympics in -- to 2021, Panasonic, which is using our technology for this purpose, may have postponed a high-profile opportunity to showcase their technology. However, we may still experience increased business in this area later this year as a result of the growing demand for more efficient home workspaces.

We received by e-mail before this call, questions from investors, and we addressed many of the general topics in our presentation today. Here are some of the additional questions that were e-mailed to us. Apart from Hyundai, the impact of COVID-19, [Ron Vestin] asked, if I could discuss Apple's recently issued patent that mentions controlling SPD windows.

Well, Ron, first of all, their patent covers the control of the windows, not the materials themselves, some other people had questions about that, I know you didn't. But they're talking about electronic systems to control our windows. And quite frankly, I'm honored that the company that brought Apple CarPlay and other types of sophisticated and user-friendly control devices, turn their attention to SPD-SmartGlass. And we've been talking to Apple over the years about many different things, some in automotive, some in other areas as well.

[Jared Albert] had written, is the unit measurement for the, quote, record amount of films sold in currency or in area?

Jared, it started -- that was in terms of surface area. It's the number of square meters of film.

Can you update if you still expect really big revenue growth to start in the second half of 2020 and are trends still on track to be #2 over the next 2 years.

Jared, all I could say on that is that both of these will depend on how fast the world restarts after COVID-19. And I don't think any company out there knows this.

[Rick Smith] had asked, I would like to know how does the capacity in Gauzy's factory translate into numbers of houses, planes, cars, et cetera, that can be made with SmartGlass.

I'm going to give you both Hitachi and Gauzy in that one. Gauzy's capacity in their Stuttgart facility is to produce 1 million square meters of SPD film per year. And Hitachi's capacity in their Ibaraki SPD film line is 400,000 square meters per shift. So it will depend on how many shifts they run. But if you just take Gauzy's production and average sunroofs today on a premium car is about 1 square meter, so that'd be about 1 million sunroofs. There's also about 10 million aircraft windows that could be covered with that film or about 700,000 architectural windows.

[Michael Crawford] asked about our plans for the annual meeting in June. As many of you are beginning to receive your proxy statements, you may know that our annual meeting is scheduled for the second Thursday in June as it is every year, and we're planning to have that at the company offices, just like we did last year. Some people have asked if we're going to broadcast it, but for the most part, most of that meeting is administrative where votes that came in prior to the annual meeting are just tallied and announced that day usually on -- in an 8-K, so we'll continue to do that. And the President's report that we used to give in prior years has become less and less important because now we're having that same report 4 times a year, and the annual meeting is only a couple of weeks away. So I'm not sure much is going to change in terms of what I would report at the annual meeting compared to today.

[Chuck Michaels] -- and by the way, if anyone does attend at our offices, please use your best judgment. We'll have precautions there, but -- and social distancing, but please think carefully about attending.

Chuck Michaels had written, please consider incorporating your answers to the following questions in your conference call presentation. How has COVID-19 affected Research Frontiers? We already talked about that.

When can we expect to hear more information as to additional auto OEMs incorporating SPD in new model vehicles? And what effect do you anticipate Gauzy's new funding, including from an auto manufacturer will have on Research Frontiers?

Well, this is clearly a question that can best be answered by some very bold actions by Hyundai. Hyundai invested in Gauzy, along with some other strategic investors and this multimillion-dollar investment that they made, I think, is a very good indication as to where they see the smart glass industry going and the benefits that they could achieve from it. So we're quite excited. And they are the first OEM to have invested in the smart glass industry that we know of. They're also the first high-volume car maker in the world to make such a public move with SPD. So we're quite excited about that.

[August Permin] had indicated, Hyundai's investment in Gauzy, does that make Hyundai a licensee of ours? Well, automakers don't need to be a direct license of ours as long as they buy SPD-SmartGlass from a licensee. And will other current prospective OEMs be less inclined to want to use Gauzy's SPD product, if they feel Hyundai is already associated? I actually think they'll be more inclined to do that. It shows that SPD can be used by high volume, successful auto manufacturers and higher volumes will get cost down for every OEM, not just Hyundai, making it even more likely that other OEMs will adopt SPD. But I think it was a very important statement in the world of smart glass that Hyundai has done that.

Next question from Mr. Permin was, is Hitachi still enthusiastic about SPD, or have they been less aggressive with potential OEMs now that Gauzy seems to be the vocal leader of our technology?

Actually, Hitachi has been aggressively pursuing the SPD business, more so than ever. And because SPD film sales are mostly B2B, you don't see many public statements, especially since they're a Japanese company. But remember, they had a 12-year record in terms of the amount of SPD film sold last year. So I don't think they're anything but encouraged. And they've also expressed to me that they believe Gauzy competing with them has actually reinvigorated the SPD market. So I think they're more excited than ever and have every reason to be.

When will I be able to buy an aftermarket visor for my car? We're going to talk about automotive sun visors a little later on in an answer to another question.

Was there a delay in delivering SPD film to SER? Have they made any sales in Brazil using our product? When can we see the armored glass product in use?

Well, to answer your question, Gauzy has delivered SPD film to SER in Brazil. And I'm pretty sure that the armored glass area, you'll see some very, very high-profile uses of SPD-SmartGlass. The other question was about Panasonic, which we answered.

[Sam Penta] had indicated, I noticed that McLaren is starting to promote the launch of the Speedtail. In one article, it is quoted that the glass darkens the top of the windscreen, removing the need for a sun visor, and the same technology is applied to the upper section of the doors, the port hole and the rear quarter lights. This is the first time SPD will be used in the windshield as a visor and on side windows.

While the car is a limited release, it bodes well for the future. Is there wide-scale plans for automakers to use the technology in their windshield? And then Mr. Penta notes, Gentex market cap is billions of dollars based on just a dimmable rearview mirror. What kind of market penetration could SPD achieve with dimmable visors in the windshield?

Well, there's been a number of different automakers that have talked about, tested and will implement sun visors using our technology. The only one that's been made public so far is McLaren and the Speedtail. Just today, I received a really nice video from them where they're starting to talk about the materials that are used in the GT, which is their other new car. And if you look at the roof, you'll see our roof right there, so nice to see.

I'm going to now ask our operator, Erica, to open up today's conference call to any additional questions people participating today might have that we haven't already covered.

(Operator Instructions)

Our first question comes from [Art Brady].

Joe, I'm just wondering, can you elucidate a little bit more on what's happening in Brazil?

Well, I had the pleasure of visiting SER. They have a very aggressive operation, and they're 1 of the 2 market leaders, AGP, our other licensee being the other one. They have a really good business in terms of aftermarket. They work with the blindadoras, which are the companies that will take a car in the aftermarket and update it with armored steel. In this case, it's a Kevlar-type material that's actually lighter. It's stronger than Kevlar for the door panels and other nontransparent areas and in the transparent area, using SPD.

And it adds some real benefits because, first of all, it's an aftermarket product in general. So they have an infrastructure in place in Brazil to have many shops actually do these kind of upgrades, which is very good for our business because I think it's -- because of the security situation over there, a more developed market. It's about 3x larger. It's about 1,500 cars per month in Brazil in the armored glass market compared to about 500 cars per month in Mexico, which is the second largest market.

And as I alluded to earlier, you'll probably see some extremely high-profile and highly visible uses of our technology in the not-too-distant future, even here in the United States.

Joe, can you also comment on Isoclima? We haven't heard about their participation in quite a while.

Art, they are very active. They're working on many different industries, but primarily automotive and aircraft, and they're working with major players in those areas. So they are a good company that has done a great job. And when it comes to understanding glass and glass structure, they're probably the best in the world. So we're really honored to have people like Dr. [McCauley], who probably knows more about Gorilla Glass than Corning even does. So hopefully that...

Any new products that they are actually putting into production at this point?

Sure. Sure. Like I mentioned, the aircraft and automotive primarily, including some from Mercedes.

Our next question comes from [Thomas McCarthy].

Joe, you mentioned that Hitachi can, in 1 shift, make 400. Did you say square feet or square meters?

No. It's 400,000 square meters per year per shift. So that's their annual production per shift.

400,000 square meters annually.

Per year. Annually. So that's about 1.3 million. I'm sorry, we did 3 shifts.

Yes. 1.2. Okay. And Gauzy?

I was talking in meters -- I mean, in square feet, sorry. I -- sometimes I switch between the two.

And you are saying Gauzy?

No, let's go back to Hitachi. I want to make sure I understand. They can produce in 1 shift, 400,000 square feet annually.

No, meters. 400,000 square meters per year per shift.

Okay. And what did you just say about feet?

That's about each 400,000 square meters is about 1.3 million square feet per shift.

Oh, I was thinking you were multiplying it by 3 shifts. I'm sorry.

No.

Okay. Now in terms of Gauzy, you said 1 million. And is that 400,000 square meters per year?

Square meters per year. Right.

And that's just 1 shift?

It's the blend of what they expect their production requirements to be. I'm not allowed to go into more detail than that.

All right. Fine. Now the question is all this film that's being produced, are there ready customers for it or is it being stockpiled?

Nobody in the industry, including Hitachi, stockpiles the film. When they make it, it's usually for a customer order. They'll have some in inventory, but not much. That's just to kind of deal with inventory management and there's a need for [wash-up].

Okay. Got you. So the figures you gave me are production capacity. Are...

Not production.

Sorry?

No. Yes. It's not production itself. It's production capacity.

Okay. Are you able to say anything about what the production figures are?

No, they won't let me.

Okay. Are they working? Are they...

Oh yes, both Gauzy and Hitachi are working.

And they're running a shift each?

They're running film, yes.

Our next question comes from [Allen Ginsberg].

I have 2 things. In January, there was a lot of excitement at Consumer Electronics Show when a Chinese smartphone manufacturer used in a smartphone with McLaren, what seemed like it might be SPD, but there was no press release whether it was SPD or something else. I wanted you to comment on that, if you will, and then I have one more.

Sure. So that was concept one. That was a concept phone. It wasn't a production phone, although, they do hope it will go into production. And like many manufacturers, they don't like to tell what technology they're using in their products because it tips off their competitors. We have actually seen, though, in other markets, too, especially with things like cellphones and other Amazon devices being able to be hacked so that you could take control of the camera on your laptop or your phone or something like that, an increased interest in the privacy covers for the phone video and also the laptop and...

But is this -- can you comment on whether this is SPD that they were using in this phone or not?

Not unless they do it. Not unless they commented.

All right. All right. Because the way it was described, it seemed like it had to be SPD, but we'll have to wait on that, I guess. The other thing is, you had said that you had hired a public relations firm, but I don't know the name of that firm, and there's been very few press releases for a long time. Could you comment on that?

Well, first of all, Allen, we released press releases when there's information. A few weeks ago, we released a press release about Hyundai, so I can't imagine it. Yes. And I believe you've actually spoken to the Investor Relations person because he's...

But occasionally, I've tried to call him and I haven't been able to get through. His mailbox is full. So you might want to check into that, all right?

Okay. Yes, I will.

(Operator Instructions) Our next question comes from [Vasilio].

Joe, condolences for your father-in-law. Sorry to hear that.

Thank you, Vasilio.

I just wanted to see if you could give us some color about pricing, especially for the architectural market. It's a very competitive place. So anything you could share, that would be appreciated.

I usually get in trouble when I share publicly pricing information. We had one case a couple of years ago where a reporter had quoted an estimate I had given on the per square foot price for SPD-SmartGlass and the licensee called me up saying, "I was just quoting 50% more than that to a customer, and now I have to do some explaining." So I should be very careful. But let me maybe back into the question. We have done an analysis of the architectural market, which is, to a large extent, a very competitive market, you're correct. And we've actually spoken to some of the largest building facade manufacturers in the world. And they are probably the experts on what they need to charge for a window and a window shading system. And based on the numbers that Gauzy gave them and I was in that meeting in Europe, we can meet the current price that they need the window and the shade to be because remember, you don't need both now and you don't need the ancillary motors and rollers and things like that with SPD-SmartGlass. So our system could actually be cost competitive in high-volume to an ordinary window with an ordinary window shade based on the projected pricing that Gauzy gave them.

Our next question comes from [Ted Eddies].

As the production or the demand starts increasing, are there any other production facilities in with that in the works to produce more film?

Yes. Gauzy has talked about a third production facility. So they have one for PDLC in Israel in Tel Aviv. They have an SPD only 1 in Stuttgart, and they're talking about a third one. And I'm not sure I could tell you where it's going to be, but it will be either in North America or in Asia most likely.

(Operator Instructions) Our next question comes from [Alan Denver].

I had tough times this -- earlier this year also.

I'm sorry to hear that.

COVID problems, yes. Long Island hasn't been any good either, I know. So my question is a very simple one. Has anyone come to the company or to you and asked about being acquired, that they could acquire Research Frontiers?

No.

At this time, we have no further phone questions.

Okay. In that case, if we haven't fully answered any questions that were e-mailed to us or in the presentation today or the live Q&A, feel free to e-mail us. And I'd like to now make some closing remarks.

Last year was spent building and strengthening Research Frontiers. We needed to have multiple producers of SPD film. This has been done. We needed to have wider SPD films so that we could pursue the architectural glass market. This, too, has been done. We needed to have SPD technology available at lower cost to the customer. This has been done. We needed a stronger balance sheet. This too has been done. We wanted to reduce internal expenses. This has been done, not only last year, but in each of the past 5 years, and we expect cost reductions to continue in the coming year. We needed greater awareness in the various industries as to what SPD-Smart technology could do for customers. We expanded our public relations effort and spoke at various industry conferences.

Let's never lose sight about why customers use our SPD-SmartGlass technology. In automotive, we may cause more energy efficient, reduce CO2 emissions by 4 grams per kilometer and increase the driving range of electric vehicles by up to 5.5%. We also make people more comfortable and safer and protect the interiors of cars. In architectural applications, we make buildings more comfortable, energy-efficient and functional. We preserve nice views. We have seen from the hospital market that curtains and shades can collect allergens, dust and germs. With the growing movement as a result of recent events, including the coronavirus, another aspect of our technology, the ability for SmartGlass to be more easily cleaned than shades or blinds can be important.

This worldwide promotion of the benefits of SPD has been quite effective. Customers with new uses for our technology as well as traditional ones are all coming to us and our licensees. You saw Hyundai so far this year come on board. And we are well positioned for the future, even in the realities of a post-COVID-19 world. We have enough cash for the next 3 years, a very modest quarterly burn rate, and we expect to continue to be debt-free and our expenses have continuously come down. These cost reductions were important steps we took to bring us closer towards being cash flow positive and profitable. They yielded additional benefits during the current COVID-19 pandemic.

The other key initiatives were making SPD technology more affordable to the customer. We and our licensees have made investments in these areas and great progress. Having Hyundai makes such a visible move in the world of SPD-SmartGlass, probably is one of the best things that I could point to in order to illustrate the cost reductions, performance, reliability and feasibility of SPD. McLaren and others using SPD in areas other than the roof is another benefit in this area.

A stronger, more efficient supply chain and lower product costs and higher production capacity, all make it easier for companies to use our technology. We have had good results in our car markets and new projects in all industries. These industries have a better understanding of the benefits of using our SPD-SmartGlass technology. We and our licensees are opening up new markets, such as the large architectural smart glass market. Our licensees are pushing hard in this market and we could also benefit from the more than 50 certified laminators that Gauzy already has in this market as well as our own licensees in the architectural market.

As I mentioned, one area of particular interest is use of smart glass in hospitals and another in homes for making -- working remotely more productive and pleasant. And one of our best leading indicators of future economic activity is SPD film sales, since it is this film that gets put into the end products that we receive a royalty from. Just with Hitachi Chemical sales alone, the amount of SPD film sold in 2019 exceeded the annual amounts sold in all prior years since the beginning of its production, that was a 12-year record.

At Research Frontiers, we're tough, we're scrappy, and we have weathered past economic crises. While no one could have predicted it, we were prepared for the current pandemic. I think that a large part of this survival and even the ability to thrive even in difficult times, comes from some of our core principles that we -- that have helped us lead the growing smart glass industry. We noted some of these core principles today: building a strong and enduring company through focus, hard work and determination; raising money on favorable terms when we do not need it so it's available when we do; a constant focus on maintaining a lean operation with minimal capital expenditure requirements; a strategic focus on key markets and industries; and building a business that is well diversified across industries and within industries.

Particularly good examples of this are our positions in key segments of the automotive and aircraft industries that we spoke about earlier. Another key point is that we are well diversified across geographic reasons, while part -- regions. While parts of the world have been shutting down or slowing, other parts of the world at the same time are restarting. We did this while at the same time building a world-class and reliable light control technology that has brought benefits to so many people and companies around the world.

And I want to thank you, our strong and loyal investors, for your support while we built these qualities into our business. And I particularly want to express my wish to each of you, please stay safe and healthy as we move through the current pandemic together.

This concludes today's conference call. Thank you for attending.