Varex Imaging Corp (VREX) 2020 Q2 法說會逐字稿

Greetings, and welcome to Varex Imaging Corporation Second Quarter Fiscal Year 2020 Earnings Conference Call. (Operator Instructions) As a reminder, this conference is being recorded.

您好，歡迎參加 Varex Imaging Corporation 2020 財年第二季財報電話會議。 （操作員指示）謹此提醒，本次會議正在錄製中。

It is now my pleasure to introduce your host, Howard Goldman, Director of Investor Relations. Thank you. You may begin.

現在我很高興向您介紹主持人，投資者關係總監霍華德·戈德曼。謝謝。你可以開始了。

Good afternoon, and welcome to Varex Imaging Corporation's earnings conference call for the second quarter of fiscal year 2020. With me today are Sunny Sanyal, our President and CEO; and Clarence Verhoef, our CFO.

下午好，歡迎參加 Varex Imaging Corporation 2020 財年第二季財報電話會議。今天和我在一起的有我們的總裁兼執行長 Sunny Sanyal；以及我們的財務長 Clarence Verhoef。

To simplify our discussion, unless otherwise stated, all references to the quarter are comparisons for the second quarter of fiscal year 2020 versus the second quarter of fiscal year 2019.

為了簡化我們的討論，除非另有說明，所有提及該季度的內容都是 2020 財年第二季與 2019 財年第二季的比較。

On today's call, we will discuss certain non-GAAP financial measures. These adjusted measures are not presented in accordance with, nor are they a substitute for, GAAP financial measures. We provided a reconciliation of each adjusted financial measure to the most directly comparable GAAP financial measure in our earnings press release, which is posted on our website.

在今天的電話會議上，我們將討論某些非公認會計準則財務指標。這些調整後的指標並非依照公認會計原則財務指標提出，也不能取代公認會計原則財務指標。我們在我們網站上發布的收益新聞稿中提供了每項調整後的財務指標與最直接可比較的 GAAP 財務指標的調整表。

Please be advised that during this call, we will be making forward-looking statements, which are predictions or projections about future events. These statements are based on current expectations and assumptions that are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated. Additional information concerning factors that could cause actual results to materially differ from those anticipated is contained in our SEC filings, including Item 1A, risk factors of our quarterly reports on Form 10-Q and our annual report on Form 10-K. The information in this discussion speaks as of today's date, and we assume no obligation to update or revise the forward-looking statements in this discussion.

請注意，在本次電話會議中，我們將做出前瞻性陳述，即對未來事件的預測或預測。這些陳述是基於目前的預期和假設，這些預期和假設存在風險和不確定性，可能導致實際結果與預期有重大差異。有關可能導致實際結果與預期結果有重大差異的因素的更多資​​訊包含在我們向 SEC 提交的文件中，包括第 1A 項、表格 10-Q 季報告和表格 10-K 年度報告的風險因素。本次討論中的資訊截至今天為止，我們不承擔更新或修改本次討論中的前瞻性陳述的義務。

And now I'll turn the call over to Sunny.

現在我將把電話轉給 Sunny。

Thank you, Howard. Good afternoon, and welcome. Since our last earnings call in February, the world around us has changed dramatically due to the COVID-19 pandemic. Before discussing our results for the second quarter, on behalf of everyone at Varex, I want to thank all of the selfless professionals and volunteers on the front lines around the world, fighting against this global pandemic. And I would also like to thank our customers and our suppliers for working closely with us to manage the impact of COVID-19. I'm also grateful that all of our 2,000-plus employees around the world are safe and well and that all our factories and service centers are operational and staffed by our essential personnel. We have implemented strong social distancing and good hygiene practices. And with many nonproduction employees working from home, we're using our video conferencing systems effectively for internal and external meetings.

謝謝你，霍華德。下午好，歡迎光臨。自 2 月上一次財報電話會議以來，我們周圍的世界因 COVID-19 大流行而發生了巨大變化。在討論第二季的業績之前，我謹代表 Varex 的所有人，感謝世界各地抗擊這一全球流行病前線的所有無私的專業人士和志工。我還要感謝我們的客戶和供應商與我們密切合作管理 COVID-19 的影響。我還很感激我們在世界各地的 2,000 多名員工都安全無恙，我們所有的工廠和服務中心都在運作並由我們的重要人員配備。我們實施了嚴格的社交距離和良好的衛生習慣。由於許多非生產員工在家工作，我們正在有效地使用視訊會議系統進行內部和外部會議。

In addition to health and safety actions, we took some extraordinary measures in our operations in the Philippines, where we manufacture some high-volume products. The strong lockdown initiated by the local government disrupted public transportation and commuting, making it virtually impossible for many of our workers to get to our production site. I'm glad to say that we were able to make arrangements for many of the impacted workers to be sheltered in our premises. This arrangement allowed us to not only maintain business continuity but also to ensure on-time delivery for our customers.

除了健康和安全行動之外，我們還在菲律賓生產一些大批量產品的業務中採取了一些非常措施。地方政府發起的強力封鎖擾亂了公共交通和通勤，使我們的許多工人幾乎無法到達生產現場。我很高興地說，我們能夠安排許多受影響的工人在我們的場所得到庇護。這種安排不僅使我們能夠保持業務連續性，而且還能確保為客戶按時交貨。

The COVID-19 pandemic began to impact our business in the second quarter. Although our revenues increased over the prior year quarter, we experienced a substantial shift in mix between our business segments and within each segment that lowered our overall margins. Revenues for the second quarter increased to $197 million from $196 million in the prior year quarter. Medical segment revenues increased 4% to $155 million, while Industrial segment revenues decreased 11% to $42 million.

COVID-19 大流行從第二季開始影響我們的業務。儘管我們的收入比去年同期有所增長，但我們的業務部門之間以及每個部門內部的組合發生了重大變化，這降低了我們的整體利潤率。第二季營收從去年同期的 1.96 億美元增至 1.97 億美元。醫療部門營收成長 4% 至 1.55 億美元，而工業部門營收下降 11% 至 4,200 萬美元。

In our Medical segment, a significant increase in sales of CT tubes and higher demand for certain other X-ray imaging products that assist with the fight against COVID-19 drove revenue growth. We increased production and met much of the incremental demand for CT tubes, radiographic tubes and detectors and high-voltage connectors. This growth was partially offset by a decline in sales of other medical products as our OEM customers managed their inventory levels in response to the uncertainty around spending for X-ray imaging systems.

在我們的醫療部門，CT 管銷售的大幅成長以及對某些其他有助於對抗 COVID-19 的 X 光成像產品的需求增加推動了收入成長。我們增加了產量，滿足了對 CT 管、射線管、偵測器以及高壓連接器的大部分增量需求。這一增長被其他醫療產品銷售下降所部分抵消，因為我們的 OEM 客戶管理庫存水準以應對 X 光成像系統支出的不確定性。

CT is one of the most versatile of diagnostic imaging modalities, and growth that we're seeing in new CT system installations demonstrates this. The fight against COVID-19 has shown us this versatility as practitioners have been using CT systems to assist in diagnosing complications from COVID-19. Demand for CTS continued to be healthy and we anticipate demand to remain solid over the coming quarters. Our success in CT is driven by several factors. First, we've forged long-standing relationships with our global OEM customers. It's not uncommon for us to have customer relationships that exceed 25-plus years. These customers, particularly our largest customer who drove the vast majority of our growth in CT tube sales during the quarter, all continue to win in the market with systems that include our advanced and cost-effective technologies. Second, our leadership in innovation drives new technology adoption, and our global OEM customers continue to rely on Varex for their future product needs. Despite disruption in operations from the pandemic, most of our OEM customers continue to move forward with their CT system introduction plans. Third, the scalability of our operations is an advantage that our customers value. As I previously mentioned, some of our customers saw an uptick in demand for their systems that was driven by COVID-19, and we were able to fulfill most of this demand during the quarter. While the dental, mammography and oncology markets appear to have slowed down globally due to the pandemic, we firmly believe that this is a temporary situation for us. These are markets where we are well known as an innovation leader, and OEMs have responded very favorably to our recent product introductions. Despite the pandemic, there have not been any notable slowdowns in the rollout of our new detector technologies, such as our high-performance and cost-effective Z Platform for dental, surgical, cardiovascular and other dynamic applications. Customer projects in these areas are moving forward. At the same time, we have continued to make solid progress with our plans for introducing locally made radiographic and dental detector products in China and have begun shipping these products in increasing quantities. Our new portable wireless detector is currently one of the lightest and the most robust detectors in the world with best-in-class specifications, and we're very encouraged by the traction that it has received from OEMs developing mobile X-ray systems.

CT 是最通用的診斷影像方式之一，我們在新 CT 系統安裝中看到的成長證明了這一點。對抗 COVID-19 的鬥爭向我們展示了這種多功能性，因為從業人員一直在使用 CT 系統來協助診斷 COVID-19 併發症。對 CTS 的需求持續健康，我們預計未來幾季的需求將保持穩定。我們在 CT 領域的成功受到多種因素的推動。首先，我們與全球 OEM 客戶建立了長期合作關係。對我們來說，擁有超過 25 年以上的客戶關係並不罕見。這些客戶，特別是我們最大的客戶，他們在本季度推動了我們 CT 管銷售的絕大多數成長，他們都繼續憑藉包含我們先進且具有成本效益的技術的系統贏得市場。其次，我們在創新方面的領先地位推動了新技術的採用，我們的全球 OEM 客戶繼續依賴 Varex 來滿足他們未來的產品需求。儘管疫情導致營運中斷，但我們的大多數 OEM 客戶仍在繼續推進 CT 系統引進計畫。第三，我們營運的可擴展性是我們的客戶所重視的優勢。正如我之前提到的，由於 COVID-19，我們的一些客戶的系統需求增加，我們能夠在本季滿足大部分需求。雖然牙科、乳房X光檢查和腫瘤學市場似乎因疫情而在全球放緩，但我們堅信這對我們來說只是暫時的情況。在這些市場中，我們以創新領導者而聞名，原始設備製造商對我們最近推出的產品反應非常積極。儘管發生了大流行，我們新探測器技術的推出並沒有出現任何明顯的放緩，例如我們用於牙科、外科、心血管和其他動態應用的高性能且經濟高效的 Z 平台。這些領域的客戶專案正在取得進展。同時，我們在中國引進本土製造的放射線和牙科探測器產品的計劃繼續取得紮實進展，並已開始增加出貨量。我們的新型便攜式無線探測器是目前世界上最輕、最堅固的探測器之一，具有一流的規格，開發行動 X 射線系統的 OEM 廠商對它的大力支持令我們深受鼓舞。

In summary, we feel very confident that our medical detector and tube technologies are hitting the mark, and we expect to come out of this temporary pause competitively stronger than before.

總而言之，我們非常有信心我們的醫療探測器和管技術正在達到目標，並且我們期望在擺脫這一暫時的停頓後，具有比以前更強的競爭力。

In our Industrial segment, a decline in world oil prices led to significantly lower sales of products for our cargo screening at ports and borders. Most projects of this type are typically tender-driven and funded by governments, many of which are located in oil-producing regions of the world.

在我們的工業部門，世界石油價格下跌導致我們在港口和邊境進行貨物檢查的產品銷售大幅下降。大多數此類項目通常由招標驅動並由政府資助，其中許多項目位於世界石油生產地區。

Similarly, in the NDT market, product sales to our customers in the oil and gas vertical decreased substantially as spending contracted sharply. Product sales for other NDT applications also declined considerably due to the global economic impact of COVID-19 on many companies that manufacture commercial and consumer products.

同樣，在無損檢測市場，由於支出急劇收縮，石油和天然氣垂直領域客戶的產品銷售大幅下降。由於 COVID-19 對許多製造商業和消費品的公司的全球經濟影響，其他 NDT 應用的產品銷售也大幅下降。

In the second quarter, product sales for our airport security market increased. However, given the precipitous drop in global air travel due to COVID-19, we anticipate a decline in product sales for this application in the second half of this fiscal year.

第二季度，機場安檢市場產品銷售量有所成長。然而，鑑於 COVID-19 導致全球航空旅行急劇下降，我們預計本財年下半年該應用程式的產品銷售將下降。

Despite temporary headwinds, we continue to believe that the Industrial segment remains an attractive part of our business with long-term growth potential. Overall, the COVID-19 pandemic and its impact on the global economy has created a disruption to Varex' business, which includes significant uncertainty in demand for certain products for our Medical and Industrial applications as well as variability in our supply chain and manufacturing productivity. We expect this uncertainty to continue for at least the remainder of the current fiscal year. As a result, we're withdrawing our previously issued guidance for fiscal year 2020.

儘管存在暫時的阻力，我們仍然相信工業領域仍然是我們業務中有吸引力的部分，具有長期成長潛力。總體而言，COVID-19 大流行及其對全球經濟的影響對Varex 的業務造成了乾擾，其中包括我們的醫療和工業應用某些產品的需求存在重大不確定性，以及我們的供應鏈和製造生產力的改變。我們預計這種不確定性至少將持續到本財年剩餘時間。因此，我們將撤回先前發布的 2020 財年指引。

To help improve our financial condition and better enable our business to weather the extraordinary challenges associated with COVID-19, in the second quarter, we initiated a series of cost reduction and cash preservation measures that will continue to -- into the second half of our fiscal year.

為了幫助改善我們的財務狀況並更好地幫助我們的業務應對與 COVID-19 相關的巨大挑戰，我們在第二季度啟動了一系列成本削減和現金保存措施，這些措施將持續到下半年。財政年度。

For example, we have pulled in the closure date of our Santa Clara facility by full quarter into the fourth quarter of the current fiscal year. In the United States, we are reducing labor costs through furloughs and targeted reductions in personnel. In addition, for the remainder of this fiscal year, through a combination of 2 weeks of leave without pay and temporary salary reductions, we will be reducing cash compensation for our nonproduction employees by approximately 10% to 30%, depending on the job level. My salary will effectively be reduced by 30%, and the other members of our Board of Directors have agreed to a 30% reduction in their annual cash retainer for the second half of this fiscal year.

例如，我們已將聖克拉拉工廠的關閉日期提前整個季度推至本財年的第四季。在美國，我們正在透過休假和有針對性的裁員來降低勞動成本。此外，在本財年剩餘時間內，透過兩週的無薪休假和臨時減薪，我們將根據工作等級將非生產員工的現金補償減少約 10% 至 30%。我的薪水實際上將減少 30%，我們董事會的其他成員也同意將本財政年度下半年的年度現金保留金減少 30%。

Internationally, we're exploring and implementing salary reductions and reduced work schedules, each in line with local guidelines. We're temporarily suspending the company's 410(k) match, along with cash components of employee recognition programs. We have reduced and will continue to reduce other discretionary expenses. And we're taking actions on low-margin products in our portfolio to either increase prices or discontinue the products.

在國際上，我們正​​在探索並實施減薪和減少工作時間，每項都符合當地的指導方針。我們暫時暫停公司的 410(k) 匹配以及員工表彰計劃的現金部分。我們已經並將繼續減少其他可自由支配的開支。我們正在對產品組合中的低利潤產品採取行動，要麼提高價格，要麼停產這些產品。

In aggregate, we expect these actions to reduce costs by approximately $15 million to $20 million over the remainder of this fiscal year.

總的來說，我們預計這些行動將在本財年剩餘時間內減少約 1,500 萬至 2,000 萬美元的成本。

There are other long-term actions under evaluation as well. We're targeting additional cost reductions across our entire business as we look closely at the broad portfolio of our product lines, assets and facilities as well as our overhead cost structure. We expect to begin implementing these changes in the second half of 2020. The leadership team and I are committed to delivering on this, and we will provide additional details over the next few quarters.

還有其他長期行動正在評估中。我們的目標是進一步降低整個業務的成本，因為我們密切關注我們的產品線、資產和設施的廣泛組合以及我們的間接成本結構。我們預計在 2020 年下半年開始實施這些變革。我和領導團隊致力於實現這一目標，我們將在接下來的幾季提供更多詳細資訊。

With that, let me hand over the call to Clarence to talk about our financial performance in greater detail.

接下來，讓我將電話轉交給克拉倫斯，更詳細地討論我們的財務表現。

Thanks, Sunny, and hello, everyone. Before I go into the details of the second quarter performance, I wanted to discuss liquidity. The cost actions that Sunny just reviewed are for 2 purposes. They will help to improve the P&L performance, and they are critical for cash preservation. We have recently taken other actions to manage our cash as well. Several months ago, we put a hold on all capital equipment spending other than that what was needed to increase production for high-demand products. We continue to target reducing inventory levels while managing our manufacturing build schedule due to the frequently changing customer demands. We are closely monitoring our customer payment patterns and negotiating with our suppliers on payment terms. We are taking additional steps to strengthen our balance sheet. At the end of March, we modified the covenants of our credit facility to increase the allowable leverage ratio to 4.25x adjusted EBITDA. In April, we borrowed the remaining balance of our credit facility that provided us with an additional $65 million of cash. We're in the process of pursuing other sources of capital, including the U.S. Government Main Street Lending Program.

謝謝，Sunny，大家好。在詳細介紹第二季業績之前，我想先討論一下流動性。 Sunny 剛剛審查的成本行動有兩個目的。它們將有助於提高損益績效，並且對於現金保存至關重要。我們最近也採取了其他行動來管理我們的現金。幾個月前，除了增加高需求產品產量所需的支出外，我們暫停了所有資本設備支出。由於客戶需求經常變化，我們繼續以降低庫存水準為目標，同時管理我們的製造建造計劃。我們正在密切監控客戶的付款模式，並與供應商就付款條件進行談判。我們正在採取額外措施來加強我們的資產負債表。 3 月底，我們修改了信貸安排的契約，將允許的槓桿率提高至 4.25 倍調整後 EBITDA。 4 月份，我們借用了信貸額度的剩餘餘額，為我們提供了額外的 6,500 萬美元現金。我們正在尋求其他資金來源，包括美國政府大街貸款計劃。

Now turning to the quarter. We had good revenue performance, while both gross and operating margins were weighed down by segment and product mix and some onetime events. For the second quarter, revenues were $197 million compared to $196 million in the prior year quarter. Medical revenues for the quarter increased $6 million to $155 million, and Industrial revenues decreased $5 million to $42 million. For the second quarter, our gross margin was 29% compared to 33% in the prior year quarter. Medical segment gross margin declined by about 3 points. During the quarter, we incurred onetime costs of approximately $2 million related to a customs audit in Europe and approximately $1 million of accelerated depreciation related to the closure of the Santa Clara facility.

現在轉向季度。我們的收入表現良好，但毛利率和營業利潤率均受到細分市場和產品組合以及一些一次性事件的拖累。第二季營收為 1.97 億美元，去年同期營收為 1.96 億美元。該季度的醫療收入增加了 600 萬美元，達到 1.55 億美元，工業收入減少了 500 萬美元，達到 4,200 萬美元。第二季度，我們的毛利率為 29%，而去年同期為 33%。醫療板塊毛利率下降約3個百分點。本季度，我們因歐洲海關審計而產生了約 200 萬美元的一次性成本，並因關閉聖克拉拉工廠而產生了約 100 萬美元的加速折舊。

Industrial segment gross margin decreased by about 4 points versus the prior year due to an unfavorable mix of lower-margin products. Overall, our adjusted gross margin was 32% compared to 34% in the prior year quarter, primarily due to the lower volume and performance in the Industrial segment.

由於低利潤產品的不利組合，工業部門毛利率較前一年下降約 4 個百分點。整體而言，我們調整後的毛利率為 32%，而去年同期為 34%，這主要是由於工業領域的銷售和表現較低。

R&D expenses were $21 million in the second quarter, an increase of $2 million from the prior year quarter, primarily due to the inclusion of direct conversion. As a percent of revenues, R&D expense was about 11% for the quarter.

第二季研發費用為 2,100 萬美元，比去年同期增加 200 萬美元，主要是因為納入了直接轉換。本季研發費用佔營收的百分比約為 11%。

Second quarter SG&A expenses were $35 million and included approximately $4 million of expenses related to acquisition integration, restructuring and other nonoperational costs. SG&A expenses also increased approximately $3 million versus the prior year due to audit and consulting fees associated with the implementation and remediation of new accounting standards. SG&A expense for the prior year quarter were $30 million and included approximately $6 million of expenses related to restructuring and other nonoperating costs.

第二季銷售、管理及行政費用為 3,500 萬美元，其中包括約 400 萬美元與收購整合、重組和其他非營運成本相關的費用。由於與新會計準則的實施和補救相關的審計和諮詢費用，SG&A 費用也比前一年增加了約 300 萬美元。去年同期的銷售、管理及行政費用為 3,000 萬美元，其中包括約 600 萬美元的與重組和其他非營運成本相關的費用。

Depreciation and amortization totaled $11 million for the second quarter compared to $8 million in the prior year. As mentioned previously, the second quarter included $1 million of accelerated depreciation related to the closure of the Santa Clara facility.

第二季折舊和攤銷總額為 1,100 萬美元，而去年同期為 800 萬美元。如前所述，第二季包括與關閉聖克拉拉工廠相關的 100 萬美元加速折舊。

Our operating earnings for the second quarter were $1 million compared to $14 million in the year-ago quarter. Our adjusted operating earnings for the second quarter were $11 million compared to $23 million in the year-ago quarter. Interest expense in the second quarter was $5 million, which was comparable to the year-ago quarter. In April, we completed the payment of deferred consideration for the acquisition of Direct Conversion, which was based on a fixed amount of Varex shares. Due to the reduction of the Varex share price in the second quarter, we revalued the amount of the deferred consideration and recorded a onetime $3 million gain in other income. This gain is excluded from our adjusted net earnings.

我們第二季的營業利潤為 100 萬美元，而去年同期為 1,400 萬美元。我們第二季調整後的營業利潤為 1,100 萬美元，而去年同期為 2,300 萬美元。第二季利息支出為 500 萬美元，與去年同期相當。 4月份，我們完成了收購 Direct Conversion 的遞延對價的支付，以固定數量的 Varex 股份為基礎。由於第二季 Varex 股價下跌，我們重新評估了遞延對價金額，並在其他收入中記錄了一度 300 萬美元的收益。該收益不包括在我們調整後的淨利潤中。

Tax expense for the second quarter was less than $1 million compared to tax expense of $2 million in the prior year quarter.

第二季的稅務費用不到 100 萬美元，而去年同期的稅務費用為 200 萬美元。

We recorded a net loss of $2 million or $0.05 per diluted share in the second quarter compared to net earnings of $6 million or $0.15 per diluted share in the prior year quarter.

我們第二季的淨虧損為 200 萬美元，即稀釋後每股 0.05 美元，而去年同期淨利為 600 萬美元，即稀釋後每股 0.15 美元。

Adjusted net earnings for this quarter were $5 million or $0.12 per diluted share compared to $13 million or $0.34 per diluted share in the prior year quarter.

本季調整後淨利為 500 萬美元，即稀釋後每股收益 0.12 美元，而去年同期調整後淨利為 1,300 萬美元，即稀釋後每股收益 0.34 美元。

Diluted shares outstanding were 39.1 million shares versus 38.5 million shares in the prior year quarter.

稀釋後流通股數為 3,910 萬股，去年同期為 3,850 萬股。

Looking at our working capital. Accounts receivable increased by $4 million during the quarter. Days sales outstanding was 59 days compared to 57 days in the prior year quarter.

看看我們的營運資金。該季度應收帳款增加了 400 萬美元。銷售應收天數為 59 天，去年同期為 57 天。

Inventory increased $13 million in the second quarter to $282 million, primarily due to additional inventory in preparation for the transfer of detector production from Santa Clara to Salt Lake City.

第二季庫存增加 1300 萬美元，達到 2.82 億美元，主要是由於將探測器生產從聖克拉拉轉移到鹽湖城做準備而增加了庫存。

We ended the second quarter with cash and cash equivalents of $24 million. During the quarter, we increased debt by $2 million and ended the quarter with total debt outstanding of $383 million.

第二季結束時，我們的現金和現金等價物為 2,400 萬美元。本季度，我們的債務增加了 200 萬美元，本季末未償債務總額為 3.83 億美元。

Due to the uncertainty associated with the COVID-19 pandemic, we have withdrawn guidance for the fiscal year 2020. That said, directionally, we anticipate that the decline in revenues in the Industrial segment will continue through at least the end of the fiscal year.

由於與 COVID-19 大流行相關的不確定性，我們撤回了 2020 財年的指引。也就是說，從方向上看，我們預計工業部門的收入下降至少將持續到本財年末。

Now I'll turn it back over to Sunny for some closing comments.

現在我將把它轉回 Sunny 以獲得一些結束評論。

Thank you, Clarence. Before we get to questions, I'd like to emphasize that despite the significant near-term headwinds, our business fundamentals remain strong. We will continue to support our customers, we will continue to innovate and we will continue to take actions to ensure that Varex is well positioned into the future.

謝謝你，克拉倫斯。在我們提問之前，我想強調，儘管近期面臨重大阻力，但我們的業務基本面仍然強勁。我們將繼續支持我們的客戶，我們將繼續創新，我們將繼續採取行動，確保 Varex 在未來處於有利地位。

Varex is unique. We have been a leader in X-ray imaging industry for more than 70 years, and we continue on to plan to continue that leadership on for the next 70 years and beyond. We're a leader in both innovation and quality, and our customers recognize that. We have many multi-decade long relationships with customers who rely on Varex for their imaging system needs. We believe there will be continued long-term demand, not only for X-ray tubes and detectors, but for Varex' X-ray tubes and detectors.

Varex 是獨一無二的。 70 多年來，我們一直是 X 光成像行業的領導者，我們繼續計劃在未來 70 年及以後繼續保持這種領先地位。我們是創新和品質方面的領導者，我們的客戶也認識到這一點。我們與許多依賴 Varex 來滿足其成像系統需求的客戶建立了長達數十年的合作關係。我們相信，不僅對 X 射線管和探測器，而且對 Varex 的 X 射線管和探測器，都會有持續的長期需求。

We supply approximately 25% of all X-ray tubes and digital detectors globally and are the only independent manufacturer of both these products in the United States.

我們供應全球約 25% 的 X 光管和數位偵測器，並且是美國唯一生產這兩種產品的獨立製造商。

Thank you for your support. This is an unusual time, and we will not only get through this but emerge competitively stronger.

感謝您的支持。這是一個不尋常的時期，我們不僅會渡過難關，而且會在競爭中變得更強大。

We will now open it up -- the call for your questions.

我們現在將打開它——請大家提問。

(Operator Instructions) Our first question comes from the line of Anthony Petrone with Jefferies.

（操作員說明）我們的第一個問題來自 Anthony Petrone 和 Jefferies 的電話。

Just one quick housekeeping question. Just on the $2.1 million add back to gross margin, just a little bit of color there on that in particular. And then in terms of orders, specifically from the China backlog, anything you can provide in the way of CT tube demand this quarter and how that will trend into the back half? And then I'll have 2 quick follow-ups.

只是一個簡單的內務問題。僅就 210 萬美元的毛利率而言，這一點尤其值得一提。然後就訂單而言，特別是來自中國的積壓訂單，您可以提供本季度 CT 管需求方面的任何信息，以及下半年的趨勢如何？然後我將進行兩次快速跟進。

So I'll let Clarence take the first one. I'll take the second.

所以我會讓克拉倫斯拿第一個。我就拿第二個。

Yes, Anthony, I'll answer what's going on with the add back there. So this is related to the customs audit that's going underway in Germany, in particular. And so it's one of those things where we've booked some estimated amounts for the prior year customs payments associated with that. We are contesting it in the courts because there's been a ruling done by the customs authorities about which classification for our for our detectors, or for any detectors for that matter, that are being imported into Germany. And they've chosen a classification code that has a higher tariff rate than what we've historically used. And so this is going to be a bit of a process that will take some time to get resolved. I would say, it's going to go through the court process. But -- and I expect that we will probably end up booking a little bit more around that in the coming quarters as we get further clarity from the auditor in terms of the more recent time periods and all locations that we have in Germany.

是的，安東尼，我會回答後面的添加是怎麼回事。這尤其與德國正在進行的海關審計有關。因此，這是我們為上一年與之相關的海關付款預訂了一些估計金額的事情之一。我們正在法庭上對此提出異議，因為海關當局已就我們進口到德國的探測器或任何與此相關的探測器的分類做出了裁決。他們選擇的分類代碼的關稅稅率比我們歷史上使用的要高。因此，這將是一個需要一些時間才能解決的過程。我想說，這將通過法庭程序。但是，我預計，隨著審計員進一步澄清我們在德國的最近時間段和所有地點，我們最終可能會在未來幾季預訂更多的訂單。

Okay. So would you expect 2 point -- around that $2 million sort of add back to be repeated possibly next quarter and then trail off into the back half? Or will it sort of fluctuate from here?

好的。那麼，您是否預計 2 個百分點（大約 200 萬美元）可能會在下個季度重複出現，然後下降到後半段？或者它會從這裡開始波動嗎？

Yes. It's -- I'm going to just take an estimate that says that, yes, that's -- we would expect to see another number, whether it's in the next quarter or the next 2 quarters or something like that, a similar size kind of number to that. Hard to define exactly because the auditors still have to finish their work around it. So it's all about identified numbers versus kind of rough estimates. And at the time, we only book the amount that's clearly identified.

是的。我將做一個估計，是的，我們預計會看到另一個數字，無論是在下個季度還是接下來的兩個季度或類似的情況，類似的規模數到那個。很難準確定義，因為審計師仍然需要完成圍繞它的工作。因此，這完全取決於確定的數字與粗略的估計。當時，我們只預訂明確確定的金額。

And then Anthony, second part of your question, China orders, how things are going there. So CT and China have been the bright spots this quarter. And I'm very happy to say that things in China rebounded back fairly quickly. They were down for 6, 7 weeks. And when they came back. Things returned to normal fairly rapidly. And then our CT performance in China came right back to where -- in line with the trajectory that we were on. So we're very satisfied and happy with what's going on in China. And CT, in general, was a good performer for us. It was a combination of 2 things. One, our normal run rate for CT continued on and things progressed as we had anticipated. And in addition to that, we had additional demand during the quarter tied to COVID-19 related purchases that we anticipate that, that was used for assisting in diagnosis of COVID-19. So we had a nice bubble of CT during this quarter that we were able to deliver against. But the foundational demand there was in line with our expectations.

然後安東尼，你問題的第二部分，中國訂單，那裡的情況如何。因此，CT 和中國是本季的亮點。我很高興地說，中國的情況恢復得相當快。他們連續六、七週處於低迷狀態。當他們回來時。事情很快就恢復正常了。然後我們在中國的 CT 表現就回到了原來的水平——與我們所處的軌跡一致。所以我們對中國正在發生的事情感到非常滿意和高興。總的來說，CT 對我們來說表現良好。這是兩件事的結合。第一，我們的 CT 運作率持續正常，事情進展如我們預期。除此之外，本季我們還有 COVID-19 相關採購相關的額外需求，我們預計這些需求將用於協助診斷 COVID-19。因此，本季我們有一個很好的 CT 泡沫，我們能夠兌現這一承諾。但那裡的基本需求符合我們的預期。

Okay. And then 2 quick follow-ups. Sunny, you mentioned, obviously, headwinds in dental, in particular, and we've heard, obviously, on our end, lots of checks on the decrease in procedures and physician office closures. And then you also referenced the oil market. So headwinds in the Medical imaging space, but also Industrial. How do those 2 play out when you think about orders into the second half but also backlog? Is there a risk that the backlog gets impaired to an extent from these headwinds?

好的。然後進行 2 次快速跟進。桑尼，你顯然提到了牙科領域的逆風，尤其是，我們顯然聽到了對手術減少和醫生辦公室關閉的大量檢查。然後你也提到了石油市場。因此，醫學影像領域和工業領域都面臨逆風。當您考慮到下半年的訂單和積壓訂單時，這兩個因素如何發揮作用？這些不利因素是否會導致積壓訂單在一定程度上受到損害？

I'll start with the demand side. As we -- as I mentioned, for the second half of the year, we expect strength in CT to be as any other year as normal. CT just seems to have its own demand path. And as it's a very versatile modality. And when people have the choice of buying multiple modalities, and they have to pick one, it's usually CT. And so we're benefiting from that.

我將從需求方面開始。正如我所提到的，對於今年下半年，我們預計 CT 的實力將與其他年份一樣。 CT似乎只是有自己的需求路徑。因為它是一種非常通用的方式。當人們可以選擇購買多種檢查方式時，他們必須選擇一種，通常是 CT。所以我們正在從中受益。

Then that said, the other modalities, dental, mammography, as you've seen in the market, those came to a grinding halt. Physician offices stopped performing procedures. And they stopped coming into the office. So we've seen that stoppage. But our -- we're seeing external signs of dentists' offices opening up, but those haven't translated into a straight demand for us yet. But we believe that as soon as these outpatient clinics open up that we should start getting back to those kinds of volumes. Timing is a bit uncertain. Is it next quarter? Is it 2 quarters from now? That's where the uncertainty is. We're listening -- we're talking to our customers, dental customers, mammography customers weekly, daily and looking for signals. Since we're on the front end of the supply chain in this, we expect that we will get earlier signals than -- we're usually 3 months ahead of their production shipments. So we hope that we will be the first ones to know as demand comes right back there. We've seen dental demand in China come back, which is that if the other markets follow in that similar pattern, we would expect that physician offices, once they open up, then these outpatient-related system purchases will begin, resume. And then Anthony, sorry, for the last part of your question regarding -- I didn't get the -- the question clearly about oil and Industrial.

話雖如此，其他方式，牙科、乳房X光檢查，正如你在市場上看到的那樣，這些都陷入了停滯。醫生辦公室停止執行手術。他們不再進辦公室了。所以我們已經看到了這種停頓。但是我們看到牙醫診所開業的外部跡象，但這些還沒有轉化為對我們的直接需求。但我們相信，一旦這些門診診所開放，我們就應該開始恢復這些數量。時間有點不確定。是下個季度嗎？現在是2季之後嗎？這就是不確定性所在。我們正在傾聽——我們每週、每天與我們的客戶、牙科客戶、乳房X光檢查客戶交談並尋找訊號。由於我們處於供應鏈的前端，我們預計我們會比他們的生產發貨提前 3 個月收到更早的訊號。因此，我們希望我們能夠成為第一個知道需求回來的人。我們已經看到中國的牙科需求回升，也就是說，如果其他市場也遵循類似的模式，我們預期醫生辦公室一旦開放，那麼這些與門診相關的系統購買就會開始、恢復。然後安東尼，抱歉，關於你問題的最後一部分——我沒有明白——明確關於石油和工業的問題。

Yes. Just you mentioned oil in terms of the security detection business. That segment of that portfolio is within Industrial, just how that's playing out just in terms of demand for security detection, linear accelerators? And more so, if the backlog of that business is not at risk?

是的。剛才您提到石油安全檢測業務。該產品組合的這一部分屬於工業領域，在安全檢測、線性加速器的需求方面表現如何？更重要的是，如果該業務的積壓沒有面臨風險呢？

Yes. In general, we don't carry much of a backlog. As you know, we usually -- it takes -- our lead times for delivering products are anywhere between 90 to 120 days. So there's no real significant impact to any backlog or impairment to any backlog. What has happened in that segment of our market is that 2 factors played in. One, because of COVID-19, many of the security projects just came to a stop because people couldn't show up there to do the installations. And so that's why that was number one pause for the slowdown. Again, we are on the front end of this. So we felt probably a part of it. And then our customers who deliver those systems and install those systems felt the actual impact of the delay. But the delay also caused then other projects to ship -- move out. So that's why we saw a slowdown in cargo-related shipments during the quarter.

是的。一般來說，我們沒有太多積壓。如您所知，我們交付產品的交貨時間通常為 90 至 120 天。因此，對任何積壓訂單都沒有真正的重大影響，也沒有對任何積壓訂單造成損害。我們這個市場領域發生的事情有兩個因素在起作用。其一，由於 COVID-19，許多安全項目剛剛停止，因為人們無法到場進行安裝。這就是為什麼這是經濟放緩的第一個暫停。再一次，我們處於這方面的前沿。所以我們覺得可能是其中的一部分。然後，交付這些系統並安裝這些系統的客戶感受到了延遲的實際影響。但這項延誤也導致其他項目的交付——遷出。這就是我們在本季看到貨運相關出貨量放緩的原因。

The second part of this is oil prices. Oil prices usually have a slowing down effect on tenders that come out. So this business is largely tender-driven, and projects where we were expecting tenders to come out for our customers were, they all moved to the right. So that's the number two reason.

第二部分是石油價格。油價通常會對招標產生放緩影響。因此，這項業務很大程度上是由招標驅動的，而我們預計為客戶招標的項目，它們都向右移動了。這是第二個原因。

And related to that, related to the oil prices, we haven't -- we have a very good solid presence in the oil and gas vertical in our Industrial business. And there, as oil prices came down, the willingness to spend money also shrank. So we think that, that -- the oil and gas for industrial tubes, detectors and software will be tied more to those oil prices than COVID-19.

與此相關的是，與油價相關，我們沒有——我們在工業業務的石油和天然氣垂直領域擁有非常穩固的地位。而在那裡，隨著油價下跌，花錢的意願也隨之減弱。因此，我們認為，用於工業管道、探測器和軟體的石油和天然氣將比 COVID-19 與油價的關係更大。

Our next question comes from the line of Larry Solow with CJS Securities.

我們的下一個問題來自 CJS 證券的拉里·索洛 (Larry Solow)。

Just a few questions, a couple follow-ups. Just on the -- clearly, the COVID impact obviously started in China and whatnot, but probably for most of the quarter, you didn't feel much of it until the latter, probably 2, 3, 4 weeks. So just trying to -- I know you're not giving guidance, but just trying to get from a high level, trends in April as they -- in terms of sales and stuff, have they just really [performed] bad in some areas and others had been, like you said, in CT, remain kind of constant? Just trying to get some kind of feel or maybe even tell us what happened in the first quarter in terms of front half versus back half?

只是幾個問題，幾個後續行動。顯然，新冠疫情的影響顯然是從中國等地區開始的，但可能在本季的大部分時間裡，直到後者（可能是 2、3、4 週）你才感受到太多。所以我只是想——我知道你沒有提供指導，只是想從高水平上了解四月份的趨勢——在銷售和其他方面，他們在某些領域真的[表現]很糟糕嗎？就像你說的，其他人在CT 中保持不變？只是想獲得某種感覺，或者甚至告訴我們第一節前半場和後半場發生了什麼？

Well, Larry, I'll start out with a little bit -- first of all, I'm going to give you the reminder. Yes, we don't give specific guidance anymore, and I can't probably give too much color around this. I think the key point, though, is that around the Industrial side of the business, the slowdown that we saw -- and it started probably midway through the second quarter, not necessarily just the last few weeks of it. Because you've got to remember, we're more on the front end of the cycle. As Sunny was just mentioning. So -- and that slowdown in Industrial, all indications are that, that's continuing on -- and our expectation is the second half is going to see more of that.

好吧，拉里，我將從一點開始——首先，我要提醒你。是的，我們不再提供具體的指導，而且我可能無法對此給出太多的說明。不過，我認為關鍵點是，在業務的工業方面，我們看到了放緩——它可能從第二季中期開始，不一定只是在最後幾週。因為你必須記住，我們更處於週期的前端。正如Sunny剛剛提到的。因此，所有跡像都表明工業放緩仍在繼續，我們預計下半年將會出現更多放緩。

And I suppose it's gotten worse, right? At least in the last few week, right? I mean the...

我想情況變得更糟了，對吧？至少在過去幾週，對吧？我的意思是...

I'm not going to get very specific. But yes, I would say that the -- because if you're thinking about it as we had a slowdown in the second half of it, that means we still had an okay first half. And so just recognize that you get a full quarter's worth of impact on this now rather than just a month or 1.5 months of it.

我不會說得很具體。但是，是的，我會這麼說——因為如果你考慮一下我們下半場放緩的情況，這意味著我們上半場的表現仍然不錯。因此，您只需認識到，您現在就獲得了整個季度的影響，而不僅僅是一個月或 1.5 個月的影響。

And then within the Medical space. I mean, I think Sunny has already touched on a little bit about CT demand continues on. The radiographic detectors and kind of the products that are used for doing some basic chest X-ray kind f imaging. That demand is still there. So I mean I think -- and it's more about the additional capital equipment purchases for higher-end applications that we've seen a bit of a slowdown in the latter part of March and going into the next quarter.

然後是醫療領域。我的意思是，我認為 Sunny 已經談到了一些有關 CT 需求持續成長的問題。用於進行一些基本胸部 X 光成像的放射線偵測器和產品類型。這種需求仍然存在。所以我的意思是我認為 - 這更多的是關於高端應用程式的額外資本設備購買，我們在 3 月下旬和進入下一個季度看到了一些放緩。

Right. And then just in terms of just not to look back too much, but in terms of the Q2 performance because it probably were -- like you said, an increasingly more challenging world. But in terms of the margin, the impact on mix, was that mostly just the drop, as you mentioned, on the Industrial side? Because I would think that in the Medical side, at least some of these -- the CT machines, I know you have pretty good margin on right in the tubes, right? So...

正確的。然後就不要過多回顧，而是就第二季度的表現而言，因為就像您所說的那樣，這可能是一個越來越具有挑戰性的世界。但就利潤率而言，對組合的影響，正如您所提到的，主要是工業方面的下降嗎？因為我認為在醫療方面，至少其中一些——CT 機，我知道你們在管子方面有相當好的利潤，對吧？所以...

Yes. Larry, I'm glad you asked that because I looked at it as kind of in a little bit more -- maybe a little bit more macro in terms of -- we ended up at 32% as our gross margin. We've been targeting for the year to be 35%, which was comparable with a year ago or the prior year. And so 3 points of lost margin is a pretty significant movement for us. And I'd break it down roughly 1/3, 1/3, 1/3 into 3 categories. The first of it is overall mix, whether it's between segments, or even the mix of the products that we are selling. We're just selling less of the high-end products in the second quarter than we historically have. The second -- and we haven't really touched on this yet, but we still have -- particularly when you're comparing with prior year, we still have the overlap costs associated with the Santa Clara transfer. So we have some stranded overhead in Santa Clara, and we are ramping up production and support costs in Salt Lake City in preparation for the transfer. So that's roughly 1 point of impact as well. And then let's not lose sight of that COVID by itself caused some impact on us in terms of higher freight costs and just kind of less good productivity in the factories. We're just not as efficient as we were before. And so we saw roughly a point of impact associated with that as well. Freight, by the way, is certainly a challenge, and I would say that you see this with other companies as well is as the freight costs have gone up as there's restrictions on the number of ships that are available or airplanes that are available and freight costs have gone -- have increased.

是的。拉里，我很高興你問這個問題，因為我從更宏觀的角度來看待它，我們最終的毛利率為 32%。我們今年的目標是 35%，與一年前或前一年相當。因此，利潤損失 3 個百分點對我們來說是一個相當重大的變動。我大致分為 1/3、1/3、1/3 3 類。首先是整體組合，無論是細分市場之間，或是我們銷售的產品的組合。我們只是在第二季銷售的高端產品比歷史上少了。第二個——我們還沒有真正觸及這一點，但我們仍然有——特別是當你與前一年進行比較時，我們仍然有與聖克拉拉轉會相關的重疊成本。因此，我們在聖克拉拉有一些滯留的管理費用，我們正在增加鹽湖城的生產和支援成本，為轉移做準備。所以這也大約是 1 個影響點。然後，我們不要忽視新冠肺炎本身對我們造成的一些影響，包括貨運成本上升和工廠生產力下降。我們只是沒有以前那麼有效率了。因此，我們也大致看到了與此相關的影響點。順便說一句，貨運肯定是一個挑戰，我想說，您在其他公司也看到了這一點，因為貨運成本上升，因為可用船舶或可用飛機的數量和貨運受到限製成本已經消失——已經增加。

Can I ask you how much that impacted your gross margin? And also maybe on the operating side, on your SG&A side. Your SG&A seemed a little higher than I thought it would be. I know you called out the $3 million of increased consulting fees. So I guess a couple of questions there. Is that the new accounting standard? Is that more of a one-timer just this quarter? Is that going to leak into next quarter? And even if I take that out, costs were still, I think, close to 15% of a decent revenue number, even though the mix was down, the revenue number itself on absolute basis was okay. So trying to figure out -- decipher if there was anything else in there, maybe some COVID-related stuff.

我可以問一下這對你們的毛利率影響有多大嗎？也可能是在營運方面，在SG&A 方面。你們的 SG&A 似乎比我想像的要高。我知道您要求增加 300 萬美元的諮詢費用。所以我想有幾個問題。這是新會計準則嗎？這個季度這更像是一次性的嗎？這會滲透到下個季度嗎？即使我把這個去掉，我認為成本仍然接近體面收入數字的 15%，儘管組合有所下降，但收入數字本身在絕對基礎上還不錯。所以試著弄清楚——破解裡面是否還有其他東西，也許是一些與新冠病毒相關的東西。

Let me kind of run through kind of the different elements of that. And I would put it, first of all, as far as the added consulting costs to do the new accounting standard, most of that was associated with an accounting standard that was implemented in combination of Q1 and that bled over a little bit into Q2. So we have that. That's probably I talk about $3 million, and that's probably at least $2 million of it is associated with that. We also -- if you remember, we've said the SOx remediation costs, we used to non-GAAP that out. We have now started to include that in our adjusted earnings our adjusted financials. So there's some additional cost associated with that, that historically has been adjusted out from a non-GAAP adjustments perspective. And then you're right, I think that in general, just a little bit of less good performance in terms of the overall business because of COVID. But I have a hard time putting a lot of that into the SG&A bucket. So I didn't incur a whole lot of extra costs associated with COVID. It is more that we just haven't been operating as efficiently as we would normally like to. So.

讓我大致介紹一下其中的不同要素。我想說，首先，就執行新會計準則所增加的諮詢成本而言，其中大部分與第一季結合實施的會計準則有關，並在第二季度有所滲透。所以我們就有了。我所說的可能是 300 萬美元，其中可能至少有 200 萬美元與此相關。如果您還記得的話，我們也說過 SOx 補救成本，我們過去常常按照非公認會計準則計算出來。我們現在已經開始將其納入調整後的收益和調整後的財務數據中。因此，存在一些與此相關的額外成本，歷史上這些成本已從非公認會計原則調整的角度進行了調整。然後你是對的，我認為總的來說，由於新冠疫情，整體業務的表現略有下降。但我很難將其中大部分放入 SG&A 桶中。所以我沒有承擔與新冠病毒相關的大量額外費用。更重要的是，我們的營運效率並沒有像我們通常希望的那樣高。所以。

I missed one other point, which is the -- and particularly, when we're doing a comparison with prior year. We did have the addition of Direct Conversion, which adds mostly on the R&D line, but it does add some additional costs on SG&A as well. And we're not generating revenues yet with Direct Conversion. So there's a bit of a, let's call it, investment in that business going on right now that still impacts us from SG&A as a percentage of revenue perspective.

我還錯過了另一點，特別是當我們與前一年進行比較時。我們確實增加了直接轉換，這主要增加了研發線，但它也增加了 SG&A 的一些額外成本。而且我們還沒有透過直接轉換產生收入。因此，目前對該業務的一些投資（我們稱之為）仍然對我們的銷售管理費用（SG&A）佔收入的百分比產生影響。

Longer selling cycle, I guess. Just last question, I guess. And Sunny kind of touched on, hopefully, a lot of this stuff is temporary or even if it comes back next year, hopefully, in a couple of years, where it's pretty much under control. I guess my question is, a lot of your stuff on the Medical side, a lot of your purchases are -- a lot of it's driven by high-end CT machines and stuff. And if these hospitals, even if elective surgeries, they'll come back, but maybe not quite to the part that -- where they were. And in the meantime, can get from A to B, maybe some of these hospitals, their funding is a lot lower. So is there a possibility where the economic impact in the maybe the direct impact of slowdown, elective surgeries lead to slower equipment sales for an extended period that would impact your OEMs. And then you guys?

我猜銷售週期更長。我想只是最後一個問題。桑尼談到，希望很多這樣的事情都是暫時的，或者即使明年它會回來，希望在幾年內，它幾乎得到控制。我想我的問題是，你們在醫療方面的很多東西，你們的許多採購都是——很多是由高端 CT 機器和東西驅動的。如果這些醫院，即使是選擇性手術，他們也會回來，但可能不會完全回到原來的狀態。而同時，可以從A地到達B地，也許其中一些醫院，他們的經費要低很多。那麼，是否有可能經濟放緩的直接影響，選擇性手術導致設備銷售長期放緩，從而影響您的原始設備製造商。然後你們呢？

I'm going to give an initial response, and then I want Sunny to answer that more because I think he has a better finger on the pulse of that. I would say that the question was a little bit about what will happen with hospital economics. And I think that's an interesting question because I -- from what I'm reading and kind of what I'm hearing a little bit is, is that there's a lot of more interest in making sure that hospitals are viable and hospitals are properly funded and the like to ensure that they are functioning well. So I'm not sure I agree with your premise that you think that they will all have -- that they'll be struggling more in the future. I think that there's a commitment by governments to make sure that hospitals function well. Sunny?

我將給出一個初步的回應，然後我希望 Sunny 能更多地回答這個問題，因為我認為他能更好地掌握這個問題。我想說這個問題有點關於醫院經濟學將會發生什麼事。我認為這是一個有趣的問題，因為從我所讀到的內容和我所聽到的一點來看，人們對確保醫院的生存能力和醫院獲得適當的資金更加感興趣等等，以確保它們正常運行。所以我不確定我是否同意你的前提，即你認為他們都會有——他們將來會更加掙扎。我認為政府承諾確保醫院運作良好。陽光明媚？

Yes. No. It's not a premise. I just wanted to hear -- I'm just trying to play devil's advocate, and that it's a theory that they will be struggling, but I appreciate your thoughts. So.

是的。不，這不是前提。我只是想聽聽看——我只是想唱反調，理論上他們會陷入困境，但我很欣賞你的想法。所以。

Yes.

是的。

Larry, I think that your theory, I think, translates into a timing uncertainty, and that's why we're not -- because we can't put a finger on the specific timing of recovery, we're withdrawing guidance. But fundamentally, if you think about it, let's take oncology as an example, demand for cancer treatment. We just don't see that diminishing. So things like oncology, mammography, dental procedures, these are going to come back because of basic demographic drivers that will continue to be there.

拉里，我認為你的理論轉化為時間不確定性，這就是我們不這樣做的原因 - 因為我們無法確定具體的復甦時間，所以我們正在撤回指導。但從根本上來說，如果你想一想，讓我們以腫瘤學為例，對癌症治療的需求。我們只是沒有看到這種情況正在減少。因此，由於基本的人口驅動因素將繼續存在，諸如腫瘤學、乳房X光檢查、牙科手術之類的事情將會回歸。

And the question is: Will we see a faster return on the ambulatory or versus the hospital? We just don't know those.

問題是：與醫院相比，我們會看到門診或醫院的回報更快嗎？我們只是不知道這些。

Secondly, a pretty significant portion of our revenues on the tube side are replacement tubes. So as hospitals come back online as CT systems continue to function as that demand comes back. There was some of that demand that slowed down as well when just things -- surgery stopped getting done. So we're more -- we're bullish that the fundamental market drivers will then bring the systems -- the demand side back online, and the timing is what we're not placing a bet on.

其次，我們在電子管方面的收入的相當大一部分是替換電子管。因此，隨著醫院恢復上線，CT 系統隨著需求的恢復而持續發揮作用。當手術停止完成時，一些需求也會放緩。因此，我們更看好基本的市場驅動因素將使系統需求方重新上線，而時機是我們不下注的。

Our next question comes from the line of Suraj Kalia with Oppenheimer.

我們的下一個問題來自蘇拉吉·卡利亞（Suraj Kalia）和奧本海默（Oppenheimer）的對話。

Can you hear me all right?

你聽得到我說話嗎？

Yes.

是的。

Okay. So Sunny, and Clarence, let me just kind of dance around between some questions. Sunny, one of the things that most of the companies in our universe, albeit these are correlated to procedures in hospitals, and the hospital shutdown obviously has a collateral impact, most of the companies that we know of have been telegraphing, look, April volumes were down anywhere from 50% to 85%. Now obviously, you guys' business is a little different, not only from Medical and an Industrial perspective, but just sort of the visibility you have in demand, ordering patterns. I'm not sure I heard any specific numbers on how you saw April, maybe early May shape up. Could you all give us some color that this is where -- or maybe even oil and gas, this was where it was down this March and relative to what you'll normally see pre-COVID?

好的。桑尼和克拉倫斯，讓我在一些問題之間跳來跳去。陽光明媚，我們宇宙中大多數公司的事情之一，儘管這些與醫院的程序相關，而且醫院關閉顯然會產生附帶影響，但我們所知道的大多數公司都在發電報，看，四月份的捲下降了50% 到85%。現在顯然，你們的業務有點不同，不僅從醫療和工業的角度來看，而且只是從需求和訂購模式的可見性方面來看。我不確定我是否聽到任何關於您對四月（也許是五月初）的看法的具體數字。你們能給我們一些資訊嗎？甚至是石油和天然氣，這就是今年三月的下跌情況，以及相對於新冠疫情之前通常會看到的情況？

Well, Suraj, I think I talked a little bit with Anthony about this, which is just -- I would say that the Industrial side of the business is -- we saw the slowdown of that start in the second -- or the middle part of the second quarter. And now we expect to see a full quarter's worth of that decline. So you can little bit do the math around that in terms of extrapolating what a half a quarter's decline is versus a full quarter decline. I got to probably give very specific numbers somewhat because we still do our business pretty much without a lot of backlog. And so it's a lot of orders as they come in and then we ship and deliver to that demand.

好吧，蘇拉吉，我想我和安東尼談了一些關於這個問題，我想說的是，工業方面的業務是，我們看到了第二階段開始的放緩，或者說中間部分第二季度。現在我們預計會看到整個季度的下降。因此，您可以圍繞這一點進行數學計算，推斷出半個季度的下降與整個季度下降的情況。我可能必須給出非常具體的數字，因為我們仍然在幾乎沒有大量積壓的情況下開展業務。因此，有很多訂單進來，然後我們根據需求發貨和交付。

Got it. Okay. Sunny, in terms of -- again, how should we think about contractual minimums, if any? What offsets are there you guys are going to get impacted, right? Everyone is getting impacted. But how should we think about any contractual minimums during -- over the next, let's say, 3 quarters to tie this calendar year? That could give us some perspective of, okay, here is the counterbalancing effect despite some slowdown, let's say, in oil and gas.

知道了。好的。陽光明媚，再次，我們應該如何考慮合約最低限度（如果有的話）？你們會受到哪些補償影響，對吧？每個人都受到影響。但是，我們應該如何考慮在接下來的三個季度內（比方說，與本日曆年相關的三個季度）的任何合約最低限額？這可以給我們一些視角，好吧，儘管石油和天然氣行業有所放緩，但這是平衡效應。

So Suraj, I think we've said this before that our agreements with our customers are pricing agreements and the prices are volume-driven. So there are really no -- with a few exceptions, where we may have done special projects and -- but generally speaking, there are no real hard and fast contractual minimums. These are mostly -- if volumes are down, then next year, when we sit down to talk about prices and/or sit down with our customers, we'll have a discussion around pricing. But largely speaking, customers don't take more than what they need. And if they take more than what they need, the next quarter, we have -- they take less. And so you're not going to see an impact of that from us. We don't have any significant adjustments because of any volume adjustments.

所以蘇拉傑，我想我們之前已經說過，我們與客戶的協議是定價協議，價格是由數量驅動的。因此，實際上沒有——除了少數例外，我們可能做了特殊的項目——但一般來說，沒有真正的硬性和快速的最低合約要求。這些主要是 - 如果銷量下降，那麼明年，當我們坐下來討論價格和/或與客戶坐下來時，我們將圍繞定價進行討論。但總的來說，顧客不會拿走超出他們需要的東西。如果他們拿的比他們需要的多，那麼下個季度，我們就會——他們拿的更少。所以你不會看到我們對此的影響。我們沒有因為任何數量調整而進行任何重大調整。

Fair enough. So no offsets. Okay. And Clarence, in terms of Santa Clara, any change in time lines and realizing -- is it still on track for calendar '21? Any additional color? Or have some things being delayed because of COVID?

很公平。所以沒有偏移。好的。克拉倫斯，就聖克拉拉而言，時間線有任何變化並意識到 - 日曆 '21 是否仍在按計劃進行？還有什麼額外的顏色嗎？還是有些事情因為新冠疫情而被延後？

No. Actually -- and first of all, I just want to say kudos to the team because there is a ton of work going on right now in terms of ramping up the capabilities to do that manufacturing of those detectors in Salt Lake City, building the initial production of those, having those go to our customers, having them validate that they perform well and that we're right in the midst of that right now. We will start to see the slowdown -- the ramp down of the Santa Clara operations at the end of this quarter and going into the fourth quarter. So we start to see some financial benefit in the fourth quarter of this fiscal year. So we have moved that in about a quarter from what we originally talked about. So instead of talking about end of the calendar year. Most of the production will have been stopped by the end of the fiscal year. So we pulled it in about 3 months from there. So it means that we fundamentally will get the full benefit of reducing those costs for all of fiscal year '21. And so pretty much on track. And I would say, I mean, there's lot of work to be done. There's always a few hiccups and learnings along the way, but I would say all in all, that they are on schedule.

不。實際上，首先，我只想向團隊表示敬意，因為目前正在進行大量工作，以提高鹽湖城探測器的製造能力，建立這些產品的初始生產，將其交給我們的客戶，讓他們驗證它們的性能良好，我們現在正處於其中。我們將開始看到經濟放緩——從本季末到第四季度，聖克拉拉業務量將逐漸減少。因此，我們開始在本財年第四季看到一些財務效益。因此，我們將其與最初討論的內容相比移動了大約四分之一。因此，不要談論日曆年末。到本財年末，大部分生產將停止。所以我們從那裡開始大約 3 個月就完成了。因此，這意味著我們將從根本上獲得整個 21 財年降低這些成本的全部好處。一切都步入正軌了。我想說，我的意思是，還有很多工作要做。一路上總會遇到一些問題和學習，但我想說的是，總而言之，它們都按計劃進行。

Fair enough. And final question, and I'll hop back in queue. Sunny, forgive me, I have just been jumping in between 2 calls. So as we map out the remaining quarters, would it be fair to say that the relative impact of the structural drop in demand, oil and gas and the CapEx spend thereof, is going to impact you guys more than on the Medical side of the COVID-related? Specifically more, I'm just trying to visualize how the Medical line item would map out on the pro forma models versus Industrials. Is it safe to say Industrials, we should pretty much factor in all the step down predominantly in the Industrial segment?

很公平。最後一個問題，我會跳回隊列。 Sunny，請原諒我，我剛剛插了兩通電話。因此，當我們規劃剩餘季度時，可以公平地說，需求、石油和天然氣及其資本支出的結構性下降的相對影響，對你們的影響將比對新冠疫情醫療方面的影響更大-有關的？具體來說，我只是想直觀地想像醫療產品線專案與工業產品在備考模型上的映射方式。可以肯定地說，工業領域，我們應該主要考慮工業領域的所有降級嗎？

Yes. Suraj, that's actually a pretty difficult question to answer, but let me see if I can frame it for you. The behavior in the Industrial segment is different by vertical. So as you know, we play in security as a vertical. Within security, we've got airport and you've got cargo. What's happening, and I'll go through examples of a few verticals so you can get your sort of a framework around this. If you look at the security vertical, airport security-related issues are tied to both. Volume. For us, it's tied to volume of passengers going through airports as more passengers go through airports, more systems are used and more demand for tubes, right? That's number one. That's COVID-related. Now our other customers in security that are in cargo-related security, there, yes, they've had some delays with the projects getting delayed. But there the demand comes from being able to pay for these. If these are in oil-producing countries, oil-based economies, then the projects move out. So it's a combination there within security. But mostly, this COVID-related stuff is temporary, and oil-related stuff will continue to -- we've seen this happen in the past. When oil prices go down, projects get delayed. Hopefully, the project funding will come back when the oil prices stabilize.

是的。 Suraj，這實際上是一個很難回答的問題，但讓我看看是否可以為您設計。工業領域的行為因垂直領域而異。如您所知，我們將安全作為一個垂直領域。在安全方面，我們有機場，你們有貨。發生了什麼，我將通過幾個垂直領域的範例，以便您可以圍繞此獲得某種框架。如果你看看安全垂直領域，你會發現機場安全相關問題與兩者息息相關。體積。對我們來說，它與通過機場的乘客量有關，因為更多的乘客通過機場，使用更多的系統，對管道的需求也更多，對嗎？這是第一名。這與新冠病毒有關。現在，我們的其他安全客戶都從事與貨物相關的安全工作，是的，他們因專案延遲而出現了一些延誤。但需求來自於有能力支付這些費用。如果這些項目位於石油生產國、石油經濟體，那麼這些項目就會轉移出去。所以這是安全方面的結合。但大多數情況下，與新冠病毒相關的事情是暫時的，而與石油相關的事情將繼續存在——我們過去已經看到這種情況發生。當油價下跌時，項目就會被推遲。希望油價穩定後專案資金能夠收回。

In other verticals, if you look at, let's say, verticals that are more broad-based manufacturing and consumer-facing. So the food inspection vertical or electronics inspection vertical. These are tied to COVID. And these are tied, and recovery there will be tied to consumer spending and when these factories open up and production starts, right?

在其他垂直領域，如果你看看基礎更廣泛的製造和麵向消費者的垂直領域。因此食品檢測垂直或電子檢測垂直。這些都與新冠病毒有關。這些都是相互連結的，那裡的復甦將與消費者支出以及這些工廠開業和生產開始時聯繫在一起，對嗎？

Then you've got verticals that are in the government sector like aerospace. There, we think we are optimistic that the government will continue to spend money according to their budgets. So there the -- that recovery is on a totally different track. It's based on government funding and government budgets. So every -- and oil and gas, where we were selling software detectors, tubes. That vertical is, again, tied to oil prices.

然後是政府部門的垂直產業，例如航空航天。在那裡，我們認為我們樂觀地認為政府將繼續根據預算花錢。因此，復甦處於完全不同的軌道上。它基於政府資助和政府預算。因此，在石油和天然氣領域，我們銷售軟體探測器、管道。這種垂直關係再次與油價有關。

So there isn't one single reason, so the recovery, we think, will be in Industrial will be staged. Some things will come on earlier as manufacturing, general manufacturing comes online and other verticals will start to resume their -- as they resume their operations, we'll see recovery. So full recovery time frame is hard to put a finger on.

因此，沒有單一的原因，因此我們認為，復甦將在工業領域上演。隨著製造業、一般製造業的上線以及其他垂直行業將開始恢復運營，一些事情將會更早發生——當他們恢復運營時，我們將看到復甦。因此，完全恢復的時間很難確定。

Our next question comes from the line of Mark Strouse with JPMorgan.

我們的下一個問題來自摩根大通的馬克‧斯特勞斯 (Mark Strouse)。

Yes. Just wanted to get a bit more color on the cost savings. When you talk about $15 million to $20 million in cost savings during the second half, is that versus prior plan? Is that a year-over-year number? Just any color there? And then also, how much of that would be in COGS versus OpEx?

是的。只是想在節省成本方面獲得更多的色彩。當您談論下半年節省 1500 萬至 2000 萬美元的成本時，這是否與之前的計劃相比？這是同比數字嗎？那裡有什麼顏色嗎？另外，其中 COGS 與 OpEx 的比例是多少？

I'll take a shot at that. So it's -- so Mark, it's -- it would be against our current run rate. So the first half run rate, you would say these are reductions that are happening against that current run rate. So that's probably the easiest way for you to model it. And a good portion of that is people-related kinds of expenses. So we kind of walked through -- Sunny walked through some of the different actions in terms of furloughs and salary reductions, et cetera. So those are going to be spread more in the R&D and SG&A lines because we are not impacting the direct labor in production. So you're going to see a heavier weighting of those people-related costs in the operating expenses than you would in the gross margin. At the same time, we're looking at some of our, let's call it, variable expenses inside of the manufacturing overhead and reducing some of those as well. So that's where we do see some benefit with that. And a subset of that is with the pull-in of the Santa Clara closure that -- we see that benefit mostly in the gross margin line, a little bit in the R&D line. So a bit of a mixed bag. I would say probably in the order of magnitude of 2/3 operating expense, 1/3 gross margin, very roughly speaking.

我會嘗試一下。所以，馬克，這將違背我們目前的運行速度。因此，上半年的運行率，你會說這些是針對當前運行率發生的減少。所以這可能是最簡單的建模方法。其中很大一部分是與人員相關的支出。所以我們經歷了——桑尼經歷了一些不同的行動，例如休假和減薪等等。因此，這些將更分佈在研發和銷售、一般管理費用方面，因為我們不會影響生產中的直接勞動力。因此，您會發現營運費用中與人員相關的成本所佔的權重比毛利率中的權重更大。同時，我們正在研究製造費用中的一些可變費用，並減少其中的一些費用。這就是我們確實看到的一些好處。其中一個子集是聖克拉拉關閉的拉動——我們看到這主要受益於毛利率線，一點點受益於研發線。所以有點魚龍混雜。我想說，大概是 2/3 營運費用、1/3 毛利率，非常粗略地說。

Okay. That's helpful, Clarence. And then I wanted to go back to your long-term gross margin targets. You've talked about expectations for the market to eventually recover. But are there any structural changes that you think come out of this that might impact that long-term target?

好的。這很有幫助，克拉倫斯。然後我想回到你們的長期毛利率目標。您談到了對市場最終復甦的預期。但您認為由此產生的任何結構性變化是否可能影響長期目標？

I -- well, I'm going to give you a little bit of the color from the finance guy, and then I think Sunny can give a little color kind of the broader-picture kinds of things. But as we learn through this process about how can we function with reduced cost structure, like the things that we just talked about here just a second ago, there's opportunities there that say these could be things that could continue on, maybe not so much the furloughs and the salary reductions, but more about some of the other operational costs and variable expenditures, et cetera. So that's a fundamental starting point. And then we're going to take a hard look at just our overall cost structure as we kind of look at our overhead expenses, some of our lower-performing product lines and say, should we -- what can we do to either discontinue those or get some level of price increase, those are the things that make a difference from a gross margin perspective.

我——好吧，我將從財務人員那裡給你一些信息，然後我認為桑尼可以給你一些更宏觀的信息。但是，當我們透過這個過程了解到如何以降低的成本結構運作時，就像我們剛才在這裡談論的事情一樣，有機會表明這些事情可能會繼續下去，也許不是那麼多休假和減薪，但更多的是其他一些營運成本和可變支出等等。這是一個基本的起點。然後，我們將仔細審視我們的整體成本結構，因為我們會審視我們的管理費用、我們的一些表現較差的產品線，並說，我們應該——我們能做些什麼來停止這些產品或獲得一定程度的價格上漲，這些都是從毛利率角度來看會產生影響的。

At the same time, we are -- we continue to invest on the right things in R&D with the -- we talk about the new Z Platform for detectors. That's a big deal for us. I mean that is one of those that will end up actually -- it's improving the performance of the product and has a good cost structure associated with it. So it does lead to some better performance in the detector side of the business with things like that.

同時，我們繼續在研發方面進行正確的投資，我們談論新的探測器 Z 平台。這對我們來說是一件大事。我的意思是，這實際上是最終的結果之一——它提高了產品的性能，並具有與之相關的良好成本結構。因此，它確實可以在檢測器方面帶來更好的性能。

Our next question comes from the line of Jim Sidoti with Sidoti & Company.

我們的下一個問題來自 Sidoti & Company 的 Jim Sidoti。

So just a couple of quick follow-ups. I just want to make sure I heard what you said. In China, are those manufacturing facilities up and running? And is that business back to where it was before COVID?

所以只需進行一些快速跟進。我只是想確保我聽到了你說的話。在中國，這些生產設施是否已建成並運作？該業務是否回到了新冠疫情爆發之前的水平？

Yes. It's -- Jim, this is Sunny. I'll take -- I'll start us. So China has recovered fairly quickly from at least from the COVID-related shutdowns that they had over a period. They came right back fairly rapidly on track. And so our CT projects, our factory projects, the production work, the starting up of our production, all of those has remained on track. We're producing detectors in China. We're shipping them in increasing quantities. We're making radiographic detectors, dental detectors, oncology detectors, all that -- our plans for China remain on track. So that's -- we're very happy about that.

是的。這是──吉姆，這是桑尼。我會——我會開始我們。因此，中國至少從一段時間內與新冠病毒相關的停工中恢復得相當快。他們很快就回到了正軌。因此，我們的 CT 項目、工廠項目、生產工作、生產啟動，所有這些都保持在正軌上。我們在中國生產探測器。我們正在增加運輸它們的數量。我們正在製造放射線探測器、牙科探測器、腫瘤探測器等等——我們在中國的計劃仍在按計劃進行。所以我們對此感到非常高興。

And then in addition, we have begun to move. We talked about moving some of our -- some portions of our supply chain and qualifying suppliers in China, those are also on track, and we're using those suppliers in our manufacturing activity that's going on in China right now.

另外，我們也開始行動了。我們談到了將我們供應鏈的一些部分和合格的供應商轉移到中國，這些供應商也正在按計劃進行，我們正在中國目前正在進行的製造活動中使用這些供應商。

Okay. And then in your other facilities worldwide, have you cut back on shifts? And can you tell us a percentage on how much you cut back?

好的。那麼，在你們全球的其他工廠中，你們是否減少了輪班時間？您能告訴我們您削減了多少百分比嗎？

No. Actually, we didn't. There was no cutting back on shifts, et cetera. The only place where we had challenges was in the Philippines. And there was a period of time when production staffing went down, dipped because of the transportation issues. We created dorms for our employees in the facilities. We housed them and -- we production -- we balanced production between geographies. and look, we talked about this in earlier quarters where we said we're distributing our production globally so that we can be more resilient, and that paid off despite pretty significant impact at a point in time in the Philippines, our on-time delivery of those products, high-volume products remained at greater than 99%. So we were able to balance between the Philippines and the Netherlands, added more shifts in the Netherlands and then moving back and added more shifts in the Philippines. We've been balancing labor and shifts, and we have been -- we have not faltered there. Same thing in Salt Lake City. We've been running at -- we're here running at historical capacity levels, and we were able to deliver major portions of the increased demand within the quarter.

不，事實上，我們沒有。沒有減少輪班等。我們唯一遇到挑戰的地方是菲律賓。有一段時間，由於運輸問題，生產人員配備減少。我們在設施中為員工創建了宿舍。我們安置它們，並且我們進行生產，我們平衡了不同地區的生產。你看，我們在前幾個季度談到這一點，我們表示我們正在全球範圍內分配生產，以便我們能夠更具彈性，儘管在菲律賓的某個時間點產生了相當大的影響，但我們的按時交貨還是得到了回報其中，大批量產品佔比保持在99%以上。因此，我們能夠在菲律賓和荷蘭之間取得平衡，在荷蘭增加更多班次，然後返回並在菲律賓增加更多班次。我們一直在平衡勞動力和輪班，而且我們一直在這方面沒有動搖。鹽湖城也有同樣的情況。我們一直在以歷史產能水準運行，並且我們能夠在本季度內滿足增加的需求的大部分。

And how about -- in the month of April, have you reduced shifts in the month of April?

那麼，在 4 月份，您是否減少了 4 月份的班次？

So Sunny, I think where Jim is going is there's a little bit about is if there's a slowdown in Industrial, where we slowed down a little bit of the production. And that would be a little bit in the linear accelerator production, for example, is probably the example of that.

所以桑尼，我認為吉姆要去的地方是工業是否會放緩，我們會放慢一點生產速度。例如，這可能是線性加速器生產中的一點點。

That's correct. And in our 2 production, even the -- those Industrial tubes, the linear accelerators are made -- that's a different product, but the regular X-ray tubes, Industrial tubes, Medical tubes are made in the same facilities and the labor there is fungible, the resources there are fungible. The production processes are shared. So that's the advantage of having both those together. We get the economies of scale.

這是正確的。在我們的 2 生產中，即使是那些工業管、直線加速器也是不同的產品，但常規 X 射線管、工業管、醫療管是在相同的設施中製造的，並且那裡的勞動力可替代，那裡的資源是可替代的。生產過程是共享的。這就是將兩者結合在一起的優勢。我們獲得了規模經濟。

Okay. All right. So even with the slowdown in Industrial, you haven't had to make drastic changes to your production? I mean, you're still operating the same shifts you were 3 months ago.

好的。好的。因此，即使工業成長放緩，您也不必對生產做出重大改變？我的意思是，你的班次仍然與三個月前相同。

Yes.

是的。

Yes.

是的。

Okay. And then the last question, Clarence, you talked about the gain you reported because of the final payment to fund the acquisition and the change in share price. I just want to make sure I understand. Have those shares already been issued? Or what should we think of from a share count for the rest of the year?

好的。最後一個問題，克拉倫斯，您談到了由於收購資金的最終付款和股價變化而報告的收益。我只是想確保我理解。這些股票已經發行了嗎？或者我們應該從今年剩餘時間的股票數量中得出什麼結論？

Yes. They got issued in April, and I'm going to go a little bit from memory here. I believe it's something like 300,000 shares. Something in that order of magnitude.

是的。它們是在四月發行的，我將在這裡憑記憶講一些內容。我相信大約有 30 萬股。在這個數量級的東西。

Okay. So you'll still be around that 39.5 million shares.

好的。所以你仍然持有 3950 萬股左右。

Yes. You'll get a little bit of dilution here. So that's -- I think we were at 39.1 million. So next quarter will be 39.4 million or 39.5 million, something like that.

是的。你會在這裡得到一點稀釋。所以我想我們的人數是 3910 萬。所以下個季度將是 3940 萬或 3950 萬，類似的數字。

Our next question is a follow-up question from Anthony Petrone.

我們的下一個問題是 Anthony Petrone 提出的後續問題。

Just one on the balance sheet and cash outlook. And I know that you called out cost reductions in the second half and you do have $30 million due in short-term debt. And you took out $65 million from the credit revolver. So just as you think of the cash outlook, specifically, I guess, looking into fiscal 3Q, it appears that there should be some level of a cash burn. Is there any color there? And as you sort of look into the fiscal 4Q and early next year, will the business be cash flow positive?

只有資產負債表和現金前景方面的一項。我知道你們呼籲下半年削減成本，而且你們確實有 3000 萬美元的短期債務到期。你從信用左輪手槍中取出了 6500 萬美元。因此，正如您考慮現金前景一樣，我想，特別是在第三季財報中，似乎應該存在一定程度的現金消耗。那裡有顏色嗎？當您展望第四財季和明年初時，該業務的現金流會為正嗎？

Yes. It's a topic that I spend a lot of time on these days and watching it very closely. Maybe just a little bit of color in terms of our debt is that we have a minimum payment that we make on the term loan. That's $7.5 million a quarter. So that's the minimum amount that we have to pay as far as debt payments in Q3 and in Q4.

是的。這是我這些天花了很多時間並非常仔細地關注的一個主題。也許就我們的債務而言，我們的定期貸款有最低還款額。即每季 750 萬美元。這是我們在第三季和第四季必須支付的債務支付的最低金額。

The good news about our business is that we're dealing with repeat customers that are substantial in their financial strength and that we're dealing with large entities that make their payments very timely. So we've not seen any changes in the customer payment patterns at this point in time, which is a big deal, okay? Because as we continue to monitor that there, they continue to pay very closely to their terms level. The key for us is all about -- as we see the shift in the mix of what customers are ordering from us, we have to adjust our manufacturing schedules, and we need to reduce inventory for the items that we've seen slowdown in. And so that's been the key focus for me. It is about making sure that we are not having to make payments outflows as such for a product that's just going to sit in inventory. So there's a lot of adjusting going on in terms of our build schedules and the corresponding purchases from suppliers. That's the main focus that we have.

關於我們業務的好消息是，我們正在與財務實力雄厚的回頭客打交道，我們正在與大型實體打交道，他們的付款非常及時。因此，目前我們還沒有看到客戶付款模式有任何變化，這是一件大事，好嗎？因為當我們繼續監控時，他們的付款仍然非常接近他們的條款水準。對我們來說，關鍵在於——當我們看到客戶向我們訂購的產品組合發生變化時，我們必須調整我們的製造計劃，並且我們需要減少我們已經看到放緩的商品的庫存。這就是我關注的重點。這是為了確保我們不必為庫存中的產品支付資金外流。因此，我們的建置計劃和相應的供應商採購方面正在進行大量調整。這是我們的主要關注點。

I would say that there's the obvious benefit that happens with reducing some of the expenses, which is what we talked about, the $15 million to $20 million. And then also the reduction of the CapEx spending is the other item that helps us keep cash flow positive for the second half. It's going to be tight. I'm going to tell you that. It's going to be tight, but I feel like we're in an okay spot.

我想說的是，減少一些開支會帶來明顯的好處，這就是我們所說的 1500 萬至 2000 萬美元。資本支出的減少也是幫助我們在下半年維持正向現金流的另一個因素。會很緊。我要告訴你的是。情況會很緊張，但我覺得我們處於一個不錯的位置。

There are no further questions in queue. I'd like to hand the call back to management for closing remarks.

隊列中沒有其他問題。我想將電話轉交給管理階層以供結束語。

Thank you for your questions and participating in our earnings conference call for the second quarter of fiscal year 2020. A replay of this quarterly conference call will be available through May 26 and can be accessed at the company's website or by calling (877) 660-6853 from anywhere in the U.S. or (201) 612-7415 from non-U.S. locations. The replay conference call access code is 13702421. Goodbye.

感謝您提出問題並參加我們的 2020 財年第二季度收益電話會議。本季度電話會議的重播將持續到 5 月 26 日，您可以透過公司網站或致電 (877) 660 進行訪問。美國任何地方請請撥6853，美國以外地區請撥(201) 612-7415。重播電話會議接入碼是13702421。再見。

Ladies and gentlemen, this does conclude today's teleconference. Thank you for your participation. You may disconnect your lines at this time, and have a wonderful day.

女士們、先生們，今天的電話會議到此結束。感謝您的參與。此時您可以斷開線路，度過美好的一天。

Thank you.

謝謝。

Goodbye.

再見。