Xpel Inc (XPEL) 2024 Q3 法說會逐字稿

Greetings. Welcome to the XPEL Incorporated third quarter 2024 earnings call. (Operator Instructions) Please note this conference is being recorded.

問候。歡迎參加 XPEL Incorporated 2024 年第三季財報電話會議。（操作員說明）請注意，本次會議正在錄製中。

I will now turn the conference over to your host, John Nesbett with IMS Investor Relations. Sir, you may begin.

現在我將把會議交給主持人 IMS 投資者關係部門的 John Nesbett。先生，您可以開始了。

Good morning, and welcome to our conference call to discuss XPEL's financial results for the third quarter of 2024.

早安，歡迎參加我們的電話會議，討論 XPEL 2024 年第三季的財務表現。

On the call today, Ryan Pape, XPEL's President and Chief Executive Officer; and Barry Wood, XPEL's Senior Vice President and Chief Financial Officer, will provide an overview of the business operations and review the company's financial results. Immediately after the prepared comments, we will take questions from our call participants.

XPEL 總裁兼執行長 Ryan Pape 出席了今天的電話會議； XPEL 高級副總裁兼財務長 Barry Wood 將概述業務營運情況並審查公司的財務表現。在準備好意見後，我們將立即回答電話會議參與者的問題。

I'll take a moment to read the safe harbor statement. During the course of this call, we will make certain forward-looking statements regarding XPEL and its business, which may include, but not limited to anticipated use of proceeds from capital transactions, expansion into new markets and execution of the company's growth strategy.

我將花點時間閱讀安全港聲明。在本次電話會議期間，我們將做出有關 XPEL 及其業務的某些前瞻性聲明，其中可能包括但不限於資本交易收益的預期用途、新市場的擴張以及公司成長策略的執行。

Such statements are based on our current expectations and assumptions, which are subject to known and unknown risk factors and uncertainties that could cause actual results to be materially different from those expressed in these statements.

此類陳述基於我們目前的預期和假設，這些預期和假設受到已知和未知的風險因素和不確定性的影響，可能導致實際結果與這些陳述中表達的結果有重大差異。

Some of these factors are discussed in detail in our most recent Form 10-K, including under Item 1A Risk Factors filed with the SEC. XPEL undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

其中一些因素在我們最新的 10-K 表格中進行了詳細討論，包括向 SEC 提交的第 1A 項風險因素。XPEL 不承擔公開更新或修改任何前瞻性聲明的義務，無論是由於新資訊、未來事件或其他原因。

With that, I will now turn the call over to Ryan. Please go ahead, Ryan.

現在，我將把電話轉給瑞安。請繼續，瑞安。

Thanks, John, and good morning as well, everyone. Welcome to our third quarter conference call.

謝謝約翰，大家早安。歡迎參加我們的第三季電話會議。

We saw good top and bottom line performance for the quarter. Revenue growing 9.9% to $112.9 million, which is a record high for us. Excluding China, total revenue grew 12.3%. We saw some modest leverage in the quarter. EBITDA growing just slightly faster than revenue, which is good to see and something to expand on, obviously. Our US business turned in another good quarter, revenue growing 9.4% to $64.6 million. And this along with Q2, they were really our highest US revenue quarters in history, very close to each other.

我們看到本季的頂線和底線表現良好。營收成長 9.9% 至 1.129 億美元，創歷史新高。不包括中國，總收入成長12.3%。我們在本季度看到了一些適度的槓桿率。EBITDA 的成長速度略快於收入的成長速度，這是一件好事，而且顯然是值得擴大的。我們的美國業務又迎來了一個良好的季度，營收成長 9.4% 至 6,460 萬美元。這與第二季度一起，確實是我們歷史上美國收入最高的季度，彼此非常接近。

We continued to see some growth in the independent channel. Dealership services and OEM performed relatively well, which is good. I think a good result in this environment where we've seen impact from consumer discretionary spending being challenged in our opinion.

我們繼續看到獨立管道的一些成長。經銷商服務和OEM 表現相對較好，這是好事。我認為在這種環境下，我們看到消費者可自由支配支出的影響受到挑戰，這是一個很好的結果。

As you recall, US business has some bell curve like cyclicality or seasonality. So, Q4 for the US will be lower than sort of the Q2, Q3 highs in revenue, which it typically is. But I think good momentum and expect similar growth rates in the US for the fourth quarter like we saw this quarter.

您還記得嗎，美國企業有一些鐘形曲線，例如週期性或季節性。因此，美國第四季的營收將低於第二季、第三季的營收高點（通常情況下）。但我認為勢頭良好，預計美國第四季的成長率與本季類似。

Canada grew 25.7%. So, a really good result there. A little bit of benefit from timing, but overall a solid result. And I think this kind of epitomizes sort of a little bit of the choppy nature of what we're seeing this year. In Latin America, Asia Pacific, which excludes China and Middle East, continued to show strong growth in the quarter. These markets are less mature.

加拿大成長了25.7%。所以，這是一個非常好的結果。時間安排上有一點好處，但整體來說結果不錯。我認為這集中體現了我們今年所看到的波動性。在拉丁美洲，不包括中國和中東的亞太地區本季持續呈現強勁成長。這些市場還不太成熟。

So we expect more growth, and most of that is through our indirect or distribution channel as opposed to direct sales. And as we've said before, internationally, we will continue to move to a more direct model over time focused on the top car markets of the world where we think our presence would be helpful.

因此，我們預計會有更多成長，其中大部分是透過我們的間接或分銷管道而不是直接銷售。正如我們之前所說，在國際上，隨著時間的推移，我們將繼續轉向更直接的模式，重點關注我們認為我們的存在將會有所幫助的世界頂級汽車市場。

To that end, as we talked about previously, we closed on the acquisition of our distributor in India in August and that aligned with our own operation that we have been setting up this year and then our distributor in Japan, which we have just recently acquired.

為此，正如我們之前談到的，我們在八月完成了對印度經銷商的收購，這與我們今年建立的自己的業務以及我們最近剛收購的日本經銷商相一致。

Like our previous distributor acquisitions, attractive multiples, sort of 3 times to 4 times EBITDA, both of the acquisitions accretive. But really more importantly, they provide us the ability to grow the business faster and then the optionality to apply any or all of our products and services into a given market.

就像我們之前的經銷商收購一樣，倍數頗具吸引力，大約是 EBITDA 的 3 到 4 倍，兩次收購都帶來了增值。但更重要的是，它們使我們能夠更快地發展業務，然後可以選擇將我們的任何或所有產品和服務應用到特定市場。

So I think we really happy to add Japan. This is a market for us by any metric relative to the other countries in which we operate that has underperformed significantly for years, and this is a good way to be able to invest and drive that forward. So, very happy to finally get that done.

所以我認為我們很高興加入日本。對我們來說，無論從任何標準來看，與我們開展業務的其他國家相比，這個市場多年來都表現不佳，而這是一個能夠投資並推動這一發展的好方法。所以，很高興終於完成了這件事。

We did see slower growth than what we've been seeing in Europe and UK. It seems to be attributable to some of these macro headwinds. Hard to say exactly what's driving. But I think the Q3 in these markets felt a little bit like Q1 did in the US in terms of sentiment. So something to watch and keep working on.

我們確實看到成長速度比歐洲和英國慢。這似乎可歸因於其中一些宏觀阻力。很難說到底是什麼在驅動。但我認為這些市場第三季的情緒有點像美國第一季的情況。所以值得關注並繼續努力。

In China, revenue came in at $9.1 million, which was higher than the total -- the first six months of this year. It was a decline of just under 12% quarter-over-quarter. But with respect to China, I think we have good news to report in our efforts to streamline our processes, supply chain and inventory management. We're now at a point where we believe the swings in the sell-in dynamic are past us.

在中國，收入為 910 萬美元，高於今年前六個月的總收入。環比下降略低於 12%。但就中國而言，我認為我們在簡化流程、供應鏈和庫存管理方面有好消息要報告。我們現在相信銷售動態的波動已經過去了。

As of today, we see a current run rate of approximately $8 million to $9 million per quarter, nominally less in Q1 due to Chinese New Year. So if you think about that in a sense, it's a $9 million we had for Q3, call it, $8 million to $9 million for Q4, a little bit less than that, maybe $7 million to $8 million in Q1 and then $8 million to $9 million in Q2 as an example of how that plays out.

截至今天，我們看到目前每季的營運費用約為 800 萬至 900 萬美元，由於農曆新年，第一季的營運費用名義上有所減少。因此，如果你從某種意義上考慮一下，我們第三季的資金為900 萬美元，第四季為800 萬至900 萬美元，比這個少一點，第一季可能為700 萬至800 萬美元，然後是800 萬美元。

Our total demand is still actually higher than that as we have some SKUs that we will be discontinuing as part of all this work we've been doing. So the sell-through in China remains of those SKUs, but they will not be replenished.

我們的總需求實際上仍然高於這個數字，因為作為我們一直在做的所有工作的一部分，我們將停止一些 SKU。因此，這些 SKU 在中國的銷售仍然存在，但不會補充。

So that's further upside in the second half of next year once those are sold through. But we expect anything and everything that replaces them to be sold in ratably using the new processes and what we've been working on this year.

因此，一旦這些產品售完，明年下半年的價格將進一步上漲。但我們希望使用新流程以及我們今年一直在做的工作來取代它們的任何東西都能以可觀的價格出售。

So while that means we'll see year-over-year decline for the fourth quarter in China compared to Q4 of last year, which was our highest revenue ever, we'll see substantial year-over-year gains in the first half of next year where sales were quite low and then this predictable cadence going forward.

因此，儘管這意味著與去年第四季（這是我們有史以來最高的收入）相比，我們將看到第四季度在中國的同比下降，但我們將看到上半年的同比大幅增長明年的銷售額相當低，然後這種可預測的節奏繼續下去。

So I want to thank, everybody, on our team involved, both those in our centralized functions and then the team in Asia for working really hard to implement all these changes over the past 12 months. It's going to make a big difference certainly in terms of how you see the results, but there's a lot more to it to increase our competitiveness and then give us a platform to drive more growth.

因此，我要感謝我們團隊中參與的每個人，包括我們集中職能部門的人員以及亞洲團隊，感謝他們在過去 12 個月中為實施所有這些變革而付出的努力。就您如何看待結果而言，這肯定會產生很大的影響，但它還可以提高我們的競爭力，然後為我們提供一個推動更多成長的平台。

Additionally, we made a focus to pursue OEM and 4S opportunities in China this year. We've recently won two small contracts, have more in queue. So, we have interest also from some of our existing OEM partners regarding future projects in China and along with other markets like Japan and India.

此外，今年我們也專注於尋求在中國的 OEM 和 4S 機會。我們最近贏得了兩份小合同，還有更多合約正在等待中。因此，我們的一些現有 OEM 合作夥伴也對中國以及日本和印度等其他市場的未來項目感興趣。

So you can see the connectivity to our broader strategy here. Like we talked about, these projects have a longer sales cycle, but certainly, in the case of China, that's further upside possible for next year.

因此，您可以在這裡看到與我們更廣泛的策略的連結。正如我們所說，這些項目的銷售週期較長，但就中國而言，明年的銷售週期肯定有進一步的上升空間。

And finally, we've been conducting a strategic review of the go-to-market in China, separate from these efforts to streamline the supply chain and inventory planning. But we've been conducting a strategic review of the go-to-market in China compared to the other markets where we own our own distribution, which, as you know, and based on what I just said, that's our preferred approach for a number of reasons.

最後，除了簡化供應鏈和庫存規劃的努力之外，我們也一直在對中國市場的進入進行策略性審查。但與我們擁有自己分銷的其他市場相比，我們一直在對中國市場的進入進行戰略審查，正如你所知，根據我剛才所說的，這是我們的首選方法原因的數量。

So we're pretty advanced in this process, and we expect this review to be concluded soon, and then we'll act accordingly based on what that tells us. So, I think a lot of good work there by the team, and I think it's starting to pay dividends. And if you look at some of the strategic initiatives we have, which is really, first, managing our inventory, cash flow conversion to drive free cash flow, which we've done a pretty good job on or pretty advanced in.

因此，我們在這個過程中已經取得了相當大的進展，我們預計這次審查很快就會結束，然後我們將根據審查結果採取相應行動。所以，我認為團隊做了很多出色的工作，我認為它已經開始帶來回報。如果你看我們的一些策略性舉措，首先是管理我們的庫存、現金流轉換以推動自由現金流，我們在這方面做得非常好或相當先進。

Second was really with China and getting the distribution, and the sell-in, sell-through and supply chain dynamics sorted, which I think we're well on track. And then we'll certainly be focused after that on the overall operating performance of the business and what we need to do to drive further operating leverage over time.

其次是與中國的合作，對分銷、銷售、銷售和供應鏈動態進行排序，我認為我們已經步入正軌。然後我們肯定會關注業務的整體營運績效以及我們需要採取哪些措施來隨著時間的推移進一步推動營運槓桿。

So all in all, I think making progress on our core priorities even in a somewhat more challenging environment, obviously, than a year ago. So with that backdrop, we expect Q4 revenue probably $105 million to $107 million range -- $107 million range.

總而言之，我認為即使在比一年前更具挑戰性的環境中，我們的核心優先事項也取得了進展。因此，在這種背景下，我們預計第四季的營收可能在 1.05 億美元至 1.07 億美元之間——1.07 億美元的範圍內。

That assumes continued solid growth in the US like we've seen in rest of world and then, obviously, substantially lower sales in China pursuant to the changes in strategy I just outlined. So, I think overall, very happy with that, and we'll look forward to next year and the predictability that, that gives us. So really great job by the team here.

這是假設美國將像我們在世界其他地區看到的那樣持續穩健增長，然後，根據我剛才概述的戰略變化，中國的銷售額顯然會大幅下降。所以，我認為總的來說，對此非常滿意，我們將期待明年以及它給我們帶來的可預測性。這裡的團隊做得非常出色。

Gross margin for the quarter finished at 42.5%. That was down 100 basis points from Q2, a little bit of China mix impact there. But this is probably a pretty good run rate for us as we close out the year, maybe nominally less, but should be right there. SG&A expenses grew 23.6% over Q3 2023.

該季度毛利率為 42.5%。這比第二季度下降了 100 個基點，這受到了中國混合因素的影響。但這對我們來說可能是一個相當不錯的運行率，因為我們今年即將結束，名義上可能會更少，但應該就在那裡。SG&A 支出較 2023 年第三季成長 23.6%。

As we previously discussed, we've ramped SG&A up over the past few years in a variety of different areas, which we talked about, and that was really especially biased last year in Q3 and then in Q4 and then coming into this year, worked to constrain those increases much more substantially.

正如我們之前所討論的，我們在過去幾年中在各個不同領域提高了 SG&A，我們談到了這一點，去年第三季度、第四季度、然後進入今年，這確實特別有偏差，奏效了更大幅度地限制這些成長。

So we are lapping some of those expenses now and as we get through Q4. So, that's good or some of the expense increases rather. Saw modest leverage in the quarter. We expect that to continue. And as I mentioned a minute ago, that's certainly going to be a focus of ours as we work through some of these other initiatives.

因此，當我們進入第四季度時，我們現在正在考慮其中一些費用。所以，這是好事，否則一些費用反而會增加。本季槓桿比率適度。我們預計這種情況會持續下去。正如我剛才提到的，當我們進行其他一些舉措時，這肯定會成為我們的重點。

On the product front, we launched our Windshield Protection Film at the annual SEMA trade show this week, had good feedback. This has been a top requested product at the consumer level, sort of the man on the street level. And we're eager to see if we can make this a gateway product for consumers that we wouldn't connect with otherwise.

在產品方面，我們在本週的年度SEMA貿易展上推出了擋風玻璃保護膜，獲得了良好的回饋。這是消費者層面（即街頭人士層面）最需要的產品。我們很想知道是否可以將其打造成我們無法接觸到的消費者的門戶產品。

So if you imagine consumers that don't know about the rest of our product set or perhaps aren't interested in it or don't think they're interested in it, this is another way if we can reach them with this product to sort of bring them into the fold. So, we'll find out over the next year how effective we can be in doing that. Don't expect it to have a meaningful impact on 2024 revenue as we're just launching it. But certainly, that will be more impact for 2025.

因此，如果您想像消費者不了解我們的其他產品，或者可能對此不感興趣，或者認為他們對此不感興趣，那麼如果我們可以透過此產品吸引他們，這是另一種方式有點把他們納入其中。因此，我們將在明年發現我們在這方面的效率如何。由於我們剛剛推出，因此不要指望它會對 2024 年的收入產生重大影響。但可以肯定的是，這對 2025 年的影響將會更大。

Additionally, on the product side, we still plan our soft launch of the color change films in the first part of 2025, likely in the first quarter. So, looking forward to that as well. Regarding our OEM business, we continue to see interest here in programs -- a variety of programs in multiple geographies.

此外，在產品方面，我們仍計劃在 2025 年上半年（可能是第一季）試推出變色膜。所以，對此也充滿期待。關於我們的 OEM 業務，我們繼續看到人們對專案感興趣——多個地區的各種專案。

As we talked about on our last call, we launched an initial referral program, collaboration with Tesla, where customers in the US can purchase services from us online and then they are sent to the local installer near them for the installation.

正如我們在上次電話中談到的那樣，我們啟動了一項與特斯拉合作的初步推薦計劃，美國的客戶可以在線向我們購買服務，然後將他們發送到附近的本地安裝人員進行安裝。

So, we're taking an offline transaction and bringing it online and using the marketing heft of who we're collaborating with to really drive sales. And we think it's a novel approach to this industry. We've been doing this in a small scale, having good results, and we continue to iterate and optimize it. And we see others interested in this.

因此，我們正在將線下交易轉移到線上，並利用我們合作夥伴的行銷力量來真正推動銷售。我們認為這是該行業的一種新穎方法。我們一直在小規模地做這件事，取得了不錯的效果，並且還在不斷迭代和優化。我們看到其他人對此感興趣。

And again, this is a way to further increase the visibility of these products beyond the core enthusiast customer that knows us, when you consider many, many makes of vehicle where we're touching a very small single-digit percentage of them today. So how can we increase that? So, happy with how that's progressing.

再說一遍，這是一種進一步提高這些產品的知名度的方法，超出了了解我們的核心發燒友客戶的範圍，當你考慮到許多很多品牌的車輛時，我們今天接觸的產品比例非常小。那我們要怎麼增加它呢？所以，對進展感到滿意。

We had a solid cash flow quarter, generated $19.6 million. That was good, starting to see -- starting to build cash and certainly working through how best to deploy that capital, as we've talked about. In addition to sort of the distributor opportunities that we mentioned and that we might consider, we're continuing to pursue a larger expansion into services and products for the dealership space.

我們的季度現金流強勁，產生了 1,960 萬美元。這很好，開始看到——開始累積現金，當然還要研究如何最好地部署這些資本，正如我們所討論的。除了我們所提到的和我們可能考慮的經銷商機會之外，我們還將繼續尋求更大程度地擴展經銷商領域的服務和產品。

We have a team engaged on this endeavor. We've done a lot of work on it, and making good progress with that strategy. And I think this remains our favored capital allocation strategy based on a couple of things, the valuations that we see of potential opportunities, the TAM expansion these strategies give our overall business and then the expansion and adoption of our core products that they will lead to. So, we think that's pretty compelling. And I expect to talk about that next year and as we get into next year, but a lot of effort ongoing with that.

我們有一個團隊致力於這項工作。我們已經在這方面做了很多工作，並且在該策略方面取得了良好進展。我認為這仍然是我們青睞的資本配置策略，基於以下幾件事：我們對潛在機會的估值，這些策略為我們的整體業務帶來的TAM 擴張，然後是它們將導致我們核心產品的擴張和採用。所以，我們認為這非常引人注目。我預計明年以及進入明年時會討論這個問題，但為此我們正在進行大量努力。

So, I think a good quarter for us. I really want to thank our team for the efforts. certainly highlighted a couple of them that have made a big impact this quarter, and I couldn't do it without everybody's efforts. And finally, I want to mention that we are hosting Investor Day and facility tours here in San Antonio on December 5. And so hope to see many people there.

所以，我認為這對我們來說是一個很好的季度。我真的要感謝我們團隊所做的努力。當然，我強調了其中一些在本季產生了巨大影響的因素，如果沒有每個人的努力，我就不可能做到這一點。最後，我想提一下，我們將於 12 月 5 日在聖安東尼奧舉辦投資者日和設施參觀活動。因此希望在那裡見到很多人。

So with that, I'll turn it over to Barry. Barry, take it away.

那麼，我會把它交給巴里。巴里，把它拿走。

Thanks, Ryan, and good morning, everyone. As Ryan mentioned, our overall revenue grew 9.9% and our organic revenue in the quarter grew 7%. So a pretty good result there, we think. Just to add a little more color on the product lines, combined product and cutbank revenue increased 6.8% versus Q3 2023. And excluding China, combined product and cutbank revenue increased 9.3% in the quarter. And sequentially, this revenue grew about 3.9%.

謝謝瑞安，大家早安。正如 Ryan 所提到的，我們本季的整體營收成長了 9.9%，有機收入成長了 7%。我們認為，這是一個相當不錯的結果。為了讓產品線增添更多色彩，產品和削減後的合併收入比 2023 年第三季成長了 6.8%。不包括中國，該季度的綜合產品和削減收入成長了 9.3%。隨後，該收入增長了約 3.9%。

Our window film product line revenue grew 20.6% quarter-over-quarter to $22.6 million, which represented 20.1% of our total revenue. And this was the highest window film quarter in our history, which was good to see. And sequentially, total window film revenue grew 2.8%.

我們的窗膜產品線營收季增 20.6% 至 2,260 萬美元，占我們總收入的 20.1%。這是我們歷史上最高的窗膜季度，很高興看到。窗膜總收入連續成長 2.8%。

Our OEM services revenue grew 9.8% in the quarter and represented 3.2% of total revenue. And our total installation revenue, combining product and service, grew 27.4% in the quarter and represented approximately 20% of total revenue. And as Ryan alluded to, our SG&A expense grew 23.6% to $29.5 million. And our current view has SG&A in Q4 roughly flat to Q3.

我們的 OEM 服務營收本季成長 9.8%，佔總營收的 3.2%。我們的總安裝收入（包括產品和服務）在本季成長了 27.4%，約佔總收入的 20%。正如 Ryan 所提到的，我們的 SG&A 費用增加了 23.6%，達到 2,950 萬美元。我們目前的觀點是，第四季的銷售及管理費用與第三季大致持平。

If you look at this year's SG&A in Q3 was approximately $1 million higher than Q1, while last year, SG&A in Q3 was over $5 million higher than Q1. So we've begun to arrest the growth in SG&A as we discussed at the start of the year.

如果你看看今年第三季的銷售及管理費用比第一季高出約 100 萬美元，而去年第三季的銷售及管理費用比第一季高出超過 500 萬美元。因此，正如我們在年初討論的那樣，我們已經開始抑制銷售及管理費用的成長。

Our sales and marketing expense grew 37.6% in the quarter as we've enhanced our marketing efforts to support our increased dealership focus. And our general and administrative expenses increased 16.8% quarter-over-quarter. And sequentially, SG&A expenses were up slightly. We'll have some elevated expenses resulting from our SEMA conference in Q4, but overall, we should be able to stay relatively flat to Q3.

本季我們的銷售和行銷費用成長了 37.6%，因為我們加強了行銷力度以支持我們對經銷商的關注。我們的一般及管理費用較上季增加 16.8%。隨後，SG&A 費用略有上升。由於第四季的 SEMA 會議，我們的費用將會增加，但總體而言，我們應該能夠與第三季保持相對持平。

Our Q3 EBITDA increased 10% to $21.7 million, reflecting an EBITDA margin of 19.2%. And sequentially, EBITDA was essentially flat to Q2. Our year-to-date EBITDA margin was 17.6%. Our Q3 net income increased 9.1% to $14.9 million, reflecting net income margin of 13.2% and EPS was $0.54 per share. Our year-to-date EPS was $1.32 per share.

我們第三季的 EBITDA 成長了 10%，達到 2,170 萬美元，反映出 EBITDA 利潤率為 19.2%。隨後，EBITDA 與第二季基本持平。我們年初至今的 EBITDA 利潤率為 17.6%。第三季淨利成長 9.1%，達到 1,490 萬美元，淨利率為 13.2%，每股收益為 0.54 美元。我們年初至今的每股盈餘為 1.32 美元。

We did have a slight uptick in our inventory levels and result in days on hand in the quarter, but we still expect to see a downward trend on that in Q4 and exiting Q4. And our Q4 inventory should be less than Q3 in total absolute dollars.

我們的庫存水準和本季的庫存天數確實略有上升，但我們仍然預計第四季度和第四季度結束後庫存水準將呈下降趨勢。我們第四季的庫存絕對值總額應該低於第三季。

We did pay down our credit facility during the quarter, and closed the quarter with $21 million in cash on the balance sheet. So, obviously, we're well positioned to execute on our acquisition plans. And as we've indicated in the past, we're certainly not opposed to some leverage on the balance sheet. And probably an effective argument could be made that our current capital structure is suboptimal, but we still think we have very solid plans to deploy capital that continues to generate very solid returns for investors.

我們確實在本季度償還了信貸額度，並在本季結束時資產負債表上有 2,100 萬美元的現金。因此，顯然，我們已經做好了執行收購計畫的準備。正如我們過去所指出的，我們當然不反對在資產負債表上施加一定的槓桿作用。也許可以提出一個有效的論據，即我們目前的資本結構並不理想，但我們仍然認為我們有非常可靠的計劃來部署資本，繼續為投資者帶來非常可觀的回報。

And so with that, operator, we'll now open the call up for questions.

因此，接線員，我們現在將開始提問。

(Operator Instructions) Steve Dyer, Craig-Hallum.

（操作員說明）Steve Dyer，Craig-Hallum。

You talked a little bit about kind of a strategy shift -- I forget the word you used in China. And I guess, aside from sort of trying to get a better dynamic on that sell-in, sell-through or a better handle on that dynamic, what are some of the other things you're kind of looking at in China?

你談到了某種戰略轉變——我忘記了你在中國用的這個詞。我想，除了試圖在銷售、銷售或更好地處理這種動態方面取得更好的動態之外，您在中國還關注哪些其他事情？

Yes, Steve, no, great question. I mean, I think that we wouldn't inflect our strategy simply to present our results in a more even cadence. That's certainly just a byproduct of running the business. The real goal in China is to ensure that our percent of wallet matches the percent of mind share we have with the brand.

是的，史蒂夫，不，很好的問題。我的意思是，我認為我們不會僅僅為了以更均勻的節奏展示我們的結果而改變我們的策略。這當然只是經營業務的副產品。在中國的真正目標是確保我們的錢包百分比與我們對品牌的心智份額百分比相符。

And I think the argument is that we should have room to expand that. And so I think making sure that the product portfolio is right, making sure that our distribution partner has access to the products they need and that that's not holding them back.

我認為爭論的焦點是我們應該有擴大這一點的空間。因此，我認為確保產品組合是正確的，確保我們的分銷合作夥伴能夠獲得他們需要的產品，而這不會阻礙他們。

I mean, that's important to sell. But we've also been modifying the product line, making changes to it. We've added products, but we're going to be simplifying too, to have actually a net simpler product line over time.

我的意思是，銷售很重要。但我們也一直在修改產品線，對其進行改變。我們已經添加了產品，但我們也將進行簡化，隨著時間的推移，我們將擁有更簡單的產品線。

We've had our team in country now working with the distributor this year. I think where we've really been engaged is to look at opportunities in the OEM and for us or dealership space. And these are things where we really need to work with -- work with the distribution partner now to win these opportunities. They can't do it alone, nor can we necessarily.

今年我們在國內的團隊現在正在與經銷商合作。我認為我們真正參與的是在原始設備製造商以及我們或經銷商領域尋找機會。這些是我們真正需要合作的事情 - 現在就與分銷合作夥伴合作以贏得這些機會。他們無法單獨做到這一點，我們也不一定能做到。

So our team there has enabled that, and that has the prospect to be substantial business in country. So, ultimately, a lot of changes here to set us up for more growth and also sort of just optimization of how we run it, which is going to make it less painful and more efficient for everybody involved.

因此，我們的團隊已經實現了這一目標，並且預計將在該國實現大量業務。因此，最終，這裡的許多變化是為了讓我們實現更大的成長，同時也是對我們運作方式的優化，這將使每個參與其中的人減少痛苦並提高效率。

Got it. Sticking with China, a lot of the European OEMs where I would think you're sort of more highly indexed have kind of talked about the difficulty of selling into China, losing share in favor of the Chinese domestics and EVs, et cetera. Is that a threat or something that you're watching kind of over time, just in the spirit of kind of keeping your market share and mind share over there?

知道了。說到中國，我認為指數較高的許多歐洲原始設備製造商都談到了向中國銷售的困難，失去了有利於中國國產汽車和電動車的份額，等等。這是一種威脅，還是您隨著時間的推移而關注的某種東西，只是本著保持您在那裡的市場份額和思想份額的精神？

Sure. I mean, I think you've seen tremendous change in the composition of the domestic car market there and the domestically produced vehicles. And I think we're very much aware of that. And I think part of our positioning here is to make us more competitive in that environment as well.

當然。我的意思是，我認為你已經看到了國內汽車市場的組成和國產汽車的巨大變化。我認為我們非常清楚這一點。我認為我們在這裡定位的一部分是讓我們在這種環境中更具競爭力。

And then the domestically produced vehicles are also an opportunity for us. I would tell you the -- two of the small OEM programs that we've started to initiate this year and certainly one other that's in queue are all domestic brands.

然後國產車對我們來說也是一個機會。我想告訴你，我們今年開始啟動的兩個小型 OEM 計劃，當然還有另一個正在排隊的計劃，都是國內品牌。

So that historical correlation, certainly, when we started in China, the local demand was just almost exclusively for sort of the European makes. And as that's changed, I think it changes the dynamic and certainly makes it more complicated. But I don't think overall that, that's actually a net negative for us. I think the things we need to do to be competitive and grow the business in country are sort of the same either way.

因此，從歷史上看，當我們開始進入中國時，當地的需求幾乎完全是歐洲製造的。隨著這種情況的改變，我認為它改變了動態，並且肯定會讓事情變得更加複雜。但我認為總體而言，這對我們來說實際上並不是一個淨負面影響。我認為，無論哪種方式，我們需要做的事情都是相同的，以保持競爭力並在國內發展業務。

Got it. That makes sense. And then as you guys continue to generate cash and add the cash and your willingness to put a little leverage on, do you continue to look at acquisitions? And if so, should we sort of think of them like they have been where they're sort of tuck-in and some installation and things like that? Or is there anything sort of transformative that you have your eye on?

知道了。這是有道理的。然後，當您繼續產生現金並增加現金以及您願意施加一點槓桿作用時，您會繼續考慮收購嗎？如果是這樣，我們是否應該將它們視為它們曾經被塞進的地方以及一些裝置之類的東西？或者您有什麼關注的改變嗎？

Yeah, no, it's a great question, Steve. I mean, I think we want to be clear that the acquisition of our distributors is a core strategy and something we want to continue. But there's only so much capital that can be deployed to do that, not very much really.

是的，不，這是一個很好的問題，史蒂夫。我的意思是，我認為我們想要明確的是，收購經銷商是一項核心策略，也是我們希望繼續下去的策略。但可用於實現這一目標的資本有限，實際上並不是很多。

And as we're looking beyond that, I wouldn't say we're looking at transformational things. It's a phrase I try to avoid. But I would tell you that we're looking at larger opportunities that could add other services or products to the business that we think are complementary overall.

當我們超越這一點時，我不會說我們正在考慮變革性的事情。這是我盡量避免使用的短語。但我想告訴你，我們正在尋找更大的機會，可以將其他服務或產品添加到我們認為整體上互補的業務中。

So that may be a shift relative to what you've seen with sort of the much smaller tuck-ins. And I think that's sort of why you hear us talk about this, but you haven't seen us do anything yet because we're being quite deliberate in that process, particularly as we consider things that might be a little bit different than what we've done in the past.

因此，這可能是相對於您所看到的小得多的折邊的轉變。我認為這就是為什麼你聽到我們談論這個，但你還沒有看到我們做任何事情，因為我們在這個過程中是經過深思熟慮的，特別是當我們考慮的事情可能與我們的想法有點不同時過去做過。

(Operator Instructions) Jeff Van Sinderen, B. Riley.

（操作員說明）Jeff Van Sinderen，B. Riley。

Just wondering, can you speak a little bit more about the opportunities and plans you have in Japan now that you own that?

只是想知道，既然你擁有了日本，你能多談談你在日本擁有的機會和計劃嗎？

Yes. Absolutely. I think when you look at the -- Jeff, when you look at the go-to-market we have, I mean, the trend overall has been that where we can distribute our own products, we end up ensuring the full product line is represented. We end up ensuring the product is priced locally, sometimes -- or priced correctly rather. Sometimes with independent distribution, you get a misalignment of incentives where you're prioritizing unit economics over long-term growth. And certainly, when we're operating the distribution, we don't have that issue.

是的。絕對地。我認為，當你看看——傑夫，當你看看我們的上市情況時，我的意思是，總體趨勢是，我們可以分銷自己的產品，我們最終確保完整的產品線是代表。我們最終會確保產品在當地定價，有時甚至是正確定價。有時，在獨立分配的情況下，您會出現激勵措施的錯位，即您優先考慮單位經濟效益而不是長期成長。當然，當我們運行發行版時，我們不會遇到這個問題。

So both of those sort of drive the opportunity for just a much bigger business in the traditional part of our business in the aftermarket in Japan. I mean, our revenue in Japan, if we -- absent this acquisition would be sort of a fraction of our revenue in Mexico, and I think -- where we're direct.

因此，這兩者都為我們在日本售後市場的傳統業務部分帶來了更大的業務機會。我的意思是，如果我們沒有這項收購，我們在日本的收入將只占我們在墨西哥收入的一小部分，我認為，我們是直接在墨西哥的。

And I think you can look at any macro stats to understand that, that probably shouldn't be the case. So, getting in country allows us to do that, which we've done for a number of years. And so we expect to see higher margins and then higher growth in country period from doing that.

我認為你可以查看任何宏觀統計數據來了解這一點，情況可能不應該如此。因此，進入該國可以讓我們做到這一點，我們已經這樣做了很多年。因此，我們預計這樣做會帶來更高的利潤率，然後在國內期間實現更高的成長。

I think the newer part of that story and the newer part of that strategy is when you look at our OEM relationships and elements of the service business, where we've got the ability to be a service provider in other geographies, that increases our value to OEMs.

我認為這個故事的新部分和該策略的新部分是當您看到我們的 OEM 關係和服務業務要素時，我們有能力成為其他地區的服務提供商，這增加了我們的價值給原始設備製造商。

You've got places that are space constrained. You've got complicated logistics with ocean shipping of vehicles and all sorts of other complexities. And I think where we can have a presence in more places and a willingness to offer services in these places, we become a more valued partner. So, that wasn't there with the original thesis for why own our distribution, but it's certainly been added to it over time.

有些地方空間有限。您會遇到複雜的物流，包括車輛的海運和各種其他複雜情況。我認為，如果我們能夠在更多地方開展業務並願意在這些地方提供服務，我們將成為更有價值的合作夥伴。因此，最初的論文中並沒有說明為什麼要擁有我們的發行版，但隨著時間的推移，它肯定會被添加到其中。

Okay. Great. And then I know you mentioned the windshield protection product. It sounds like that's just getting out there. I guess, anything else you can add on strategy there if it makes sense? And then also, maybe if you could touch on -- we don't really -- I feel like we don't talk that much about architectural, although I know you did talk about window and then marine and I guess, just kind of developments you're seeing in some of these ancillary areas.

好的。偉大的。然後我知道你提到了擋風玻璃保護產品。聽起來好像才剛走出去。我想，如果有意義的話，你還可以在策略上加入其他什麼內容嗎？然後，也許你可以談談——我們真的沒有——我覺得我們不太談論建築，儘管我知道你確實談論了窗戶，然後是海洋，我想，只是有點您在其中一些輔助領域看到的進展。

Sure. Yeah. I think the windshield protection is a very interesting product. There have been other products in market for some time, and they have a number of trade-offs. But one of the net advantages of moving in this space now is that you've seen the cost of windshield replacement just grow dramatically over time as there's more things embedded in the windshields and they become more expensive.

當然。是的。我認為擋風玻璃保護是一個非常有趣的產品。市場上已經出現其他產品一段時間了，它們也有一些權衡。但現在進入這個領域的淨優勢之一是，您已經看到擋風玻璃更換的成本隨著時間的推移而急劇增長，因為擋風玻璃中嵌入了更多的東西，並且它們變得更加昂貴。

And so if you're looking at sort of the ROI or the cost effectiveness of a windshield protection, like you have much better results today because the product -- the cost of the product doesn't cost more, but the cost of the windshield sure does.

因此，如果您正在考慮擋風玻璃保護的投資回報率或成本效益，就像您今天有更好的結果一樣，因為產品的成本不會更高，但擋風玻璃的成本更高當然可以。

So it increases the market for that. And we like it because it does appeal to people that our core products don't. It's an attractive gateway product as we talked. So, that's good. And we'll see how effective we can be in leveraging it to that end, but it's a good addition.

因此它增加了市場。我們喜歡它，因為它確實能吸引我們的核心產品所沒有的人。正如我們所說，這是一個有吸引力的網關產品。所以，那很好。我們將看到我們如何有效地利用它來實現這一目標，但它是一個很好的補充。

To your other point, marine, that's really in its infancy. We've been growing our number of marine-certified dealers this year. There are specific training and requirements, and expectations we want to set to ensure good service. So, that's been happening. Architectural has been growing.

至於你的另一點，海軍陸戰隊，這實際上還處於起步階段。今年，我們的船舶認證經銷商數量不斷增加。我們希望設定具體的培訓、要求和期望，以確保良好的服務。所以，這種情況一直在發生。建築業不斷發展。

I think what we've had to do in this current environment is really focus our attention to. So if you're looking at how many of the other markets and other areas that we can take our products, be it architectural, marine, we have a business doing bicycles and other things.

我認為在當前環境下我們必須做的就是真正集中註意力。因此，如果你想知道我們的產品可以銷往多少其他市場和其他領域，無論是建築、海洋領域，我們的業務都是生產自行車和其他產品。

How much can we invest in those in the current environment? I would say less than we would have two years ago because now is the time to really focus even more on your core and still pursue those other opportunities.

在當前環境下我們可以投資多少？我想說的比兩年前要少，因為現在是真正更加關注自己的核心並繼續追求其他機會的時候了。

But if you're looking at perhaps some planned investment in some of those that we may have anticipated two years ago, we probably curtailed that some. So, they're more on the organic growth and each has a different trajectory, but they could all be meaningful businesses for us over the long haul.

但如果你正在考慮我們兩年前預計的一些計劃投資，我們可能會削減一些。因此，它們更注重有機成長，並且各自都有不同的發展軌跡，但從長遠來看，它們都可能對我們來說是有意義的業務。

And I realize it's still early days with the program you have with Tesla. But just wondering, I mean, are there ways that you could -- or I guess, plans to expand that further perhaps to other OEMs? Or how are you thinking about that at this point as far as growth opportunities?

我意識到特斯拉的專案還處於早期階段。但我只是想知道，您是否可以（或者我猜）是否計劃將其進一步擴展到其他原始設備製造商？或者說，您目前如何看待成長機會？

Yeah. The referral program we have -- that we have out in collaboration with Tesla is something, obviously, we want to grow with them, but it has application with other channels, with other manufacturers, with other influencers, and we're having some discussions on those.

是的。我們與特斯拉合作推出的推薦計劃，顯然我們希望與他們一起成長，但它也適用於其他管道、其他製造商、其他有影響力的人，我們正在進行一些討論關於那些。

One of the challenges of this business is how do we bring a larger portion of the new car buyer into the mix to buy any of our products. And where you're an enthusiast buyer, you know about products like this, that's great.

這項業務的挑戰之一是我們如何讓更多的新車購買者加入購買我們產品的行列。如果您是狂熱的買家，您知道這樣的產品，那就太好了。

We do exceptional, but then that's a small percentage of the total pool of new car buyers. And so if we can add a product -- add to the product mix like things like windshield protection that might appeal to some, but then find other ways to reach these buyers in collaboration with manufacturers through marketing efforts and lead generation, which we really have ramped up and are really doubling going into next year, obviously, dealership sales, all of these things have the ability to reach a much broader pool of buyers.

我們做得非常出色，但這只佔新車購買者總數的一小部分。因此，如果我們可以添加一種產品- 添加到產品組合中，例如擋風玻璃保護之類的產品可能會吸引一些人，但然後透過行銷努力和潛在客戶開發與製造商合作找到其他方式來接觸這些買家，我們確實擁有這些顯然，經銷商銷售量在明年會增加一倍，所有這些都有能力覆蓋更廣泛的買家群體。

So a referral program like this or a dealership program or more marketing, they're not -- one is not better than the other, one is not preferred, but they all have great opportunity to expand the number of people that we can reach.

因此，像這樣的推薦計劃或經銷商計劃或更多的行銷活動，它們並不比另一個更好，一個不是首選，但它們都有很好的機會來擴大我們可以接觸到的人數。

And I think this referral program, we like it because it can drive business to our installers and folks that wouldn't necessarily go to an aftermarket shop normally through a referral program, we can drive them to one. So, I think that's super powerful and it's just a matter of getting really good at it, scaling it up and applying it to all the opportunities that we can find.

我認為這個推薦計劃，我們喜歡它，因為它可以為我們的安裝人員和通常不一定通過推薦計劃去售後商店的人們帶來業務，我們可以將他們帶到一個地方。所以，我認為這是非常強大的，只是需要真正擅長它，擴大規模並將其應用到我們能找到的所有機會。

We have reached the end of the question-and-answer session. And I will now turn the call over to management for closing remarks.

我們的問答環節已經結束。我現在將把電話轉交給管理階層進行總結發言。

I want to thank, everybody, for your time today. Look forward to speaking next quarter, and have a great day.

我要感謝大家今天抽出時間。期待下個季度的演講，祝您有美好的一天。

This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.

今天的會議到此結束，此時您可以掛斷電話了。感謝您的參與。