OCC - Earnings call transcript Q2 2018 | Optical Cable Corporation

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Operator

Good morning. My name is Laurie, and I will be your conference operator today. At this time, I would like to welcome you to the Optical Cable Corporation Second Quarter 2018 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer period. Mr. Instructions] [Operator begin may Palash, your you conference.

Aaron Palash

of and on participating morning, By time, a all earlier release XXXX for Cable Corporation’s this copy have should you Optical everyone earnings second today. call. press issued Good conference thank the quarter year fiscal

also www.occfiber.com visit can a copy. You for

On Officer. Tracy President Vice Smith, Chief the President today Officer Executive and Wilkin, with Neil us Financial Senior of call Chief are and OCC; and

statements statements differ this we involve begin, on of referenced the to forward-looking like those uncertainties. but in may to, actual Neil apply risks of the that as Before to this not www.occfiber.com, statements forward-looking the the The please remind morning's to everyone over contents turn and as including, number call Wilkin. that, Internet I'll of Optical Neil, With contain that and Cable of begin. materially I'd today's These future a risks limited factors call call. webcast results factors section to well cautionary press Corporation due may release.

Neil Wilkin

then can. months call three quarter results the we period and After XX, fiscal ended Thank the will year begin quarter April opening and six with Tracy our a for everyone. the few XXXX. some remarks, will will and your answer as of questions I Aaron months we XXXX Tracy's good detail. additional as many remarks of morning second regarding you, today second review

session. and As investors is our normal Q&A only from we practice, institutional questions will during the take analysts

release call. the included submissions Instructions our and advance offer questions our However, in announcing earnings in time date are shareholders other of submit such to the call. also we our press opportunity regarding of

increasing to second established last sales fiscal that period year. net report XXXX sales almost for record quarter We OCC of quarterly from XX% same the net pleased the are a new year during

fiscal per during XXXX. increases $XX.X XXXX. net and achieved sales net -- We and quarter for of in of second recorded of quarter reported the million gross year-end share income $X.XX year-to-date the for also fiscal both, periods consolidated profit significant with We net income

During we the the markets, strengthening time seen year, second carrier particularly at have weakness same quarter, seen. we to some our market have and in similar also specialty military during the this others in the our see what enterprise markets; to in fiscal industry wireless continue

believe We will including sales take positively our net we in continue steps targeted enterprise impact to market. the markets

reported impact we $XX You will end load at our recall positively XXXX quarter backlog February a quarter believe million we would results. second which that that forward had last the OCC of

order we of Looking We of of XXXX, OCC have has forward reported net year with as year a fiscal increased by quarter. quarter first and as sales for net in significant fiscal the been the years. third period backlog quarter backlog typically being $XX.X backload same believe net will current million forward, just our in sales forward at reported sales than in forward would higher quarter, number well the OCC's customer increase or second higher lower last one half of than backlog course of lower the end and load our likely load second forward we this expect we the result driven sales was orders quarter. load done last than load the second the the from whom during than business the our

end-to-end various solutions OCC the base, market sales for of impact geographic will believe broader diversification a have and strengths markets have with markets. OCC's strategic and marketing sales tailored application positive at on target will always to we by these base user focus continue the end and has diversification on diversified One sales. of initiatives OCC's the efforts and the level of including OCC's been at level,

leverage operating being previously SG&A leverage costs, we to of a additional second of bottom certain demonstrated relatively fixed As levels discussed, and OCC and in higher public company specifically cost impact including it's an of remain net cost operating as line of at disproportionately production quarter bottom of sales stable tend results where the is positively increases were terms our XXXX. in levels, line sales results benefits as during increase. sales The the fiscal strength our

quarter. an production the handle demonstrated increased also during We to ability volumes second fiscal

large to and well production Our increasing on our capacity realize the on in positively ability accommodate volume initiatives only equipment remained OCC's operating as previous on and our of investments marketing executing focused benefit efficiencies. targeted but as leverage, to drive our resources. reflects to sales also not We production sales in markets operational

confident bottom the line that who to now the and with in shareholder enhanced of areas, top over these that, are by continue growth to of specifics both I'll drive turn succeeding Smith And will some results. will We deliver quarter call our value. financial Tracy second review and we regarding

Tracy Smith

specialty fiscal and increase quarter sales partially XX.X% in We half the period an of have carrier to a decrease million, business for sales customer one the million, backlog net XX.X%, during the to quarter to second sales of XXXX net compared from year, fiscal for million by first OCC were net markets driven first sales and markets. second half orders fiscal compared $XX.X the significant our half whom has in for sales and fiscal done load net of $XX.X was net the $XX.X second increased for the enterprise with increase of year first our in military Thank XXXX. of Consolidated XXXX increase an second same of and sales a the in last half were increase Neil. XXXX. years. particularly in number of the offset quarter OCC's fiscal been our in fiscal XXXX by of This forward markets. wireless net first XXXX net you, of sales of million of quarter for compared Consolidated $XX.X

net X or XX April approximately or trailing As sales our load load forward sales weeks basis XXXX million February comparison, a backlog on weeks on basis. XX, to order week XX-month $XX of the By sales forward sales approximately of trailing XX first our net sales basis year our as XXXX. to end of of quarter or on net XX-month to was $XX.X XX-month million and backlog trailing the XXXX, XX of a $XX.X X of as of XX a fiscal was end order approximately of million of

will throughout sales net to sales during backlog last current quarter the Based our than sales forward during $X but net the during to vary same quarter the second generally on year it's the $X be higher and weeks less forward approximately our load, X between load period we XXXX. million. of order X million Our year approximately anticipate the than net backlog sales sales can of third or net

fiscal $X.X fiscal in of $XX.X XXXX. Turning quarter first fiscal of as of of in gross compared fiscal to to Gross $X gross net second in XXXX. was margin sales net XX.X% million XX.X%, fiscal was to an XX.X% in or profit. quarter second of XXXX. profit profit XXXX, of the compared was XXXX, in fiscal fiscal XX.X% in a compared half $XX.X compared or gross a as of percentage of profit the XXXX, first the million in margin the XX.X% Gross to sales increase XXXX. first fiscal increase the quarter half profit an was XXXX, XX.X% of Gross profit second the half quarter the the million percentage million Gross to of first second half profit in of of

same XXXX. profit Our the the product gross profit heavily sale mix margin quarter compared of towards lower in of basis. products period first impacted to quarter second fiscal shift in dependent a certain Gross XXXX by margin are upon product percentages and fiscal margin XXXX, in fiscal quarterly half a and was of half first mix second in negatively the on the

However, $X.X for $X.XX increased availability compared million financial and second fiscal and XXXX quarter sales half can on OCC net in incentive per of levels of offset $XXX,XXX impact gross recorded share sales. and during over $X.XX capital of of XXXX. compared product during increased was commissions. second including were XXXX, XXXX. a expenses sales fiscal last quarter attributed SG&A compared year. diluted XXXX Bank million XX.X% second were year. period $X.X XX.X% a of the for spread special Pinnacle recorded of to net percentage during basic loss half to half facility it's fiscal margin $X.X $X.XX diluted percentage of the helped net period the SG&A XXXX, This with half the in In costs first first of diluted first quarter to XXXX diluted of decrease same additional period XX.X% $X the first fiscal compared employee-related to half and of XX.X% XXXX $X.XX to year our of in XXXX. net net quarter the profit XXXX. to as or optic for some second same in share second in revolving to fiscal the quarter credit the or working same manufacturing gross of second $XXX,XXX quarter fiscal for sales a basic as and to fixed compared of a of note half obtained the quarter The first million of improved certain costs, first first profit expenses providing or XX.X% project OCC fiscal and as for basic of net expenses credit $XX.X income income in increase or for cable the and compared in XX.X% fiber of employee of terms per XXXX fiscal the significant fiscal for as loss half of a primarily XXXX. XXXX half high increase and million SG&A last million quarter of of were the of fiscal purpose. OCC share per million fiscal from SG&A during XXXX, our share the the April $XX that the compared per and $XXX,XXX to net the increases in for last second second be results basic expenses sales to result increased of renegotiated SG&A the to first net fiscal fiscal during expenses the

As note no outstanding our available our on $X $X.X of had and of and note, credit. credit revolving $X.X project we in million borrowings available million special credit revolving on April XX, XXXX, and credit million

We million real of Neil. under estate will outstanding loans. With over balances turn back that, the $X.X our I to also call loan had term

Neil Wilkin

questions any happy And instructions I are in you, you for answer questions, it. them. they indicate Thank participants would have, please we to Operator, may the have Tracy. appreciate any if to now our if you could call

Operator

[Operator Instructions] this no are at time. questions There

Neil Wilkin

Aaron, questions Okay. there submitted in were advance call are any that individual at the today? investors by

Aaron Palash

a advance in I Cohen question you play Jeffrey submitted by Neil, any call the for have border shareholder. of the non-institutional Yes. going wall? was do part to asked, that are security

Neil Wilkin

into negative comment industry, sell don't continue taken of comment any many security sort do not government affirmative do inference negative with private both specific sell wanting and respect and into also or affirmation on an and provide a markets shouldn't that. to market my -- different and we the projects We or for project. Okay. we'll to any shouldn't the as it We be to -- on

Aaron Palash

That's all we received.

Neil Wilkin

today. our other be second to like no there questions, would to I If call listening everyone thank quarter conference Okay. for

always, As appreciate in your your you. OCC. time we and interest Thank

Operator

second does XXXX That the you. earnings conference Corporation's call. Optical quarter Cable Thank conclude

You may disconnect. now

Optical Cable (OCC) 11 Jun 182018 Q2 Earnings call transcript