BDR - Earnings call transcript Q3 2019 | Blonder Tongue Laboratories, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, ladies and gentlemen, and welcome to the Blonder Tongue Third Quarter 2019 Results Call. After the presentation, there will be a question-and-answer session. [Operator Instructions].

At this time, it's my pleasure to turn the floor over to Mr. Bob Pallé, CEO. yours. is floor the Sir,

Robert Pallé

Thank you Tongue's Reporting Welcome Blonder morning, We much. Third Quarter Good participation. XXXX your Financial you everyone. and thank to for very X Teleconference. Months

prospects contain those view morning, begin we to evolving remarks subjects, Blonder and speaking may our certain representatives, this today, of you will made Before will I'd by be other by the discussing forward-looking reminding presentation in preface management's marketplace. like my who our statements be including Tongue and trends that which we

As predict, our you those that may impossible know, that the future this from comments so actual is to differ in you I caution projected morning. may be results

will information could including well I factors and that morning, X-Ks. quarters, our XX-Ks of you to would 'XX second cause ask additional years first our you differ and XX-Qs XXXX to Form concerning including filings, discussed information as SEC be the our as prior and XXXX that this results For prior that for refer our actual from for the quarters

the are Skolnik, Financial of Operating Shea, Chairman Officer; Grauch, Chief Ted With me and today and President Steve Eric Board; Officer. Chief

us sequence. answer during will that in presentations all available period. following question-and-answer any the be same Our presentations, the of questions follow you have will to And may

We to major achieving improvements value. in order outlined result of years, stated a within in in an As financial improvements, remain prior a which those achieve committed teleconferences goals. performance, drive increase letters in to the our areas we major as needed and for prior successful my those to stockholder you and in we turnaround to effect

repeating. press comments bear morning believe the in our release We this that

for initiatives intention level increase the the our of We of our quarter our Last sales performance. intensity operating and the disappointed and are new to quarter, we lower announced expenses. the third in financial product resulting sales

Transcoder the sales of we line recently products. product initiatives, introduced new ClearView Regarding

new functionality providers near additional been company's X:X Several developed and to versions in by video the use-case encoding, to these those now requests, anticipated and that year. Two X satellite We the in specific will Gateway is to the end modules to be this ClearView will service comprise increasing transcoding of of first service planned in prior ClearView be products to Tier will products for and production anticipate of released approved additional and providers. future. are to lead sales cable entertainment large these have The which the perform of to response production security family this of service enable NeXgen enhanced that functions. other provider video

expect the we sales pleased Box We continue and with increased to initiative. Set-Top the Box IPTV Box future second to growth response third Set-Top to also continue into quarter, IPTV XX% our IPTV be the from quarters. Set-Top to

will have enable operating to Regarding cost Box initiatives. will number reduce a is steps manner that a Set-Top maintain implemented Gateway us additional quarter, expense steps need additional clear IPTV the developed further. third These that take them and we be of it to reduction implemented; NeXgen were savings that with the momentum however, efforts, in during we the to initiatives

way. bottom available breadth We these including suite this of which that effectively color both functions, and products in NeXgen devices transrating, our the state-of-the-art series believe including being top signal inure transcoding, physical little rack capability of digital will the mentioned the acceptance, ClearView This decrypting. traditional style Blonder blade decoding, Tongue several XX-inch processing lines release that of drive products a and on both of technology in market ClearView made the series formats, and in encrypting Putting the should are series Gateway a and material encoding, modular of the press the is format new products the products. manage new format for morning, full

that and both and committed new the engaged resources earnings during have comments sales the to the that talent to development I the second Similar made initiatives product quarter call, move management believe forward. the we we

company the expect transitions investment period expected on profitability. these a As before our of go to new through technologies, to positive continuing impact and our products resources see of financial we we

the Now Ted I'd Chief to Ted? President like over Officer. to Operating and call Grauch, BT's turn

Edward Grauch

Bob, everybody. and you, Thank morning, good

calls level as as our we yielding to As resolve this met possible. year, Bob have touched and quickly management not company our on sales for as at and financial performance overall. this has a been acceptable previous current actions We've the our this stated and continuing not adapt morning on targets levels are are to

recently, major segment moving more technology. A quickly equipment, access been and from market including types have to for cable changing and Ethernet -- issues larger infrastructure due recently a of moving distributed coax-based of portion specific these fiber, towards most legacy telecommunications a more wireless, towards

technology Internet, also X overall beginning advanced changes, and of at trends actually had number are requirements. now to market lines to with the -- in X address XXXX these In is video for in more we've transcoding actually these had and to development all of new and in the changes the during anticipated a Tongue trends. a those XXXX, entering over-the-top compliant demand technology newer years CDN seen market of for movement we've addition the product rapid order last IP-based that Blonder

our value-added with of series and now seeing television across products new impact, address and operators trends the the changes continued Tier in municipal and that to service into the flagship providing television with last of IP efforts our large We've by the North conversion fronts, This telco, market positive are and our program trends make is For advantage our going Tier America operating taking and lower and including operations cable those efficiency QX to are customization working X IP to system majority X technology set-top IP of on and organization new to released right create month-over-month. coders advanced since fiber year are operators on sales now. momentum Gateway have NeXgen transcoders in costs product, monthly this immediate we solutions sales also a boxes services. that

As growth Bob of seeing in this are mentioned, have QX specifically year. we seen sales component QX we this strong from our -- to of

sales seen operator also our have this NeXgen X several launched very growth and year-over-year, signal new of line and year. line in good product earlier our We good including Tier fiber Tier processing distribution X a product wins initial video

trends. the in that the line lowering towards into achieving Overall, with revenue those will year. we're new necessary sales also profitability, monthly our product this in the with and costs We're turn of taking investing activities growth market measures end move investing to operating of technologies before the introductions goal in

Now the turn like to I call over Eric? our would Officer, Skolnik. Chief to Financial Eric

Eric Skolnik

Ted. Good you, morning. Thank

X.X% XXXX due prior And to quarter with third product decreased down year. prior being mix sales lower-margin to traditional XX.X% our margin product our lines. as to net to compared The XX% compared more period blended the were gross in

The As sales company's historical a as result, Set-Top The the percentage margin Boxes, level company will company lower the of margin at foreseeable anticipates sales than a result these which and future. a product expects growth of the than traditional sales, company's for the lower the of Box of IPTV is in margin remain a lines. as gross additional percentage carry IP trends. more gross as growth that sales lower a of a Set-Top

to company's primarily the expenses This due of an period efforts comparable X Operating fees. to increases, increase were these compared year. is as as months XX.X% continued for various third prior as up approximately the -- contain which necessary headcount salary reduce costs to last in were and XXXX the due increase well consulting to and

period ended XX% were as down September prior Set-Top the and of XX.X% sales mix net XX, compared months to and blended in XXXX, the X.X% gross product compared the in our due lower-margin to to X aforementioned the growth to the IPTV Boxes. sales margin decreased year, prior For

months is headcount to compared last comparable for salary due contain increases up as company's to were due This and XX.X% to and costs. of approximately first efforts X expenses to the these continued Operating necessary primarily increase reduce the XXXX prior period year. the

on consummated our funding transaction MidCap working and a new help $X company matures and the fund replaces with liquidity provide been I has Sterling current in On million report X credit terms of the will consists that facility credit revolving that to line existing XXXX, facility with financing National XX, front, us This which credit our years our am $X financing operations. the greater Bank, capital We future million planned believe October with Credit. and and Business a improve to pleased of terminated.

the Now call I'd like to session. to up question-and-answer open the

Operator

from a have do Bourbon, We Investor. Instructions]. question through Private Gregory coming [Operator

Gregory Bourbon

What for is XX-Q not the the to of the was get What OpEx? expense a we income, quarter? is operating questions. Before since released, couple this

Eric Skolnik

expenses operating are for quarter The this $X,XXX,XXX.

Gregory Bourbon

the from flow Okay. Roughly operations? QX. the And same cash as

Eric Skolnik

Well, it operating The we used $X a million activities. to in basis. be do don't number X-month is quarterly on expected

Gregory Bourbon

And is given right. ability, financing the level All what of available? new borrowing

Eric Skolnik

facility new block. currently change. a new a $XXX,XXX the -- old facility that The And had from million is from block liquidity the significant between $X our and facility change perspective is biggest facility biggest old the that and the a only the has

a million. that's So pickup $X.X of

Gregory Bourbon

all increase, million $X.X Okay, right.

to to the Let's are expect going forward. time revenues this impetus to What's this seems is the prior It like a the end Specifically, year? of major line be ClearView see. going from any we line?

Robert Pallé

We do.

Gregory Bourbon

guess -- any size the eventually as what be? might estimates what And or to market

Robert Pallé

$X.X million a million to year We're a million approximately, thinking add. year $X $X

Gregory Bourbon

we Xs? any have signed And on Tier more with Okay. it

Robert Pallé

We have Xs. not additional -- working Tier on we're

any to on additional Tier Xs. signed haven't We

Edward Grauch

additional three funnel Tier sales had engagements. Xs We've our in active

We yet. have them any closed not of

can't can sometimes but you actually long. the closed this as positive, are cycles you processes writing, of until very equipment be in follow are if right? industry, looking any sometimes make sales the And things in kind we of commitments this know, course, -- So

Gregory Bourbon

X. right. release, the requests -- in development in Tier Long, fielding the conversation your Is new those Are new speak? In in press of kind Tier funnel, modular with modules X? you you current with with the so folks mentioned that the to

Robert Pallé

Both.

Gregory Bourbon

I growth percentage you. outstanding The set-top to have see expect to can I XX% increase the near quarter-to-quarter, that rate anywhere we persist? else -- increase QX, is Okay. in what to QX box, or of for to that have

Edward Grauch

a few that years, revenue at for growth, you least overall segment say, grows, years next X.X factors. sustaining see a But or depends it would if know, of X on the level segment business year, growth that so. we of the As not being I as new

Gregory Bourbon

welcome, of products near business vis-à-vis the line these a How the the head with given ClearView foothold. All right. stand of of new overall? do introduction we -- very that's do the flattening of the in we Or where and the the are we stand until gains Well, sort competition, the legacy line?

Edward Grauch

to other who should each Sorry, answer Bob one. see at and I first a take that step. are looking I'll

head So we cases, meet well the definitely working X Tier of Tier Xs, we're with the related ability I of the developing their are some our at markets. depending and think the prospects the of bigger to of as as use features functions on line the to some

sort it than newer -- got we've we competitors got our new to set we've capability a of all, at the technologies modern functions architecture in not interesting and a moment. put of So bluntly, most, really if and of more believe more newer,

competitors take won't forever. stay products cycles. That stand won't R&D tend our long But Now still. these to

in we've step to add that, sales perspective the from up So to Anything opinions. got Bob? to our

Robert Pallé

that's No, I accurate. think

Gregory Bourbon

there? are distributed on we can you What surprise. [indiscernible], caught that? me exactly elaborate These Okay. referring to That by

Edward Grauch

did We ago. trade over press Cable-Tec a release show yearly month -- Expo at a a just little the SCTE show

-- product supports that are a PHY. released a we We have Remote

to our organization. equipment sort interoperability of fiber residential it's some the hosted bigger municipal network by And where product interoperability next-generation network the is DOCSIS with of CableLabs allows of particular players, to into deeply capability that their HFC distribute allows them the portion closer operators, push and So network, that standards of distributed DOCSIS, and is allows fiber an et more and into It of the the homes. cetera. telcos, deeper by them customers' over a sort to overseen

DOCSIS, of a get bandwidth to use generation it distribution and next in it Ethernet coax doesn't environment. residential the exclusively uses network the fiber of deeper into but sort it's So technology, a data higher

Gregory Bourbon

again, market Okay. Well, the elaboration. And guesses? thanks any size, for

Edward Grauch

think technology And on their make we're internally technology share But we're have the cable still them it their into upping one, the it speeds newest publicly information bandwidth absolutely technology. that. too very waters is to trying where to decisions on to has be on to works it's this the But just last last operators, are coax mile portion network the be for That a early operators in years of mile. point delivery of I of conservative the the starting generation or been is us testing X/X this. to because for homes. who just the This related to latest coming and in related

Robert Pallé

lot the But how is customer There much DAS, do. we're and products that leverage And Greg what Distributed our sell. to of for the we applaud plan Ted Yes. the Access I present available. cautious to a we we get that information, about base see we going about can could or Systems being

your we this Xs about we dollars that on this, think in the market, see go So when Tier of so. research are can do operate you'll spending but talking you billions

Gregory Bourbon

others? verticals were the and this are was So the the last new ClearView, in or two? Or any the reference call there for those

Edward Grauch

we works press have the release. in others are There in that

for spending we're them that R&D new and but announced the time to lines I not moment, some additional marketing we'll So we product verticals partnership yet. confidential bring we're keep aware have think some

Gregory Bourbon

it's to how of how the call, last appreciate so Well, -- lease the any sort. the new be the space call, mentioned And market is going? space I as of any months -- regarding X.X given finally, we the before that or introductions interim releases going in the in next are press

Robert Pallé

Any in one not and for a -- The level town made people leased. extremely lower have speak that through now to us all ready it. We're of can get The of difficult be to -- us for CO. position. it it's

moment. the can And in the CBRE and great, leased. tenants, activity and are amping we I we is sign do prospective ready, that accurately? who people, any helping space tour are we the up their think us when So get Did space

Eric Skolnik

Yes, you did.

Robert Pallé

and Eric's bolts nuts actually this. a on little closer the to

Eric Skolnik

You're correct, yes.

Gregory Bourbon

to soon nose your a then year, of if Keep grindstone, the to end and not right. revenue, look boost All by the forward the thereafter. in

Operator

Investor. Instructions]. question Private from have We a do [Operator Lloyd Sims,

Lloyd Sims

I on, part a They're down the where products? margin you guess, majority the of the XX%, line. the assume can comment I business, bottom the core and So headend video of digital to is that's

-- understand that do the I So you new there? I decline But with we in. when that happening expect coming have to guess, what's plateau? And products

Edward Grauch

mentioned my I've head, not a in you XX%. That's number number got but... the So

Lloyd Sims

to X.X quarter. that I But last from think it from went X.X correct? Is

Edward Grauch

Yes. Right. yes. Yes,

So this the of are major first quarter our the anticipated year. release. and the older The had The or there that this all would in took decline bit that few next be elements the decline demand that a timing are a trend decline products alluded products to minor significant We was in for of those X in encoder year that elements of related fairly a press decline year. either surprise. to cycle a version

introduction we of the and the been those So and selling And middle now accelerated that since the least online we've new actively in at to over of have products working year. last come production. started on the summer

year-on-year. will that chunk up of So reduction that pick some

make we've deploys has products knew that strong been few the last are very of second market us, just accelerate that general decline, anticipated yet years. And previous our we been very to the product why than not different other recovered in the those had customers working introduction in faster The that's fundamentally, big to But point. moved And that segment technologies themselves. some that The in loss. a new question, than has the new segments sales. a releasing that DOCSIS those have customers market end not first other element been to up our be faster again, And trend had we a been have told press decline released in traditionally some in steep and in quarter in is early or the further push market has took at verticals we'll yet. the Greg's quarter year investing despite

market and that any is there is of market that of glean new that sustaining. market margin is if currently, we still even the has moved. see news, the sustain we're has that we'll good same reintroduce still that of products where we though products what whole declined, the the has can introducing The to piece turned cover level out the newer the where From when situation,

specific our So does of that not do believe business have we portion margin -- not pressure. will

have We pressure pressure. scale more margin than

Lloyd Sims

we little I waiting -- more mentioned industry the think from you products technologies a they're the just they delaying it shifted so a Or -- launched about for the new Is clarity. bit of away ago. other And are technology because new Or and has at product? out there, types purchases? some year looking they're

share more why competitor? at hold look of take market So that's a a it a I'm they a as are to And decline. is kind from that market there? such Or out a loss I analyze technologies guess, on perspective why buying it wondering, the the new -- is

Robert Pallé

we are customers actually buying products. not have have blend some do to clarity to the the have have buying, volume this is products when -- the January, X of competitors know would finish just of they But introductions customers our in that stop of saw specifically and our the need don't a them it's I February the on we be our perfect of some gone as meantime, they introduction. customers that but Part waiting exactly we be sales a of we you on our things our do prefer of time it And themselves to about. some change. enjoyed frame that talked product gap since product while release

to fill a it's but blend loyal a you They've or some new waiting can't had good gaps. got it's So it's XX-XX We've percentage both. customers of XX-XX, tell of both. if products. I on

perspective products competitors have. And introduced are head standing but our but that's what we our we temporary, shoulders believe lost quality it's just We because opinion, we coming some just not the from a our own and think above have customers. it's from have share,

Lloyd Sims

have do this expect at point? to this And you hit the trough? Or bottom be we

Robert Pallé

my I now to I a segments. We're we rumblings very from can product our see the we those -- and our customers right what twice specific answer From been won't anticipate hearing It particularly with we don't can questions earlier see year like our telling knew not more currently. be to wish engage, But we opinion, what be on open, tougher us, eyes customers customers new experienced the this Boy, to trying doesn't engage we're are push we're and that have to and blindsided. question. trying we be and teams keep hit to we mean can't those ask open to and trying I so blindsided. their sales anticipate not free

Lloyd Sims

Okay.

your Just a do the technologies delayed lot the see there, purchases and end perspective in hotel specific from product industry that's see wait as on opposed perspective? let's as you technology say, change to different an to, they on out pan going of

Robert Pallé

I some out Those see of coming pick slowdowns transitions. particular the deployments there, well, of our production is last we some starting let to starting products customers technologies been of happened this that talking to don't waiting of and now we QX delay and few about time slow question frames. of in technology The QX those for have into seen because encoder deployments what the some part early and seen field. the just new have have introduce see We've answer -- just the we're we've transcoder questions, way. up, products. down some them me and been the back demand of that been our Most

dramatically service technology No, the hotel I a see for dramatically. to But for new to of anything level, waiting no, change changing operators some macro the at or I related don't. segment waiting don't one

DIRECTV, want to depending they're will changes sell because of they does off video on hotel there with potentially AT&T what the that come, think I yet a large has part big But and DIRECTV. hospitality provider. service be because AT&T that's said to

business, that a any time, don't the that. effects make And long move, immediate around those have on effect, because don't have period details So we timing and know transitions. we play it even they the would a of that could would those think if future over did out any but

Lloyd Sims

Yes, business. I of are all to didn't the the happening positives from away that congratulations on other the take -- side too, mean the so

be Just when Q the issued? will

Eric Skolnik

The expectation Friday. to filed is on it's going be

Operator

comments. I'd Since there questions you at over to call to any no time, turn this are back like further for closing the

Robert Pallé

day. teleconference, Thank our everyone Thank quarter you very in first we speaking the forward you look much. with to after next of great Have year. participating for to you the and a

Operator

And ladies appreciate today's conclude conference. participation. your and this does We gentlemen,

You may at this great day. and a have disconnect time,

Blonder Tongue Laboratories (BDRL) 10 Nov 192019 Q3 Earnings call transcript