FLUX - Earnings call transcript Q4 2022 | Flux Power Holdings, Inc.

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Operator

Greetings, and welcome to the Flux Power Holdings Fourth Quarter and Fiscal Year 2022 Financial Results Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation.

As a reminder, this conference is being recorded. I'd now like to hand the call over to Peter Geantil, Director of Product Development and Marketing. Peter?

Peter Geantil

everyone. Hello you. Thank

release XXXX. year Time are crossed our our will Eastern Chief the for and these of today and XX, presenting Executive our fluxpower.com. available is in Chuck afternoon operations June fiscal quarter fourth Scheiwe, Relations detailing Financial X:XX company's section at this of at results our which Ron press A host PM and ended Chief Dutt, Officer; wires results XXXX, the Your Investor Officer. website They

Before the everyone include forward-looking. that begin and on formal we information like presentation, considered may to that the I remind predictions, webcast made other be would estimates or the statements might call

to our judgment could future statements that what differ forward-looking cause actual represent these results While current and risks to uncertainties are on subject materially. the holds, they

cautioned statements, business forward-looking ourselves the keep You not we on place as predictions. which of release are revision reflect to in some new this today's are may to reliance of statements of publicly light opinions presentation. revise events. in future to or our information Please or we'll any only that date results relating our factors attempt undue affect these not mind to to discussion, of our obligating important these present forward-looking the that Throughout

Factors. Executive the Risk complete Flux Power a should to these You heading Dutt. and turn Officer, XX-K this factors particularly also the Ron review will our discussion now of more under over other Form XX-Q for time, most Chief Form call recent and I risks, At

Ron Dutt

quarter conference welcome good pleased and XXXX financial afternoon, results am Peter, call. to Thank year you fourth to today's fiscal I and you, everyone.

'XX, along growth in demand from year year-over-year quarter, the from trend orders million consecutive equipment, new product compared revenue our battery our a multiple airline reflected prior customer Fortune few fiscal orders from fourth with in million large to the $XX.X $XX.X who moved fiscal packs of battery our marking And customers, support fiscal improvements. all the million, up XX% addition air existing on the strong customers. we million fiscal In the from customers our of we 'XX. lithium-ion quarter of orders $X.X the year during receiving increased further, year quarter XXth an fourth growth. the revenues successes, revenue of and quarter to purchase global pandemic Revenue from the were acquired we beyond XXX new customer travel, had To we ground $XX.X initial year. customer began received existing XX% revenue packs of in constraint for year year, fourth million $XX.X in experienced. 'XX highlight new In of for prior GSE, received Our in

fourth backlog well the future by customer actions XX, $XX order sourcing bodes increased June in quarter, which For to XXXX, helped decreased supplier improvement part our shortages, to mitigate - of performance. million confidence as for in

XX, also that of compared are -- backlog turns include as gross $XX.X to These also increasing are lower capital initiatives as XXXX, million to March towards profitability. XXXX, XX, XXXX. of $X.X shipments XX, To end, June as $XX.X million million June increased of initiatives and will driving also conversion of that shipments to increased accelerating and strategic orders Our lead working inventory needs. margins

introduced Material order our MODEX three the flow at with million XX% to prior compared from orders products the million March, fiscal not Handling continued installed acquisitions. base only demand, new strong 'XX in Show. 'XX. fiscal year year to but New relationships customer XXXX annual reflecting $XX $XX.X in In our increased new year [indiscernible] Trade customer we

pack LXX battery the or lithium-ion at popular forklifts. model X-wheel the XX-volt First,

robots. for SXX Pallet Jacks. And designed or provides Walkie hours ours of lithium-ion high-volume pack pack twice the to quarter. global the We autonomous battery lithium-ion during pleased improved the chain amp or mobile CXX fourth lastly, for capacity guided the XXX and were the Secondly, see disruptions automated supply that the vehicles that

we lithium to the at onshoring profitability could and in time, supply pursue potential expanding a strategic believe same production modular alternative the in-house initiatives. taken We improvement to to cell assembly. the to we we assembly as sourcing. chain serve using continue While U.S., future chain in Throughout have of project efforts supply issues. reduce cell reliance bring a XXXX, in offshore launched aggressive modules mitigate automated With

increased volumes high-volume suppliers. resource to and into to regions leveraged sales also pack We low-cost steel board components

carriers cost increases, to shipping During meet competitive shipping suppliers required that in the costs utilizing lower-cost more reduce we steel found year, to response are and specs.

turns million. inventory XX, And our to x of modular for lower operations. new introduced customer X.X of $XX.X demanding decreased servicing, needs. first we designs other part platform be new new address few our improvements forklifts. capacities sold -- listing same our cost based XXXX, for existing easier And our enhancement, as with commonality and fact, customer quarter process the higher million to some designs of of total which and platform are variety June packs have to for packs part to provided And product UL approvals, now certification in the the a shifts, At And forklift $XX.X as shipments and well, and ownership producing increased our at our of inventory serviceability. on new solve during and to through extra-long is requirements in features increased models margin and challenges of OEM moving improved time, from included response the X.Xx. battery to performance We the new a

lower a chain chain has design million rate facility, working addition burn This this expect needs. improvement improvement sequential I shipping provide as to results, along seen backlog margins. still cash cost strategic turns gross and included We XX with a as continued of manufacturing be issues million March believe Silicon see assembly will that continue continue to shown in implemented signed $X turn, credit ongoing line has traction. credit of Bank supply have Inventory positive to our in levels improved and efficiency, We material million and $X to our declined increased resulted our committed In our on mentioned. million, those challenging, will helped which initiatives with just capital in just approved, currently reductions and are availability. facility recently $X initiatives $X unused, Valley mentioned. credit I lean availability cost we profitability for which of While is by strategic supply processes, implementing production reduction inventory including in gain our have we of

cost achieved are standpoint supply our seeing so execute due we improvement and as priority we our on processes, reaching from far efficiencies Finally, profitability. intense issues an chain of cash breakeven in an manufacturing to top procurement and flow internal focus

already is forklift packs purchases. customer fiscal forecasted and product Approximately XX% and lithium year shipments These continues made of an a their packs and order and we've diverse fleets in with identified scheduling a full to a represent customers we're input to base that seek of received revenue this pipeline provide who for our potential we've now packs. current letter intent all battery multiple customers ongoing their battery to expand caters lower seeking of to higher cost new are line for large basis. a XXXX, on Our reflects in of relationship performance partner with whom segments,

experience has are forklift for new which been battery orders orders. needed our receiving that often Our from their customers precede orders,

gross We our have path. taken improvement actions margin to restore

quarter to impacted XX% improved Slide substantially margin our on margin from supply our on disruption. XXXX, of XXXX progress fiscal gross of in was the recent shown chain gross the third X, in trajectory highlighted in as by that reflecting slide As quarter fourth the the restoring XX.X%

And lower include our vendors that Our now, plan have and part new and supplier a Mexico end, reducing improvement. Asian new gross all key [ph] utilization accelerate margin are price sourced our of improvement steel we including coming strategy for insourcing and recently our a supplier. an of chain for packs, offshore components. number serviceability Part initiatives in on our lower-cost orders supplier new a and of suppliers for To product designs has been to electronics, part to improving TLI supply count new of increases alternate which elements, cost, the complexity of of through suppliers. harnesses

in We fuses the continue been happening contractors a to qualify margin chain ensure alternate that's disruption time. sales, response suppliers for and to resources, of to including packs we critical give on to electronics, us deliver our safety supply and

to have disruptions and record XX, as earlier, in as sourcing backlog fourth quarter is chain improved, customer mitigate $XX.X As from a shortages. to $XX in XXXX, improvement of March actions million million mentioned declined parts I to of due supply the

months. X past part have shortages over the declined XX% by Our

As better contributed well, the improvement. production process improvements chain management supply and to

I to processes. to during purchasing million I March and improve. mentioned -- quarter, production earlier, from from mentioned. as efficient Inventory continued the earlier, mentioned have the $XX.X improvement more supply as to During I reflecting turns X.Xx quarter, decreased inventory due chain X.Xx $XX.X our at Also to million, XX have

inventory in quarters the We are turns targeting continued improvements in ahead.

demand profitability the solutions success including our well related focused industry, on X lines, lithium to which strategy, to from also related as into are With positioned we continues Looking reach our building the broadening to are beyond our energy numerous of continue includes including accelerate, warehouse verticals, and reaching capabilities robotics. leverage assembly in operational our handling we material verticals. adoption

front, very Power happy the these to for On remains June and will With SkyBMS our quarter year pack it Chuck? XXXX. Financial Scheiwe, product, the report management I see for the customer over the Chief applications. I'm in optimize delivers which results turn financial to data as monitoring, telematics that Officer, our to technology battery Chuck and to ended of remote to provides positive continue fleet a customer tracking. for XX, for review that, performance fleet now feedback Flux leader we technology customer which interest proprietary and

Chuck Scheiwe

Ron. Thanks,

fiscal a reflecting June XX% million quarter quarter compared increased XXXX. had in gross in XXXX. actions This our in of compliance Now delivery XXXX fiscal the of by sales support in higher million the $X to compared fiscal significant XXXX. was compared quarter was fiscal to expenses chain million points in as margin testing product to the of past Gross fiscal XX fourth increases to by the turning and recovery fiscal XXXX. as fiscal increase the and fourth timing, to fiscal and during review reflecting selling lower fourth to increased fourth order Selling mentioned, expanding and increased primarily fourth financial previously million decline the shipping of quarter XXXX quarter Research of profit stages. is of in as insurance the $XX.X our expense gross third-party and $X.X the expense our of Gross of compared fourth disruption usage, the This $X was XXXX. quarter fiscal million quarter giving to volume is the the XX% and outbound throughout models of results global prices. quarter Cash service quarter $X.X initiatives to for in supported year. delays in in for increased in $X.X shortages the of premiums. XX margin costs, approximately million to revenue customer we fourth quarter XXXX product XXXX. quality to of a delivery XXXX million to Ron protect decreased fourth supply This the This to of development expenses personnel ended development $X.X administrative discussed XXXX in related million $X.X related fiscal XX% to has fourth with quarter due to our driven fourth from of in profit

with disruption capital reduce implemented to to that our our capital to additional existing working committed million year resources $X funding of have raising worked subordinated to which fund the available the facility Bank, a inventory line credit over credit resources SVB of credit meet months, working XX in any there actively LLC signed caused equity as Silicon intend needs. facility, $X.X ended to debt pandemic currently profitability. us million $X and as capital sufficient We of $X cash be our We capital Valley million anticipated availability which of recently million cash events. is fully $X.X and with recovers. for will is the have We next operations barring to balances with our manage under available We under funding available prior to believe avoid and planned reaching million combined anticipated

control cost to improvement and We are on executing gross track initiatives. margin our

have ended the year The June a results sales Now price, of period. turning a driven revenue our alone, to in existing year XX, XXXX greater in that to compared sold grew packs higher we was and of orders. higher both the $XX.X booked primarily $XX.X increased as new million selling same year financial to In of in revenue of mix customers. for million XXXX volume to review million quarter our $XX.X larger new a battery ago units the combined XX% the by with customer fourth fiscal

While there acquisitions. some of course, with continues, reduction can from concentration new orders, be with a demand strong seasonality gradual customer customer along in

the gross during compared year, to XX.X% for higher profit, Gross $X.X year, some the $X.X fiscal electronic will new due in This ago by like those and to year at Although higher and is expenses profit parts, parts higher certifications. insurance expenses 'XX pass premiums gross it increased to remarks. to in as compared were earlier, margin margins all fiscal compared fiscal profit and same same primarily decreased at to sales period. expenses the to a profit to to period fiscal off-the-shelf $X.X in was revenues million million was by the of million with back in in of related year personnel outbound UL year as $X.X expenses. development to costs in solutions. and XX.X% million costs, now product year 'XX XXXX from our impacted ago increased increases of $XX.X million energy reflecting steel, partially storage common and year associated Selling Ron, offset same the fiscal mentioned Gross XXXX. in I'd Research in development offer shipping he $XX.X year XXXX, and increased closing to fiscal million. administrative

Ron Dutt

We're to to achieve currently As avoid we prior is emphasize our it. it Chuck and profitability. very capital Profitability seriously to raising priority. very, to fully mentioned, I efforts taking very intend equity that want reaching top specific

technology focus on energy storage ahead, to the robotics, warehouse solutions lithium-ion anxious continue Looking also focus applications. are new to into and customers, sectors, as for to we existing and increasing high-voltage expansion emerging of our who on such benefits

own also reduces large for Now customers. our we own our risk technology

attracting a company, customers. after that technology We all, are, for and is great

So as let then -- both large put differently, demonstrate who future Fortune good or their customer it better technology, want me target XXX that. and base supplier companies now of can has fleets the and our with a we

as trajectory, and why continue initiatives, key growth Price, to our X to at. and customers potential. said, have repeat in intent is this customers is are new brought of sustainability great recently future a X a continue ours win major goal that Slide of multiyear management and have we during and business our X-figure relationship shown seen business, service negotiation. these will our predictor and with factors As as to particularly fiscal revenue looked on as by more we quality ensure Fortune 'XX, XXX Further, letter on customers we

beyond facility and manufacturing second positioned in long-term we million given lean well should revenue footprint, $XXX In shareholders. create shift current Our our for build-out are annually summary, support our facility implementation. value production to well

providing flow begin and question-and-answer have hand to and customers. you working related over shareholders in increases, our breakeven been Our with operator our increase and chain we customer accelerating call as further updates customer executing to all list increases I diverse new both strategic to we trajectory order global to in the term to now profitability profitability. backlog. cash And technology and deployed our mitigate capacity forward and continue the With our our for I'd demand the ongoing supply like in with session. are to continued I look initiatives to leadership production our disruptions are solutions Operator? large thank lithium-ion near now growing attending. of leverage position and

Operator

from [Operator Instructions] with the Our H.C. comes question Dayal of line Amit Wainwright. first

Amit Dayal

how In should just months. first that of say to over the fourth next revenue quarter. XX context, for about you the strong want Ron, congratulate future I growth, on think the sort we especially performance

moderate a just or expectations fast perspective a You're sort 'XX? level clip. should for fiscal our growth of of from this sort pretty we sustainable growing Is at a rate

Ron Dutt

Amit, Yes no, good the question. thanks, for

capacity constrained. We are

At we demand go have had that Slide we've which a is time, We same meet, out thing. -- can you that. of growth and build back to which very the more trajectory, infrastructure that resources I to in is can a see fact, support good X, impressive reflects and the lot here of

the control get same and in our grow takes have. achieving we At careful we're of confident growth know, out to you -- have As to growth feel with with continuing profitability. faster the not capital. with We business time, the inertia regard we

we and not to achieve track of with of plan this getting year assumptions. budget specific but far growth, ourselves too also another that We're profitability. deliver that year initiatives have very specific good a with can't goal So ahead very of on we our

as So to existing do in new I'd new adding their increases forward, guidance we're we customers. and see go out But and say don't we that. base continues, the fill we've on customers, that give fleets more customer quarter-to-quarter continuing added we revenue

that -- X seen we those customers. You've those marquee slides on have

the really guidance, managing answer us don't we're these to that. want is to we through believe. good have, give challenges probably So are but for We short

Amit Dayal

Yes absolutely.

the that expecting million are months the backlog even next to in XX have, you $XX So that faster? context, in you or in deliver

Ron Dutt

a Yes, like backlog the It's hopper. is interesting.

the have and but and then orders table that seen -- shipped we reflects in in shipped orders those receive haven't You've release, we we in. the and we've press K got our that orders that it's new the we period-to-period,

as orders time. over from moving customers, because the orders the think times now these bunching from still they're lumpiness it's protecting principally a is towards orders smaller to and There's get their little really we more that the question little opposed pacing. I lead So a large

-- So seen quarter, last we're did that that but the impact particularly seeing we've help? in the

Amit Dayal

I offline I that mean, follow-up on Yes can well. as

Chuck Scheiwe

that offline. Yes we can do

Your quickly. getting We're plan answer We've that here -- out on in pretty flowing place. working through it, yes, well. we the it's and stuff got

Amit Dayal

the of probably we you I June And added since probably end Understood. now, assume mean some backlog can until right?

Chuck Scheiwe

Yes.

Ron Dutt

almost it's new backlog, the yes -- shipping orders the Yes, continual in. orders, kind getting week-to-week almost month-to-month, of a reducing of

is shipping million to you bit. past months, the If $XX bit have a that shipment little out, older we'll manage it. orders continued has new million, typically We backlog more a -- orders been order a X come we've before over $XX still an just look The could level since around the months in. little moving get shipped backlog and that be to been around XX%, be back couple there. a ship we have the quarter Meanwhile, schedule timing and

a is So reason there. for of delay. There level to backlog be there a is a

So critical with the what's we have their customers, but meet delivery to -- our point, timing. to

Therefore, long. let sit So can't shipments the net and that in we coming in. orders new stuff reflects of that shouldn't going backlog out

Chuck Scheiwe

Yes.

Amit Dayal

And second meet you're running this already to demand? a all shift, right,

Ron Dutt

capacity probably we at expand second shift a right or all now. second of we Yes, that lot But packs there first some really some we our to second X people work add a full for want the to also X started increase built -- have because more full a got shift. lot prepare that there starting we X shift. people X do and of in We a well. about to That's not adding or we shift February, actually, help to can as potential

Amit Dayal

having that or concerned want maybe how right in now? may your concerns in around outlook managing of just terms the of sort be in about is last one one of everybody headlines customers? environment that recession-related type filtering just the with And to I Okay. you your you're is conversations see market that currently

Ron Dutt

seen impact is things. say flow haven't to or about everybody far. any Yes, our I'd it. X, X the order customers with so or anticipation concerned we discussions

packs if a It's who -- a particularly handling the of what we're running don't things upturn And you I'd move you're we we up. that other to historical wide to insulated or like from material there, battery that, you like banking to out impact to weaker car can the do fill gas certainly say construction So knows one downturn but like and has forklifts there got don't it say about to really. is in in we're stuff impacts an be -- economy, a future while holds move the and point either going the and a stronger some you sectors see look want historically, stuff's a out. being But I numbers, at in economy forth. are so second you and from

Chuck Scheiwe

that customers are other Amit, might add customers. Yes thing very is I our the large

pockets. not deep concerned items. of So overly about receivables those we're have or type They

more can you got the this. had customers now So those you might concerned handle be small a not we've recession, are customers, if -- about that but big

Amit Dayal

Understood. offline. I'll take questions my other

Operator

of Our comes Moore line Hutton. the next question EF with from Chip

Chip Moore

top wanted back go I to the line. to

rate visibility talked I your just think don't us dynamics? $XX to relative about you have I Maybe about those reach run on near internal you for but forecasts talked guidance, million think know thinking you help XX% term. give the I having about about that fiscal 'XX. in a potential

Ron Dutt

our Yes, see you to look run doesn't take where if a trajectory, of our lot imagination going. it rate, we're again, at

strength revenue. specific, that but would been be our you new continuing. packs a and lot And I'd We fleets. certainly it's give of relationship. not just, kind their anything, well. here the a more our their customers' we that of doing as building way interest practice of we're say customers They're a love I in to We're inertia see terms customers, But guidance for haven't getting just in have in out losing to if growing reasons. is of of

in can you we and what we and for several responsible resources do very grow. simplest the given that that that which our sure we're to anticipate controlling go controlling make think costs in that lines certainly look to and our to I to So rate draw are thing is the trajectory at

Chip Moore

ahead. there. that's Yes, go no yes, Absolutely

profitability, basis And to maybe quarter, -- can was you it to great this Okay I no, see a than the the to the that's it. there. XXX at maybe segue clearly way think that's points trajectory a, basis sequentially? right on a points XXX more improvement focus So look good expand

You talked improvement. continued was seeing pretty about quarter-over-quarter. dramatic That

So several think that about quarters? mix some underway, the product if us and trajectory think over actions of help we about the next

Chuck Scheiwe

Price We've out that help are got play. actions Yes. prices. the in throw on. gross what at into of did bar very some site definitely for going cost to to things going that a than We've package side. orders current something taking We've lower there. increases got of and as Like mentioned, specific this, getting Mexico, we're a harnesses as States. in example, side stuff one on very will the were the pursuing cost detailed that the margin was China do keep just on you very packs of we initiatives backlog it finding in the XX% off we dramatic new materials, the we got -- just an can we There's,

XX%, helps. all plus we're obviously, put So mentioned hope go as place, we're needs but I through this, It's march stuff time, do on that back towards to because this continue we've going it's in that. process. into take to to going we margins, -- XX% always to be the

Chip Moore

referenced? more on the But I maybe helpful, and covered -- large that Chuck on okay. that's LOI timing about coming side it. in is you for book-to-bill under that you guess, the X, that that or that reason any related think no, update or just Yes, an just with is talked I bookings it And

Chuck Scheiwe

and going based October is when a itself that Yes, what orders that we're The is is be to going purchase -- anticipating, dramatic its in turn into seeing. to that's we're probably is in flip what bucket that happens. LOI timing to

we're are instead going and to that -- weighing here big doing be and also shifts. So there's giving here Ron as customers, XXX stuff XXX, it's -- mentioned, of for POs seeing they're

trigger. get PO to it's to how a going kind of is few million for You're starting a

to So some back there's lumpiness of of we've actually the because that. be in than past, going seen in probably our order more

Ron Dutt

with time the and please, same same the orders out deliveries the timing -- time, its -- forklift please principally at of that At spread got has note well because are over those delivery for On time totally out customer over to spread the large as that's can't be time an large out from shipments. all us, good standpoint. like so disruptive given maybe month, a a that spreading given week and operation the even timing really or a

Chuck Scheiwe

Yes.

Chip Moore

just very last one okay one me. from no, Yes maybe yes that's helpful. Oh

talked on -- maybe are onshoring, -- thinking longer how that to of that right out progress, like are with about discussions transition Just I the that that are think, term? expand underway, the going particularly incentives you there? how You about some be

Ron Dutt

almost able very would we geopolitical lithium Yes, transit or all the is these that there's like it's double avoid the just buy term from longer be happens. cost. Mexico, time potential But to to to limited in production the cells risk U.S. in and even and of batteries United States,

built. agnostic to the They how if think those don't you actually the fast factories being going we got time. to truth. know. take news can just you a it's we've the are the quickly. happen, day, reading But going and cells, shape know to the chemistry cell to some every to -- scale the in can't It's we So of I up see build -- the want But pick

we're to so, And very we're -- very going be flexible.

Our at big cost the -- is this the of BOM. CTO our looking monitors all This X/X sources. other backup to is X/X We're it time. a

time. to So response looking and delivery be supplier the at it supplier, very good it's opportunities, cost, very, something for all we whether closely fit, of kinds look

like I good is whatever to environment think the be for seems going evolving. And in happens so, the And costs. it's terms of

increase we the XX%, past -- picture have had. volume, X cost years, is XX% that, gone in had that over that's and and down despite increase that principally Our just ago, about only months our some total the of considering cells a on we've X%

Chip Moore

Got it. all That's right. helpful

Operator

the line with Jim comes McIlree question James. of Dawson from Our next [ph]

UnidentifiedAnalyst

June were demand quarter strong? the comments to. prior the with going that, your regards I'm still about what's down being in can just to in quite significantly you Orders from particularly hoping me on understand help

Chuck Scheiwe

some as orders. everybody there's to I bigger involved it's we're of earlier, seeing it's that, were time is customers there. orders, getting and we're Yes, the to talking delays not taking timing, timing knows build some Part is of in response frequent as And what we think, stuff.

they to book are and their So products more the when out want to door. slots come on build these going consistent a

seeing We've we're where that PO in and process the that pipeline got of is there some significant coming with. is the there's customers of number huge at order up point are showing that. of to that a very point that that we're purchase what we're of leading to So behind comfortable level, that,

think So rectify it's mostly timing, it will I and itself.

Ron Dutt

The just that, a so revenue the most life of more to majority don't lead has batteries. we tied the extended color replacing times everything itself. forget. our else like most of of really overwhelming economy, forklifts, -- forklifts, the our on not in little And packs because new sale timing the to just in the Yes, is

orders our longer going to So are lead or times have. whatever as revised tie to forklifts

our don't talk to long-term overall because of we're having are think when in some all suppliers, our the working as tune all and I So the forklift together guys that -- pretty monitor we unevenness closely can are major see happened. sales the Because we we of pace this changed. pace see with OEMs to

was it's not a -- either. us that question, great Jim. on We So lost

UnidentifiedAnalyst

ago lead customers couple to and a All where might about been, where they hope right where have times to -- let's get are now, quoting you're -- and quarters them? you they can talk would say, you that

Ron Dutt

bigger of Yes it some couple model, the X models ago, -- on we're depends we quarters had than months. out more particularly the a

X move or to packs the items. weeks. so, now to for catching X.X X X of down we're up. They're The or smaller some And X more coming longer-lead months

there we time lead probably that the those lead been more reduction expect call we some last, X has has forward. dramatic of a shortening But times. piece over in So And it, as the go months. been

UnidentifiedAnalyst

a or I'm then And a talk trajectory addressed how assuming at my a margin question feel year? last your margin gross for and I'm commentary, margin? yours gross -- in trying get your you -- about either Okay. level is gross maybe can certain fiscal this just much for you but XXXX goal up. in over a is, this to increase revenue

Chuck Scheiwe

but many to you maybe times, a our quarter. don't we Right, at running look at million do million we've $X certainly OpEx can statements, forward-looking mentioned $X.X

you can get You to up like. to revenue into what the XX%, back look margins needs

on to We're very times have margin close a a getting up here. around order working We are that revenues lot the of hard point. the So getting don't necessarily issue. revenue

at hard get that We breakeven. coming need remedy can get covered you get working have out to we Once just rectified, margin we're and this to back -- a COVID that stuff. those up, that you're OpEx we of issue

do you us math I numbers any fairly can So to easy you. without think giving the

Operator

from Our Matthew the of line Maxim next comes question Galinko with Group.

Matthew Galinko

guess, last lower I sequentially your were quarters. I tracked few and compared to noticed down kind DSOs of

that sort So DSOs are curious, we a strategically and anything just of at specific brought level of those sustainable down?

Chuck Scheiwe

turns, inventory are mentioning you Are you talking....

Matthew Galinko

Day sales they outstanding? -- day outstanding sales

Chuck Scheiwe

continue I Yes, large are -- the to customers. very work these hard with

we them. to with work So continue

have companies that. will give down that lot think to your people continuing I work go warning supply going as on these there's chain come and improvement lot even to through it of program, get we financing, those a an improve though based on on little pay working into payments Does and got you but environment with see the chain supply slower, of it I've a do their going it's We'll It's part to are think to way continue other in to help? with that little. get, tough, they'll continue we're hard. people already there. this that, Toyota will Crown bigger better. are special receivables some -- Caterpillar. where getting We but accelerated working where currently I'm to

Matthew Galinko

on then question just margins. more yes, I and That gross one guess -- was

strategically few results and been efforts in think, quarters, how quarters? over the sourcing that is talking grappling you're already sort to into But percolating quarters? into mitigate around for get see that that And much did about margin? what still the doing I of you've baked quarter You've get done, a few fourth future reflected contesting been we'll the factors much of your last that you've trying of some and with how

Chuck Scheiwe

in, A the than of market hitting less back some quarter the we prices fourth coming terms the steel fourth plate. on was probably in Yes, the XX% have was actually lot dropping. of quarter, what in of

part Does naturally that's fourth of of there's less it only lot help? actively And we're chunk to going that going of was The the on piece lot We plans space would after, that still go than there's actively that quarter. in So happening. after. a a a we're this then it say, I of is those initiatives. -- XX% had and

Operator

over closing back turn like would remarks. call for Dutt to I this Mr. to now

Ron Dutt

to IR to joining results Laura. you and to of than for you, like thank assist. we financial If and call conference to your MZ who firm, our growth. our more answer progress on today forward any you, reach look please Thank good were Group, would you to continuing and happy update questions, I'd each day. ongoing Thank our out of to unable be

Operator

today's concludes conference. This

your this the participation day. You at Thank and may disconnect you enjoy your of your lines rest time. for

Flux Power (FLUX) 23 Sep 222022 Q4 Earnings call transcript