BKTI - Earnings call 3 2020 | BK Technologies Corporation

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Operator

Good morning, ladies and gentlemen, and welcome to BK Technologies Corporation Conference Call for the third quarter and 9 months ending September 30, 2020. This call is being recorded. [Operator Instructions] Before turning the call over for Mr. Vitou for opening remarks, I will provide the following safe harbor statement.

Statements made during this conference today are not based on historical facts and are forward-looking statements. to unknown subject and are statements known factors and risks. These achievements actual by materially results, company's may these performance statements. implied The or or differ expressed from forward-looking those

or factors described been yesterday's SEC. press BK's that of differences in in and and with some such material the could And cause filings contribute release to have risks the

statements. we of are I Timothy to accurate as be statements based are to duty the turn on These now Mr. yours, Vitou, any today, will information the do and call believed update Mr. sir. undertake and is floor forward-looking BK understandings that to Vitou, not of over Technologies. President

Timothy Vitou

second, and as Bill time results for providing I'll arrange thanks, Jim, I'll before joining for operational my updates; you, and up follows: today. the to highlight comments I'll our over third, call back I'll into financial opening results; Q&A. spend Thank first, turn to some everyone, financial deeper dive some our

after won U.S. existing for growth sales those of results. revenue of that $XX.X success achieve one, the three, half of a growth the structure. XXXX operating next to Energy, first multiband revenue to XXXX $X more first electric of BKR the increased expense earnings committed August; each sales XXX% launched of of quarter illustrate our power profits million of income quarter during we million utility growing our initiative, $X.X Department XX with the Operating of of the existing products, days first structure Beginning sales in an had from BKR the than We in increased ago which with leveraging and We're QX contract driving or and with initiatives at of the of and quarter DOE. X.XX% launch end. results So agency new grew least margins These and X%. ways: growth in year. our third million up, can the up increasing financial expense we tripled. in X products; two, of

contract in a The with mobile sites The commenced BK's will related more the contract XX Digital and portable and P-XX of be was in U.S. radios deployed X than year, expires covers accessories, June for XXXX period at June in which XXXX. which KNGX

BK's after Accordingly, orders for totaling strategic approximately Shortly important issued our agency this a purchase million. share. market as an increase DOE of are the $X.X contract energy We encouraging. contract, market awarding the from the significant utilities the part firm overall DOE vertical and an like segment to plans equipment is of

to This with contract and important over sole their customer agency of based excited performance, on functionality a to services. comprehensive We're world-class welcome this BK for this selected products and source a evaluation competitors price. as several and mission new support

accessories. Continuing BK's with or from $X.X with million radios the totaling related National portable for existing was KNGX Center, we products, also Fire The approximately order won NIFC. order Interagency an

for have They in years, As we wildland professional upon fire we're relied for to firefighting suppression proud support products community. decades. have wildland over NIFC been many our so X the efforts and

radios. First, D P-XX more our G our and radios, recently, deploying E radios KNGX migrating P-XX analog the and Series Series then digital to Series

Our extended by demonstrated track record confidence recent and earned that of has as dependability NIFC's in life-threatening conditions harsh clearly order.

order momentum public of continued Interior, for $X.X with sales an approximately service for U.S. existing our totaling After of or agency Department the of million quarter DOI. end, products

and with fourth radios for was This of order was to BK's radios mobile related portable anticipated order quarter accessories. the be fulfilled KNGX The during XXXX.

confidence XX in an clear is than with of DOI, spans this demonstration our more continue extended a to relationship, support We order, the long-standing which are their of combined years. Such us. pleased

many for We to are looking come. years forward similar relationships to long-term cultivating

radio, and our to solutions. announced products the growth model the of P-XX sales XXXX initiative, next introduction BKR market XX, LMR portable series the August products first of and BKR we launching on new Moving the from on in increasing new

XXXX of to communications. responders customization BKR to in safety offers programmable functionality maximum communications of their flexibility tiers tough XXXX requirements most and the out BKR first the of help has needs The an environment. users public radio The allowing X been array tactical the for today's comes and get designed mission-critical meet

extensive to by including with cloning BKR responders, and and popular incorporate by features The BK's engineering designed XXXX customers first the our options long capability. was developed Bluetooth, input needed team from and GPS

display, housing, which top yellow. includes with black an new in and both use heavy for a gloves The and factor comes large control buttons ruggedized form IPXX optic

ease The transition user further and same products, customer the the series. to of easy interface proven intuitive and BK characteristics new current products been have programming the from maintains well current Which use allows an BKR accepted that software in for embedded editors. new

including is microphones and charging speaker BK available, accessories solutions, the popular IPXX remote full battery ever fire and alkaline wildland of battery A intelligent clamshell. line

to and BK's BKR quarter accessories. vertical XXXX share. new address related that market a be to The markets, After is BKR the XXXX and end, were significant we leading for our new ability to significant to platform announce order pleased expected enhances first extended growth

of from month XXXX. because be it order quarter excited agency totaled fulfilled a is within million launch. order We're to after of Tennessee this and about The fourth during approximately came the $X.X anticipated State X

BK Additionally, this is customer. agency a first-time Tennessee State

customer capitalizing on a a promising, look and new is model forward will XXXX shortly order BKR we our to year. the just such next which initial product multiband products of comprehensive after very a substantial new was include early momentum. in radios, a Securing launch line The from new

brings our to products, first next initiative, multiband XXXX. the our that launching Speaking product, BKR of us growth multiband

our BKR half be make The third quarter, first expected believe customers XXXX, During it the headways open will growth launch vertical the opportunities. at XXXX contract the markets in toward years. XXXX. which and markets next the additional We several fuels we a higher is be of point price to larger what with addresses continued in significantly new of to exponentially BKR the and

BKR $X an addressable and LMR. opportunity growth a approximate of To see back, law a exponential organic $X limited for new step structure In release huge products. XXXX billion verticals to. XXXX that take up approximate access enforcement had both with a for and the particular, bit fire the there's now billion has market of the and Series opened the until We BK

updating importance of social and of Given the We focus the progress our of and new on the sales market share weather the extremes, current us additional the safety to XXXX allow BKR quarters capture heightened. the in and the public We're quickly. pandemic, to is look global environment XXXX the products confident unrest of will ahead. you forward BKR

to reiterate, present excited while And is bright. I'd future, about we're the like the

the of expense products, midway growth, quarter with operating structure and and income the growth was through XXXX quarter. performance X% only Third from XXX% existing operating introduced new the the tripling revenue of achieved BKR margins

Our existing, newly to quarter and engines as these results value launched us substantial demonstrate. shareholder and growth third allow create long-term future short-term

This financial over will concludes call review I'll Chief my Officer, highlights. overview. operating our now turn the Financial Kelly, to and the who Bill

William Kelly

Thank you, Tim.

ended for September summary a quarter X Following XX, results third and operating the of months is financial and our XXXX.

million with to XXXX approximately sales $XX.X third X.X% Net $XX.X million the approximately third for increased compared quarter year. the quarter for of last

period million XXXX, sales with compared year. X-month September XX, increased For $XX.X the to for approximately X net X.X% the $XX.X million last ended months

Gross profit with XXXX, a ended the were percentage quarter as for September approximately margins compared quarter the for of third same sales XX.X% XX, year. XX.X% last

compared with approximately XX% X-month XX, gross profit XXXX, period XX.X% ended September same were the margins the For year. period last for

from labor and margins cost Our gross and pricing. material, manufacturing of derived product products and mix, costs, overhead are profit volumes

Gross favorable year, mix due profit with the of compared a less third the decreased margins XXXX product quarter sales. for period to same last primarily of

XX, the resulting manufacturing and For profit support compared the September decreased inventory with expenses. last orders impacted the quarter were first in of volumes with more and primarily which customer margins utilization having our XXXX, lower period program, manufacturing reduction X and during slightly months fulfilled by in concert absorption suboptimal ended on-hand year, been with inventory X-month gross

utilization employment approximately as These combined operations support by expenses. related as other manufacturing and our reduced XX% increasing absorption manufacturing we with year, improved and well this reductions, have sales, Earlier expenses. of

or quarter same quarter September was expenses $X.X of to compares SG&A sales. the for with ended This by year. for approximately the which XX.X% approximately XX.X% million, XX, sales $X.X $XXX,XXX decreased last XXXX, of million third XX.X% or

or the SG&A sales. months September X expenses year. approximately or XX.X% sales with For period $XX.X last the of was to XX% for XX.X% approximately XX, ended decreased which $X $XX.X million This compares million by X-month of million,

approximately to expenses and reductions earlier employment manufacturing our with in engineering in as SG&A we and Consistent go year, XX% in reduced headquarters. the employment market, by as other well expense sales, operations,

Property investment expenses other totaling loss For XXXX, primarily Holdings. Insurance quarter the an our $XXX,XXX, recognized XXXX to on unrealized of we third approximately related in

During last we other recognized net year's quarter, third $XXX,XXX. totaling expenses approximately

September XXXX, months XX, net X approximately of expenses For the other unrealized $XXX,XXX, an PIH. primarily from XXXX loss ended totaled

same interest the and other income. XXXX we gains primarily net period year, For of approximately on PIH income recognized last from unrealized $XXX,XXX,

the to third share $X.XX third of year. income $XXX,XXX last the quarter or increased For per for with share quarter or diluted diluted XXXX, net per approximately XXX% almost $X.XX compared $XXX,XXX

September $X.XX last compared for or $XXX,XXX same ended per period XX, per net approximately or $X.XX share months X the $X.X diluted our share For approximately million narrowed XXXX, to diluted with the loss year.

generated reduced months $X.X by inventory XX% X of approximately flow, $X.X our positive we For and million increasing by the cash first over of cash million, XXXX, XX%. balance or

last has Our dividends October consecutive XX, capital the return one quarterly XX with XXXX. on paid program paid

remarks. my concludes That

of remind operating the do or we we're for a the that the to will move would quarterly We everyone annual call. financial ready portion now open questions. to Jim, now to not I question-and-answer guidance like on provide floor on conference basis. and

Operator

we'll question Ed take ]. And Schulz from [Operator today Instructions] first [ our Mr.

Unknown Analyst

taking on there Congratulations and for quarter good my Okay. questions. the

have clients, on than California I is among pandemic been California clients orders quarters? question clients? with possibly Historically, your first And sales have moved seen country. you or comment COVID constructive the had its on more these the may the been shutdowns sales. rest have that restrictive to longest any effect The have to have of you Can delayed has and ability dialogue your and forward the forward the in of force indication on

Timothy Vitou

COVID of different effects on Ed, This question. a Tim. couple had sales is the you thank has the organization. for

Where is been that face-to-face most a severely has customers. meet go typically relationship. new the build have limited you're trying effect to We and actually customers on with our when to ability out in

a sales customer online able is existing based as long-term a our or As to lot to pivot -- lot been kind successfully virtually calls we've Zoom on of and meeting relationships, and you face-to-face. opposed very of our know, of to

customers, us affected So to hasn't it too really with existing regard much.

or X, on budgets an how that We some what's levels to by they some on where again, happening, learning along county have are do purchase quarter is at lines. something have seen Coast, things have a effect Ed, think COVID West out differently. I those X delayed here But the people

there is handbook. finding You're COVID no

kind are doing walking continue people new procedures to through new processes, of So business.

of going -- since still I'd constantly team one One to the a the may of things there's that those be safety, support remind team me, products first are need. radios and responders, like the reminds it's public critical to

essential manufacture, comms continued we throughout All continued to tactical customers. to we these to business public as COVID, work an to safety our we're supply considered

a accounts, I sales excited that done comes it virtually. individual when in through was forward, talented to Tennessee. to agency announce That we think the were new the very going very

technology of the Zoom able lot were doing it testing put calls They the experts, through were gear. product. to them paces. We a their send with We

sales the was to So -- it but pull off. the the sale team was of was magnified, it able complication

very I'm their of proud So efforts.

Unknown Analyst

that expect come Okay. $X million. to R&D. And And have question it far on down $X year, was going about this quarter, forward, this I we've million quarter. the $X.X is should about Is of averaged the number quarter? type I $X about about so a per guess that's that million, million Last next year, we

William Kelly

engineering about the at trend This is down and using first of been We resources. look external our of a Bill. have business last we we've bit should if We're through this fewer because couple It year, level. plan that -- you be had quarters year year. working next

expect continue. would I So that to

relying team. are almost our We exclusively now on internal

don't probably because expect will I that any but and see its R&D expand team capabilities ramp-up in bit We a that. to of next year,

Unknown Analyst

level Obviously, have that the from your million you $XX Okay. last should on inventories. expect of million. would I getting expect that question brought Or forward? about And $X Is to toward a you down quite then up the that million bit we down type maybe $XX rebound some that level? back is going

William Kelly

No.

modernized the BKR implemented, goes it eventually but difficult KN the to it those nice and intent KNG at levels, to job And a there. the the componentry been successful stay we been that expands very about been could would year, one continues biggest I the could the processes it's it our in challenges it's -- line next years, of with line the Our product product the as during stand be Ed. for and guys keep to bring the -- because of stay -- levels. company is or have goal course We've possible of lower. have and at of away, reduction is products a down. these And done new new That's that more But we to to expect program. company's and bringing the

Unknown Analyst

Very Okay. good.

XXXX. BKR That's I the and on the of have, Okay. all congratulations launch

Timothy Vitou

Ed. you, Thank

William Kelly

Thanks, Ed.

Operator

audience time. it closing remarks. any have Mr. Vitou, our leadership at And to or Mr. back no team our this from for further turn questions I'll additional Kelly, we

Timothy Vitou

Jim, you, day again talking great for our and to we participating look report the forward XXXX. and year All of March all today. all have you a you in full results QX and best with in of call. you, We Thank today's thank when to XXXX

BK Technologies (BKTI) 12 Nov 202020 Q3 Earnings call transcript