RELL - Earnings call transcript Q2 2025 | Richardson Electronics, Ltd.

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Operator

Good day, and thank you for standing by. Welcome to Richardson Electronics Earnings Call for the Second Quarter of Fiscal Year 2025 Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, ED Richardson, CEO of Richardson Electronics. Please go ahead.

Edward Richardson

Good morning, and thank you all for joining Richardson Electronics conference call for the second quarter of fiscal year 2025.

Power Rob and Financial Healthcare; Solutions; General General of are Chief Wendy Greg and today Group; Manager Officer Technologies Manager Operating Manager our Jens me Ruppert, Ben, Green of Officer; Chief Diddell, Peloquin, which General Joining includes Microwave Canvys. Energy & for Richardson

could current playback. we'll reminder, like on to significant also press on this explanation update be recorded filings with strategy. progress and be As to materially of are different. would forward-looking expectations and is a that and an encouraging making will and Please our an our you refer multiyear that growth risks second pleased I being call to for I'm be share release our making statements quarter available our uncertainties. performance for factors. results actual involve remind risk we're based SEC as Therefore,

improvements income and quarter, the sales delivering experienced November. in and operating sequential positive October During we second in

this quarter year-over-year will capital we in operational second during of of to Financial the Officer, the overview, our this over positive which outstanding more Green QX detailed our semiconductor million, provide strength financial in Chief recorded a position. diversified year. business Solutions addition the results solid increase. With a Furthermore, review quarter. the free million, business hand segments. $XX.X Energy underscoring to our wafer XX% growth Overall, quarter, business, year, second Ben, $XX.X quarter our sales improvement in who we In with and achieved I'll ] our compared exceeding the reached during momentum, Bob call significant than last second now sales a We to revenues prior flow from our cash generated doubling [ experienced we fab

progress of customer wins Wendy developments, and and relations. Thank the in-depth expansion now over strategies, our unit business our and Greg, updates our performance, and Following product key offer will program on to on Bob. Jens including growth remarks, Bob's new you,

Robert Ben

results net for XXXX, a sales you, morning. Thank Consolidated and quarter year good review ED, second by cash our review our of fiscal of net position. our for the increased of This financial fiscal I will in increase consecutive $XX.X year quarterly million of prior the was to million sales in quarter. $XX.X sales. compared second our quarter second to XXXX second XX.X% year-over-year followed

XX.X% to Operating million for quarter. offset EBITDA fab year XXXX in press a quarter gross of second the quarter XX.X% net for loss sales second second Partially of of in XXX% due our higher a to rate second $X.X XX.X% EBITDA or unit offsetting product XX.X% was for gross the that million fiscal partially the second unrelated quarter expenses GAAP effective a note yesterday. our Energy was year net increase quarter. Net to for million approximately an in XX.X% of which second in loss is quarter cannabis to XXXX. wafer to in $X.X business. XXXX margin from quarter. Income efficiencies. care margin fiscal in of The tax last million improvements for the result as compared was second $X.XX reconciliation was the manufacturing of was business operating share XXXX margin an quarter quarter Canvys prior to to mix. GES growth margin negative year net by consolidated XXXX margin for of or income increased versus is increased care by of comparable most XX.X% XX.X% across was in to non-GAAP an XXXX. to the of improved program of prior that Solutions breakeven during as an issued sales, or increase any of the quarter expansion due lower and effective million and quarter of second reflecting of or largest compared of demand tax XXXX. Operating or specific second also PMT's measure, $X.X quarter, a growth sales led the because product available of of improved to mix sales year. XX.X% per diluted in fiscal the fiscal million quarter fiscal fiscal release mix. XX.X% was to due quarter of benefit was XXX per Second compared product second XX% of for to point share in versus XXXX PMT second Health basis $X.X gross loss sales from margin compared parts of sales Please primarily XX.X% was the component $X.X margin the Green XX.X% the $X.X improved customers. Sales and gross from our quarter these gross in benefit the a increased tax second a prior X.X% the a increase in quarter rate loss an XXXX gross fiscal percentage net sales health for in of $X.XX XX.X% to the customer sales, lower semiconductor second year tax fiscal was decrease loss. $X.X an versus Consolidated to non-GAAP financial diluted a measure item and margin fiscal improved X.X% decline was in the the of million second

months fiscal for net X of our first the XXXX. Net across was the Gross $XX.X for except X.X% months fiscal year unchanged year first review higher X of fiscal segments XXXX, the XXXX. was results to $XXX.X XXXX of the for from year fiscal sales increase of an reflected sales, which were X margin months XX.X% first of the million of first months in X business Turning million, Canvys. sales a of which from

year of Income of XX.X% X first As million prior XXXX $X.X loss sales, months. for first expenses months of year the a company months $X.X to fiscal benefit net XX.X% million year fiscal first XXXX as versus of common prior X was diluted in benefit loss or X of per first fiscal operating fiscal months of a tax for $X.XX income net was first $X.X The year's million reported of share $X.X X or the share months months the months first $X.X fiscal the tax the X XXXX loss the for X million for common the XXXX. EBITDA XXXX. the $X.XX diluted XXXX first first an per of the fiscal first operating for the net months $X.X during year's compared loss prior fiscal X X of X in first year. Operating was of for million compared year $X.X of for of versus year of were months. percentage $X.X million an million X the versus months million the to fiscal

Capital to XXXX. Operating $XX.X a year fiscal the of primarily our review the $X.X IT in second of fiscal second cash our was million quarter expenditures XXXX. to cash million second million to cash Cash second the were compared $X.X first of $X.X fiscal at to $XX.X of end systems quarter. quarter facilities at related million quarter of fiscal Moving This position. quarter XXXX the $X.X flow prior the was consecutive end million of XXXX of equivalents compared were third versus in of the of in and flow. quarter the million cash and positive operating the year

second the result, We XXXX. free million XXXX. paid in of a quarter As cash fiscal was for of million cash quarter the year in $X.X $X.X flow second dividends fiscal

a quarterly common current of share, paid cash dividend Directors our quarter our of will in declared fiscal on the based which regular per of position, addition, In XXXX. third be Board financial $X.XX

outstanding of of $XX fiscal As PNC on its the XXXX, of line debt no credit the end company Bank. with had quarter revolving million the second

provide Now call GES Greg, the will our and to details PMT I for groups. business will more turn who over

Gregory Peloquin

morning, Bob, you, Thank good and everyone.

growing is both see As FY long backlog to in and new growth increased the over recent both development we we our $X.X our our in grew are stated transitioning GES continued units, to had testing in 'XX, 'XX 'XX, to and was Starting including business the since in our and we strong by this several have PMT term. and in it calls, GE XXX% growth FY out this The and FY introductions customer in business. short Coming bookings to future, report achievements over numerous sales on we QX of sales positive backlog, strong them development million. pleased come a optimistic and fruition. manufacturing remain of semiconductor very quarter-over-quarter product Many QX. prior programs rewarding have momentum, expanded XX% FY growth from wafer beta base year-over-year by preproduction. Building to and 'XX about GES been and strong enhanced fab quarter equipment business. with in strategic

exclusive we and wind Our we and Invenergy, and America, pitch the RWE, turbines with complete owners dozens including operators. in to new X operators owner partnerships other serve as specifically key top modules energy add NextEra. our continue turbine share testing and of GE gain market customers operators, products beta Enel momentum and of with North owner wind Today,

Nordex and Asia for other this such turbine continue and we into Susalon, grow Senvion, Additionally, platforms products and SSB. expanding to as Europe program globally, with new GE

partners. of demonstrates establish As quarter process global strategy. a a energy mentioned and in received growth and multiyear built In GES is our business quarterly in previously, industrial scales. we of space. stream the This and focused several performance and more time, green designed believe have positions to second we revenue our power short large our We strategy growth customers applications booking on multiple predictable GES leading products, benefits GES the base our patents growing management us have a

management strong continue in our to GES applications. Additionally, customers our core highlight power market our position

to pipeline Our the as support we as wind opportunities energy grow projects. numerous capitalize repowering such significant transformation continues global turbine to on

Technologies which wafer Group Power Sales were prior to Microarray Tube million, Electron or X.X% year. the Group, includes fab Group. business our equipment compared up the PMT, Device Turning $XX.X & and Power to legacy and semiconductor Microwave

in We components see growth continue our manufacturing customers. fab to equipment our semi and microwave and business RF with

PMT $XXX GES to as strong million Our backlog remained combined increase an and in QX. over

as technology key stock we the our of remain of our our business from base. focused incoming A partnerships. maximize selectively we Given expanding to on many all while did growth needs will is customer global our position, orders aspects profits of expanding managing We inventory to our component quarter. last ship meeting continue strategy

value We and new for we opportunities provide and strategic products technology our gaps offering the Through test allows add capture new diversifying manufacture us to This more continue customers priorities. we align often our who revenue that our with growth to we identify and and while to we our approach customer these in partners address in-house. partnerships, enhances design, base. expanding

extremely we partner and strong purchases appropriate, component technology new are strategic collaborate on development, Our when relationships long-term and planning.

investing capabilities. enhance support are includes our field hiring our and engineers design We manufacturing and design in our growth. to This infrastructure talented to

design, teams in-house engineering job current an increased product products supporting growing manufacturing and Our and for demand doing are designs. excellent new

will we Our new to and and identify are opportunities. With team businesses. QX, opportunities customers our GES the green products about into developing keep PMT identifying, innovative within engineering Heading microwave introducing FY continues field applications. management 'XX, and we technologies for energy, power [indiscernible] and excited this and team,

semi-fab forward. a business bookings and QX positive in technology our 'XX. see As from global 'XX growth are Key were in support customers partners market. strong I our extremely in our GES Microwave IR we continue forecasting driving FY to model, FY business our unique SBU, And GES outlook our in mentioned, and

optimistic many and we the be reasons business. pursuing of about future growth have the We to are our strategies

go-to-market the us management, microwave unparalleled markets. and and and Our in global green strategy power capability RF energy apart set

I'll The arise. combines a us and maintaining customer partners our over new has developed By they turn stronger products evident as that This and Wendy products support it of from that creative our steadfast never on our with we have ever. And and than engineered customers, opportunities We strategy and a and more discuss competition. is on to Healthcare. Richardson our model global on solutions technology to Richardson partners execution Diddell aligning capitalizing excel, model that, ES to been legacy our with differentiates unique to to continue Electronics capabilities, rely technology deliver growth strategy focus business base. customer

Wendy Diddell

improved driven quarter a to decline. the our Thank prior of morning, you, our MX, Greg, margin QX. to year, on year. Despite production gross was good parts improved and Stratton second last product margin in the and $X.X program Healthcare in generated the the Z XXXX, million In XX.X%, period experienced in absorption CT XX.X% We and repair sales notably drop, everyone. sales, same All a lines lower and sales. the Tube reflecting year manufacturing higher XX.X% up fiscal strat product of compared MXCXX. performance maintained division year-over-year growth tube steady mix, favorable and MXP by and repaired XX.X% for This advanced from

Although expectations. life the fell first Series short MX of tube

quickly life keeping to allowed and us restart are the our expense team the than year-to-date improvements. margin, fiscal in later this less This us engineering year. isolated disciplined Our for December, and problems losses on gross management testing track launch year. Through an improved implemented prior

Canvys discuss to care profitability are the pass business. I'll ahead, Looking the enhancing exploring and health committed Jens now call sales we to for to while options results Ruppert strategic

Jens Ruppert

a in its million to high-quality custom mission original across the to million level challenges headwinds. indicator from the impacted some Canvys Business May everyone. customers' deliver second remain good conditions fiscal and for quarter, the Index, of to December second to is The we in facing the in sells currently dip of needs. Net decreased in one XXXX. to ability to a medical our points fluctuations. displays second our XX.X fiscal temporary due November, in industrial Wendy, quarter related confident resilient our [indiscernible] global, IFO to tailored markets. marking Nevertheless, dipped of and and our in economy, these to markets. Despite German engineers, lower lowest manufacturers manufactures equipment X.X% $X.X The compared macroeconomic economic during sales XX.X Canvys reflecting morning, XXXX, key Climate markets solutions since XXXX, $X.X core quarter sales navigate European are

quarter, is our end million On Canvys to $XX.X Xnd note, to providing products place fiscal second net quarter challenges by environment. economic in from of at difficult and percentage XX.X% freight highlights The period, backlog fiscal represents positive XXXX our costs. the to increase the a in at stronger of during sales was this $XX.X adapt customer this XXXX innovation and a as XX.X% and business. fiscal fiscal the customers XXXX million to focusing same While engagement poised emerge global a quarter robust in foundation XXXX end of grew margin Xst future increased for compared trust the services. Gross on largely of due the our the

exploring margins moving actively and improve our ways We enhance optimize are efficiency costs forward. to to

the customers orders medical During Canvys repeat quarter, applications. both of from secured first-time and OEM for a variety

continue Additionally, applications. our to solutions and serve commercial numerous industrial

passenger as enhanced machines. products systems and within milling our HMI, and human instance, trains technologies used vending, in printing, For as information well buses interfaces packaging machine

position connections and are strategic market. to elevate opportunities as the in by designed a player we us customers, Canvys Our potential visibility fostering seeking and and initiatives to with new growth sustained actively leading drive aim innovation.

markets, in a stakeholders development We here fostering our players are our economic are to conditions. and customers to primarily new industry recent cautious European to this challenges, supporting our these to with inventory directly as Many collaborations adapt Despite remain presence. and help in we to environment. taking they approach product we them and market strengthening succeed management continue engage and committed

encouraging we ahead, a the reinforce steady improving markets. are cautiously recovery Looking stabilize, demand conditions about optimistic as Positive feedback. suggest indicators customer North in American

implementing on ensure our strategic growth to to teams focus give Our sustainable long-term value and plans dedicated new I while continued explore opportunities, sales to stakeholders.

implementing back long-term now team our ensure plans to to Ed. the opportunities, growth new sustainable shareholders. I I dedicated value to for will continues focus turn over and a Our they call sales have while explore on strategic

Edward Richardson

QX be would Thanks, a Jens. knew challenge. We

supported in the third Despite our uncertainties Canvys the political our to nice see steadfast to in backlog. remain we by return ongoing change it's the to and strategies. to quarter, plan the in in global incremental growth growth long-term growth However, in landscape, commitment the

management transportation Green like, we'd in helps sectors. Shipping present and expand with deployment capacity, still partnerships wafer At Our flow than taking demand energy, and we're expanding customer fab our opportunities continues this seeing and longer deployment business approvals growth and our driven but are our our time, in power the inventory are customers these a semiconductor increased AI basis by business, assembly efforts Energy advances global confidence in XG exciting improve solid the momentum and data semiconductor same wind to on semiconductor across rising strategy. margin. support fueling gross from multiyear Product regular cash growth. strong Solutions orders our to of an is vocalize center manufacturing pipeline

While coming market, support investment Energy wafer resources in semiconductor we business. to the Green the provides growth the sustained quarter, equipment Solutions we visibility have our needed good fab in anticipate which for continued this

disciplined leverage continued balance us a Electronics, sheet levels everyone now optimizing and operating approach remains on questions. priority. to to inventory top continue These updates our We to your On Our thank generate to support. of maintaining progress, we're managing sales to enable forward as grow. expenses, look your sharing Richardson a for happy you and answer will efforts strong behalf at

Operator

[Operator Instructions] of line from Our from first Sidoti. the Anja question Soderstrom comes

Anja Soderstrom

It orders, on ship the I'm with as wondering with like second recent time are the here. the congrats just seems what And those within? frame a you turning pickup half. expecting quarter to you are out in multimillion expected But

Gregory Peloquin

shipped we've throughout beginning the ship ship. we've started Can calendar you already but those balance those it The me? Yes, at December. hear to already year to of of was started contracts, products, XXXX

So it great. will be along

Anja Soderstrom

turbine for non-GE right? were wind the pitch And those modules,

Gregory Peloquin

operators owner that but wind were the mentioned with press terms GE combination -- platforms. a the orders of turbines. from Well, bookings, in there the X of release largest of turbine for overall in both are X I largest

one new customer, and them Energy, One the is was other Excel of RWE. a

Anja Soderstrom

follow-ups a you are there Would be those? And big potential with Sir? how penetrated for

Gregory Peloquin

Absolutely.

million shipped $XX the the to dent Ultra XXXX. of the numbers the we opportunity. We X even haven't that's fact, put a close see, we and things into In

continues it, thing This number for customer continue. they is fantastic out, end wind turbines. One the do then pick Phase I from of program. a which they'll rollout for all until do XXXX, yes, and is farms. they another So of another large to most they've it of really the the was expenditure their do completed order this is roll at of that want capital X what company add, repower is They

when if materials for it new bill apart which so similar listed repower make everything car is do a took you are entire to on and this And replaced brand is we wind where a of the turbine, they it and their again. on

And so materials bill XXXX for expedite should the and of the Richardson of being listed on the the Altra multi-brand. sales repowers growth

Anja Soderstrom

to come in just Okay. in to other near could just that more. the squeeze going you you Can And one term? think to some I'm talk opportunities attrition

Gregory Peloquin

programs Europe. We introduced working The traction, at end the in the QX on and getting in Europe. multi-brand. Yes. that both Asia we're That's of

We ESS going the number our in wind a of of finalizing We're in with have modules, strategy. testing turbines. on process IGBT also our

And that to products be today, and aren't of in but so the are to have batteries, work designed -- they acid in support don't and box. just that not these these battery it's lead entire replacement exist system, customers'

system forward, large team and It done owner-operators making continue engineering have weekly work takes product within all the some programs are moving moving time. has But job. and the So those with and their forward. fit calls biweekly to great we a

very positive. So

Operator

Northland of the from Bobby Brooks Markets. line Capital comes question from next Our

Unknown Analyst

were as prepared second to benefit mentioned in So new remarks a press the quarter. release, the program wins and the

the Or multimillion-dollar those some So on know was I hoping where of those buying program customer and a from kind time maybe Ultra secondly, occurred like Are benefit? was some it a and wins get the release those are why? it I those more earlier orders. to be is more smaller then expected of a just new of for XXXXs project? press first just to -- color multi-quarter wins for

Gregory Peloquin

of to America. Yes. X We started mentioned Today, is them the customers. I'll customers. over share. of always a And selling past of couple bookings we continue again, over it, market I've years one XX out we're cut to side gain the new the things on North with in of large their

the so were -- got approved doing customers we approved engineering. capital supporting quarter. And a job they it, and bookings expenses that And got point with, of by view, they great were from second working They order in then we placed designs. did we the a their

larger So were the I on orders customers. press we release it's the new But did like Ultra that the XXXX. with mentioned,

Unknown Analyst

Okay.

was confirm, so those of the And program kind there outside centered of Or kind just wins really of new to within are turbine anything opportunities? that?

Gregory Peloquin

was of majority The turbine it the application. wind Yes. in

Unknown Analyst

up then were growth. tied release mentioned a year-over-year Great. just sales year-on-year to it on tied incentives Okay. was XX% to kind basis. sales compared SG&A And XX% up The to that of press was

see I'll up So increase I'm SG&A similar going X.X% at out just quarter, forward, first similar a continue going SG&A in we to if were sort X%. just rates sales to trying pace add, up was growth and to the is and

to get trying trends a just So grow. feel where of as SG&A like sales

Robert Ben

you sales Bob incentives most pay low. quarter loss quarter of ago, the really Ben. due year to There and any as didn't sales then. a in a tied increase it's the the the noted, to incentives the was were performance In was due Bobby, growth. large Yes, to we out second the

improvement an period, this with X-month the increase quarter, there. there So was the over

expect sort the growth, X the on some next quarters, but I in Regarding that going you levels we mentioned not sales XX%. of increase an based think the forward, at upon again,

Unknown Analyst

notably? So it growth lag sales will more

Robert Ben

Yes.

Operator

for One question. next moment our

Our from comes of Davidson question next Investletter. from the line Brett

Brett Davidson

couple the can shipping One locomotive family products? a questions. time provide sunny diesel on quick of the got XX-degree Buffalo. guys an From I for you update is, of line

Gregory Peloquin

And one. there. they're their testing get working Yes. customers building ship. program and is major obviously, them over and locomotives that shipping we're the then to end expected up their million product It's that's the $X on QX X at done of and to taking The main to

QX. is have So scheduled on end of out, shipment a the going we electric which locomotives, to go large at the out

Brett Davidson

Are the modules those or [indiscernible] starter battery

Gregory Peloquin

electric the locomotive. that's No,

this to electric X,XXX this ship. year, per for X forecast those just and us started They then for their have So quarter and calendar trains, start locomotives. trains shipping diesel gave Those it's XXXX, the and and throughout starter we'll X,XXX on modules train.

Brett Davidson

on you kind you dollars, million of Wow. the million, of look And in through the million. the $X what at year. Are the a we color of of drawdown course -- the provide Kind $XX during like inventory that looking of can couple year? course does can

Robert Ben

it's less Brett, as I to significant to sell third as what in in and the down a Bob there'll to have we've trying expecting it Yes, quarter, growth management. there. and Ben. going said, some inventory inventory, was in in be We're bit second but the QX for forward, to And little due hand. a and to But the sales be you quarter. products that's fourth bring improved know, We're we're expect we have going on significant. an and I sales, bring increase so but think QX that sell don't shouldn't some growth, in

Brett Davidson

Okay.

a the drawdown expecting of of portion now not track at it year? course of you're the to during where that is remaining kind the So

Robert Ben

sales. drawdown a with Yes. not Probably increased

Brett Davidson

it. Got

Robert Ben

But again, significant. not a

Operator

Instructions] next Ross of Our Partners. ARS the Investment line [Operator Taylor from question comes from

Porter Taylor

showing about years you ago. Is Congratulations Quick. could first than you've playing they significant better particularly at half of running that customers you would scenario 'XX, the of levels think? expect or equal and still are a your that on half related to progress outlook for having 'XX, second equipment making. calendar a few you key your second past, out, peak at be that rate you space semi-cap the In talked run as guys the the indicating half saw

Wendy Diddell

our should now, like seems that Ross, to not numbers it But have we I hearing the script for meaning for to for the QX, the they're challenging is They closer of that and Right it customers are we mentioned kind look their expect good more in this drop anything to example, a little the that, visibility time. think just off. contrary again. a telling the visibility the for on We're cards -- that, us beyond good. keeping not increase us, vest

us can they tell we right fact, momentum they of to matter tell going. us a -- can now. That's the As see keep what

been and our we see has news our in in quarter-over-quarter to demand. bad no us, So to and given revenue increases continue

Porter Taylor

a confused of times Great. wind see adoption they and Okay. people steps I the new implementation for or business. slow on at to think is Great. today. understanding your moves your about even really rebuild call turbines that It's comments get might that And very play, market aftermarket, lightly that my as you turbine penetrated made still this being type or refit, second, you're negative an and business,

So new wind the the if of shouldn't that the President-elect really President next if the -- have impact is U.S. several in following were the adoption that -- case over related significant or successful on turbine where wind business turbines years. a your

Gregory Peloquin

correct. Yes, that's

ones. most before, Again, products wood instead cars. buying also people I mentioned of turbines Our as which turbines, today. to now the new go existing like into And we've started participate in repowering do, women of

turbines effect will if on those. out in -- or business batteries shipped turbines the our lead focused and next no over new next is couple being over a acid wind have years of of that the the because there's wind getting decrease So sold existing

Porter Taylor

you X sneak your for regard do quick stepping of be the your the inventory X or inventories, where to with business. Thales with if to And can tubes X of stand fact up building I and Great. to that out cover regard will

market. And which the we stand stop the of I that or achieve In steps either would cash think, the then some with space. imaging be level up idea I ask you the where the from that question monetized. a would come its whether be its quantitized, basically a regarding move to on on going overall needs take fairly away comfortable and building a that's point wanted And own portion, need talked move flow medical second do to actually, is them into you'll swim and able at probably quickly to own just those my assumption past, inventories. to fairly or been building you point, you've will is about aggressively. regard to to become where be you're eventually, to significant your it able It's they at You've as to

of inventories So as percentage imaging inventories as calls and overall related medical [indiscernible]. a the

Edward Richardson

Sure.

had now XX that As agreement we've back as years. is Thales far about goes with concerned, an Thales

on were TurnoFrance, our agreement we that to very the agreement Philips, of manufacture so we made to and year manufacturing they a in the and from a And The million identical come. those years next to are made has manufacturing $XX theirs [indiscernible] with over products. successful decision products unfortunate in -- in is X products going that do part those we that we X been it's France a Thales or consolidate an facilities acquired exit

it try in us move and to to so And equipment to a to that sources. belongs us other position technology puts

a seeing start the going that, off they're to meantime, in inventory, in it up very now which to Wendy, So discontinue is and level we XXXX? built substantial you're

Wendy Diddell

Right.

build, year of the end at We of more have X inventory December. end and Ross, that will

Edward Richardson

those they tubes So France and Thales. substantially looks closed see X will And like a I business -- are a and so can took tell you situation sources, are $XX it inventory. in that forever. you'll to of go our continue worth like tubes lot wine, we're last we and that that the although They buying sell. going moved in a when in we inventory fine of were of vacuum other sold inventory, those as equipment similar to every and to tubes move We down we million to had

to other find those going sources for problem be to trying tubes. Our is

Porter Taylor

you're the qualify Well, the process I you assume attempting discover and or of who people those in what be. or to sources are to going Okay. have,

Edward Richardson

and relocate we to I bought a operating get year Yes, sometimes divisions to we mean and takes it equipment could takes companies, correctly. to year that's another over move them X but it correct. here, different it XX

a massive So project. it's

Porter Taylor

guys that Okay. continues as on are you in like forward side and But the small just on the to in revenue the it a sounds business EPS the of passed. hiccup of top roll quarter and spite expected

Edward Richardson

the we've XX in as I acquisitions, of mentioned, Absolutely. mean world. over companies I made

times. been we've So through many many, this

Porter Taylor

Great. Yes.

Wendy Diddell

we and we Right. are improving. factory focused take as of business Ross, absorption discussing. the the been the improvements. running improving very risk second unit. indicated, tubes margin is we and are at your Healthcare let as is making that business gross additional the question The The on we've introduce being regarding we've And vague, me

feel still So money, and we still we -- is good alternatives. the we business other exploring It about here. losing are are

Operator

Capital line Brooks the from Markets. from of comes question Northland Bobby next Our

Robert Brooks

directly Just wanted $XXX back one, was I jump a the million get million quick $XXX then for trying so so from line think backlog assume into P&G revenues? is -- I inventory? just me real second, in than is mentioned backlog nuanced of right will on drawn sense to that that ask and backlog, turning more -- And much that it that? to of, be Or to it of of time that Greg was

Gregory Peloquin

in for that based And backlog scheduled currently on A backlog the GES, when they're the of for going us But over lot and that's number -- the and lot excited it's growth breakdown and months. hard again Wendy the to is new a some they've new a of have million. is that time. backlog, given outside QX. is in the what products as a shows ship technology. with give PMT X And longer scheduled to us they $XXX strong visibility to for it. that, is QX of take next then what X new also period Lam And we're about combined that. kind don't On so don't of that backlog at out looking about and of business cases I so mentioned, put

Robert Brooks

-- lot is is say, and and Or shipped the right more, a it? you -- is now then go lot it saying, it them But away? the then to backlog of but that you want -- shipping it they correction "Hey, that we million, and on a and for go thanks "Hey, want into make out just we of Okay. $XXX get and so is your produce inventory it you're now then and tapping

Gregory Peloquin

a the scheduled. ago XX-month are times based nightmares XX out lead Now cases, long having give where on you mainly most months And just the of MRO to in people over other than weeks. backlog business, going things schedule, our still XX are they is most

of a and giving I and on at XX% before schedule. is to recently in cases, is months. the about looked that And ship So it most specifically the meeting, side next PMG Board XX XX-month people the are it orders us GES scheduled over

to strong. book-to-bill our can grow be and you is continuing However, see

current and registration We stuff in design lot every single some a wins, register have it QX, design at we QX in kind we're opportunities. we'd over we get of we got design hundreds of a seeing look that track where We stuff. globally and program working of And on to thought we're fruition.

we've over for But and today continue You just XXXX. they again, of in orders manage the that XX% XX% of of bookings going to the at scheduled will about backlog of that obviously, issuing grow. couple months XX rate which are, ship we're business. past that's seen the the kind last quarters, And getting if

Wendy Diddell

those have those it's in cases, Bob, in because question of be ship stock raw if do And part will the lot was built. Ultra it's of that inventory products, used. XXXX, that we If other from have already we his a will materials

of a and go the So that of orders having XXX% us components it's matter to new for not out get. we buy

Gregory Peloquin

we have make kind the customers care sure of support due inventory that's with seen take customer. go in don't to built through, we the that's visibility, we to we you've have so of manage it our why able we're a to but lot of up this position, year, especially our inventory tough stock. from majority lead because reduction fiscal and And No, process times, a shipped a

Operator

Odenson from Partners. from comes of question next the line Our Rim Andrew

Andrew Rim

can GES? X Greg, then PMT Nice and the you quarter. detail also backlog give the on in

Gregory Peloquin

that It's to scheduled is the around XXXX. right GES, we've grew as in and $XX within just substantially. backlog all talked million, about backlog ship Sure,

which microwave our side, kind PMT X that's our business MRO $XX the and RF That's and On million, it and about legacy components down. business. is of breaks how

backlog to up $XX the it balance So PMT. GES and the of million, quite has is grown substantially,

Andrew Rim

the and is million, was portal that's guess you Okay. million million, $XX if million. $XX and just said you I PMT $XXX GES can is $XX clarify

Gregory Peloquin

Well, yes.

So right now, is it's -- I is documents GES is bunch $XX of million and the balance a of PMT. that, got the [indiscernible]

Andrew Rim

inventory you Thales. current I the the the well, good. All that that talked I related -- earlier Very question to to back balance. go is And What want on actually, right. then to guess

Robert Ben

million. $XX around It's

Andrew Rim

Okay.

similar last very quarter. the to So

Edward Richardson

about That's right.

Wendy Diddell

increased Right. [indiscernible] an we yes. were at

Andrew Rim

then want Okay. I And go to back.

said to million have previously you that that I $XX or the think up so. you [indiscernible] may Is still guys add

Wendy Diddell

you're think that I have No, we inventory. about $X what million Thales in asking? Is left

Andrew Rim

In terms this purchases of year.

Wendy Diddell

this in Yes, $X million calendar year XXXX. about year

Edward Richardson

And $XX of that we're year selling inventory. million over a

will deplete. start So it to

Andrew Rim

that of was guys you said the that kind long-dated previously that thing. inventory you I would that, had thought Yes, over. that other was it Okay. sell

I X was doesn't but think the commentary what years, you're saying over that today? remember that like I the next sound like

Wendy Diddell

years said first we X X was when probably years. now, it So it's

Andrew Rim

Yes.

the this positive quarter, flow? -- AP here, Okay. far AR I nice maybe at driver. guess, look you allows more flow. to lastly, But have fiscal the so 'XX second a year, I it From on cash in the kind continue cash was you nice the guys what as is what done -- was this And half big terms -- key to case, then a up of the put you of mean, just job over in of

Robert Ben

year course, accounts grow and we to management sales continued Well, we second of that in receivable, of due in the but expect the of sales, Yes, tight help. pretty do increased earnings increase half inventory would with good turns to expect then, and certainly the do a well.

around XX Our DSO days. XX to is

do we're to what continuing doing. So

Andrew Rim

Yes.

the go down. kind should what first bigger of the kind and half of thinking that of the with of versus half lift I is is was mean up of the capital the sales capital drops profitability of year working that that's kind kind just in in I and if the So working driver it, second profit stable, then then the year?

Robert Ben

I think that's correct.

Operator

from of from Davidson comes line question Our Brett Investletter. next the

Brett Davidson

Okay.

[indiscernible] XX-degree without Now it's Buffalo . sunny any

Unknown Executive

wave, heat a Brett. That's XX.

Brett Davidson

registration So program by design I'm products. for new that intrigued

said I seen? does those to this me compare you now. How give is think or currently context that ago, from there's last this what's standard increase some X XXX year that normally fair? huge of of years a is over kind that you right can Or

Gregory Peloquin

if that's a implemented identified, field the document will, the they on register, you number, for This years the every And opportunity management that many, we've our and organization engineering part that sales quarterly application, Yes. they it's here our customer the reviews with team. or system. forecast, is business they're many, data and and ago, program in that on many working product that's use quantity and

every as and list year. every we products And new new year, partners, and so as technology add we that grow add to has continue

and one months. that management percent opportunity document thing it's list, and used the to that we've sales the to is and every of lost a be next because, rate add again, about and you a every which, I in not this of know, detailed well that's booked guess as we can conversion over focused XX% of X decade, But tool get system opportunity has more kind type of very of they to that a for a norm. Our given so on that today interesting is it's XX% marketing on will

XX%, XX% to XX% XX% to number the XX% XX%, take And what it to XX% XX%, on get you have a group that XXXX, greatly and So that I that's -- before, put helped in XXX%. well then we on that like us does that we to and focus to North have sites testing. different alpha manage XX mentioned beta just our that opportunities. generate talking to, Ultra testing, we're America And over with

So every that's has more a XX it's program use of our opportunities I ago. track -- and that we software years about globally to came since back quarter grown

Brett Davidson

energy? past was driven is So And XX% years, over largely the this and now green the by something XXX%? X it at I mean, like we're

Gregory Peloquin

number. partners, working of give that to right the I'll is team so it. be now the the don't you, No, or side the the get RF hundreds the on. And globally exact engineered Brett, Yes, number component Anywhere call. Greenergy, a years. then of growth we you is have can that and and solutions that It's of side it technology over it. I it and you give I'll microwave. have

Brett Davidson

I'm mean what's just tilted I the it Or Is the green business-wide? yes, And increase? factor curious energy? it is driving on towards

Gregory Peloquin

terms sell. like to suppliers you When both products have looking green engineered the and products more Navitas, new more to products introduced. energy because we are a generates toward of of percent, agreements, these the opportunities world-leading generates the right like that component majority you products. you've opportunities green like component own these then is tilted signed increase at Obviously, more technology seen applications, It's have it releases that said, we press because and sell is, of more the our solutions you in now, energy, it number

Operator

remarks. would time, over now I like this for closing Richardson conference to to the you. Ed Thank turn At back

Edward Richardson

joining again Electronics. Richardson us you today. We for investment Thank and your in certainly appreciate interest

to quarter today. for we didn't to forward call to happy results ongoing individually and that we look you discussions at much. to in welcome We're And April. our our you with cover any sharing questions third time. us You're speak you Thank very

Operator

for concludes participating. today's Thank you conference call. This

You disconnect. now may

Richardson Electronics (RELL) 8 Jan 252025 Q2 Earnings call transcript