CVV - Earnings call transcript Q4 2018 | CVD Equipment Corporation

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Operator

Greeting and welcome to the CVD Equipment's 2018 Fourth Quarter and Annual Results Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

We will begin with some prepared remarks followed by a question-and-answer session. today McNeill, Len Chief call CEO; President the Tom and Financial on will Rosenbaum, be and Presenting Officer.

website Relations We release have of Investor and press our section call reply posted information to our at www.cvdequipment.com. earnings the

These our I conditions market many the risks statements that and expectations during market, growth, and uncertainties forward-looking XX, XXXX. are are statements, total the this subject the comments remind limited to to described a may and filings related for call section of including results our today's Actual risk in available I'd those on to products, number on future based SEC release for materially of Before business of press certain begin, the ended but from projections, forward-looking XX-K and you outlook. and like those not and general call. made financial are to, demand performance, year our December with differ including, described in factors assumptions, our

addition, today obligation and made forward-looking revised we as circumstances expectations. all of statements or no update any to are undertake forward-looking In on based new statements

turn I Please Now, over to to call begin. Len. would the like

Len Rosenbaum

from the our base, orders offerings manufacturing of that order our in and new the customer that large the develop the done years strategy the aerospace delays thank our quarter expand everyone, of reduction This reduce quarter really variety capability in a two you We our backlog This technology due to our CVD can afternoon, The uneven of joining a product level revenue to a equipment using fourth and helping CVD's uneven materials to on the highlighted and risk Good embarked be mix experienced business. was a levels for reinforces occur. completion in further flatten customer will call. ago sales customers equipment by results. as and second earnings will XXXX as thereby and diversify of to in number reasons. which well grow our for general year of capital and

We we patent growth markets will end, fluid a aerospace, high do in key recently this and sizeable new is corrosion a medical, a coatings. filed reactors. market. into defense family To of global for provisional tapping this bypass resistant, target for One cardiopulmonary novel surgery, margin by

to surgery. blood our can from effectively used believe are in we which Specifically, cartridges be oxygen membrane materials remove dioxide during technology used to oxygenator carbon add

of corrosion customers We Tantaline also use to have products. resistant test material anxious generation next our and

MesoScribe's and addition three will are increasingly to recently for product believe application development. government in being defense and contracts Write to they overall applications applications foot satellite square and production. and Direct received purchased We we aerospace, adopted for our CVD facility expand to our XX, are used an capability November contribute materials offerings we that are our area valves experienced during a agreement very order manufacturer why business of of materials. fourth products of our industrial viability with growth Our the fittings business. future in these leading healthy our materials and clearly just optimistic of some major materials These of edge the One our business on XXXX, pursue product goal, for line To about materials XXX,XXX to validates be of was commercial the examples the the quarter has The continue MesoScribe. of success.

the we and plan in While well have building now in is approval, build necessary the site progress. XXXX, delays we incurred various permit, out

employees have will know-how. developed new experienced our remarks over knowledgeable CFO, details a and follows; Before our as I'd that turning McNeill, to of the and who Tom results. on my more we like industry-leading to provide call have conclude team technology one,

the and and provided by equipment custom marketplace. have materials required customers our the support We

at times revenue however, we We need profitable have To more invested stream. historically and diversify we have a business that uneven delivered have division. materials house million develop stable recognized to $XX consistent and the and a to growth, building our end, our and revenue in

invested building We and to $X.X related for the materials in business. needed the million equipment XXXX have

ready have and We the materials continue and by the strategy. production USA diversification our to received start facility, expect QX permits required to Materials XXXX we to

pleasure and Finally, operations. long-term our to technology, bring we and to performance. further CVD McNeill, Tom at new operating and join we consistent and will and guide next With are to to that, success. making you deliver have strategy, investments my it introduce generation you. CVD This our is Tom position future materials, We current diversification which make help will – for will in clarity we continue organization. believe financial equipment our CFO, ultimately pleased our who improved revenue Thank

Thomas McNeill

Thank and I'm be here. you, to Len, glad

a was revenue annual to of for as our $X.X diluted $X.XX $X.X fourth decrease or XX.X%. $X.XX or a per $X.X year, or the million was $XX.X $X.X as million And share Our to share million our was last last this compared $XX.X In year to net year. last of net diluted loss million $X.X a million year, or year million profit compared revenue compared $XX.X of per million XX.X%. the quarter, million decrease

as $X.X last income was per $X.XX year. $X.XX Our net $X.X or million quarter or to per of share fourth compared net million share diluted loss diluted

this in primarily or revenue million our received during as or our orders the XX.X% approximately approximately to industry, million $XX.X XX.X% year compared represented attributable aerospace of decrease last the revenue $X.X this year completion year. largest of Our of our which to from was revenue customer

opportunities existing largest sales million to from increased end $X.X XXX,XXX and our receive and customer, year $X.X to million December XXXX. at of new with continue customers exclusive We orders and additional

quarter Our revenue and the all our for fourth XXXX remained orders and expectations. of below

million. of second from quarters the we the XXXX, XXXX, XXXX in the new The quarters two for XXXX. in however, of anticipate last orders, will $X revenue will New revenue two of level first our our of in of level the which in were first orders affect excess customers half of however, quarter approximate

Our business receiving up our facility. materials expenditures ability as depends levels receipt orders for other reviewing expenses to as planned among new a profitability return things the equipment to sublet cost including and higher of the and potential portion savings, of well new of upon the of operating ramp of

cash to level XXXX our monitor line because With to to capital meet current to in years current have our our XX our needs the the the were continue next the liquidity, at cash had in expired our us. of orders. September of as We and elected to We terms XX credit operations a acceptable staffing and and respect to reported, credit over line credit equivalents time expected working not past believe we support level as renewal of sufficient on previously we not borrowed had not renew months. and we line

capital working million at last was year year. $XX.X million Our compared $XX.X working to capital of

finally at cash working to million compared and investment overall service cash regard the in the in approximately reductions currently primarily million building XXXX XXX,XXX, $XX.X to improvements CVD building in attributable Materials of primarily And were sales debt capital million which of Materials of operating million. with CVD includes in and purchase was operating of payments $X.X resultant Materials and year $XX costs facility. to expense approximately exclusive equivalents remains November the invested in interest end for on in new Our of million at the XXXX. million, capital $X.X approximately $X our CVD operations, to decrease $XX.X XXXX The related machinery payments loss. the

during new and CVD We facility operations of We of levels commencement believe the to XXXX equivalents next second and quarter level XX orders. like of current expenditures evaluate expected be our to continue to meet to months. positions for in our Materials back and call for questions. staffing the and your to support flow our cash operations third expected or from cash the sufficient our With cash that, and working required turn the our capital operator over capital will I'd the

Operator

you Thank first with Montgomery Please Instructions] proceed. the of question [Operator Reiss Scott. comes Janney Brett line from Our

Brett Reiss

go all for do in on unlock about can variety a of that of little is better source delays The a and of in XXXX? order bit these a to orders customer XXXX specificity be reasons, that's delays going what more you and into flow

Len Rosenbaum

better customer acquired on got another it flow was by company, things to We a put One order expect would in hold. XXXX. so be

customer budget had XXXX moved along same the -- XXXX, others few expenditure a capital for their lines. were Another to and there

Brett Reiss

with of the old you anemic couple businesses, of didn't Why in just that happening the get past didn't calls resulted happen? were of that businesses? happen. seems that a that last orders - In because devoted to - that to customer resurrection into that Right. was a aerospace back the there of would hope able quarters and so the didn't be resources large it legacy the What Company for see the that many legacy

Len Rosenbaum

you And this come type Our rises an significantly even business the or months a many two in spurts, for a has quarter Hopefully, and or lumpy to first many, turnaround. example always year significance. years. then of of number quarter is seems go it of of any been without up it this high

Brett Reiss

have and is backlog and in Now, the the fill Tantaline orders the that hit you building business, as running? handling to ground materials do up soon you as hand running

Len Rosenbaum

orders take that to advance look not do that in business. We far for

beginning want the we in it promote this to a little that will that a quarter, or expect should take quarter either. inundated and don't during We We the more lot second time. be

return positive that expect So, the on fourth we seeing in a start that quarter. I should

Brett Reiss

the in subletting need The rent? standard use, going or the start type facility that come not a you prospective and there approvals do to the have is the tenants of them pay to lesser same us portion of for that we're to of

Len Rosenbaum

There's lesser are may to permits what they or going certain standard. their also. upon approvals somewhat But operations of be, need a depending

Brett Reiss

of idea, cash of next the going Tom, have quarters? be what you the Do couple over burn to any is

Thomas McNeill

you in about compensation million a $X tell there's Well, loss, this look $X and past I if million $X in depreciation/amortization. year you could that million at was stock

operating et base, million year's about $X last on investments cetera. burn capital was the plus So

at and So certain location, it'll degree as flow as to well will some extent on guarantee and based forward. will it's coming are orders - And we that the we certainly help any appreciably that today orders. showing dictate may for we as not sublet, building, or showing any and certainly will in take timing a the there is cash then nice to that of the building the expect one any we're depend no in we quarters, that'll expenses may level of receive good happen actually much point the the on as actions as that a Company a we and the building, move very it's but the

Brett Reiss

from gotten broker showing the the broker? the have that's Well, you positive space, feedback

Thomas McNeill

you feedback until But positive on Yes. the great. is that as dotted sign again, as line, – much positive feedback

building think I that a certainly on what great to before, And positive the the market on in of new as existing and opposed us be the to in and able we're right And launch we're up readying, customers position operations, so ramped Len empty to an building. that, to said space. we puts

event. that's So positive a certainly

Brett Reiss

With so that? respect a looking be you're the to oxygenator models and business – different to that the is the ultimately the the what's monetized value variety the can what there Company, benefit are cartridge, on of of at, that timetable

Len Rosenbaum

timetable a on have don't We it.

not pursuing are we're and cartridge. just pursuing We the oxygenator it

As a to earlier, Fluid also. applicable other Reactors that it said I are of line is industries

the hear that So, the for point. now forward. cartridge right And oxygenator you'll pursuing going this at one about more we're

Brett Reiss

on quarter, that? versus details employees of us year number third give say let's the The can at some end you

Thomas McNeill

I'm number. lower. XXX to just it certain XXX currently year-over-year the little sure that or down about we're from we're I give and Well, level, a quarter, third to from XXX is exactly from But take not have

Brett Reiss

or new kind of that quarters? is we you get it that's the around a employees sets type Do the come of that with of matter coming we going match in the skill business down to think to shifting hope materially

Len Rosenbaum

as needed or levels it's We've really in and depend going increase an will forward. decrease level upon around whether always the shifted really our a order employees current

Brett Reiss

days? How is the esprit company these the morale of de corps

Len Rosenbaum

progress. making good. and pull I I don't day, think –I out every it's but go good believe and it's do everybody we're don't I

Operator

[Operator comes Please Trust. from Bryn of with thank our next question Mawr Morton Howard you, the Instructions] And line proceed.

Morton Howard

a engine ceramic aerospace item possibility hot the Supposedly aerospace a for of great and there technology other with products. success, using was a mix it's is that

of very over engine number are orders a of is things, gases So the possible fiber if aerospace and company? hot the the from was we such discouraged and deal other

Len Rosenbaum

not No, completely.

that hoping it. expect be will additional company will we'll long-term we're We that the that and product needed be fulfill

Morton Howard

all surprised right if it's they question months one very anymore such anyway, don't sexy graphene mean, saying product, But item I'm are in. any, believed the I Well, in graphene just they if graphene lifetime other a engine, a my a – so a chance haven't can hot used but not sold we've the I but you I'm company, even lifetime? a Then ago, to needed they few getting last don't. was really I I there children's never my be in credit say company. a well, you're you any chemical give is deposition vapor for commercial but is older,

Len Rosenbaum

is that yes. to answer The

Operator

you. Thank

further questions time. I'd Management, back like no at to the return to have We this remarks. in over for queue closing floor

Len Rosenbaum

to Okay. I our you first call, again I look in conference thank and to end for the you everyone quarter. quarter speaking fourth joining year very and Thank forward much.

Operator

for your this your will you may This lines thank you conclude participation. today's teleconference disconnect And you. Thank at time.

CVD Equipment (CVV) 1 Apr 192018 Q4 Earnings call transcript