AEY - Earnings call transcript Q2 2021 | ADDvantage Technologies Group, Inc.

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Operator

Good day. And welcome to the ADDvantage Technologies Fiscal 2021 Second Quarter Financial Results Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Brett Maas, Hayden IR. Please go ahead, sir.

Brett Maas

Operator. you, Thank

today well joined Hart, and President We Donna by Guy, as as the CEO; are Joe company's Controller.

statements subject issued which Form ADDvantage and on Technologies, or varying Financial in information in be or most the filed consolidated this are regarding conjunction materially today's on relationships, its on and call include, as things, number and Technologies. included events, statements, in with call subsidiaries events Reform Form XX-K only future Commission. Securities Technologies ADDvantage Act results Before from and The ADDvantage press Technologies' currently are with contained that call among strategic provisions of and change. conference operators, on agreements this involve those presented is to of other original begin future considered release maintain with call, system financial XXXX. Securities as and the to to of based Harbor as like Participants actual are uncertainties. anticipated such we well and limited due Litigation included cautioned Private remind manufacturers financial the guidance this equipment Safe a ADDvantage ability company's earlier conference future are and These statements report most such ADDvantage on Exchange These the predictions certain these to may that statements XX-K. which differ information recent forward-looking may recent notes statements available on the in risks of regarding the contain performance the should today made subject multiple I'd Technologies everyone to of reports future results factors forward-looking as forward-looking statements

information year. update certain such information only during this not of the guidance any change, the of the at provide Technologies only it points factors as company speaks as may date influencing and Such necessarily call. ADDvantage this guidance Although, will will

financial of call, on about discussion Technologies. measures at Joe, measures are we this as addition During considered are you our located these are these non-GAAP non-GAAP income net to non-GAAP measures in be issued Officer measures. used certain I'd should ahead. instead why financial financials, are GAAP certain website President financial press will that closest financial to measures. find release the GAAP as and the and such which financial to today, Chief and these now our earlier benefit In turn Hart, call with relevant. addvantagetechnologies.com, a of of non-GAAP reconciliation investors believe included go present like for we Executive may over and with in tables ADDvantage also measures ratios the These and the not of and please Joe

Joe Hart

you, Thank today. the call us And thank Brett. you on to joining everyone

are the seeing XG acceleration finally in carriers. of by wireless work XG We the Tower awaited all long and

the sites encompassing still of XXXX. received quarter be today site we orders. be and fiscal awards that revenue will year doubled second our of the fourth Over calendar year report will are additional a the and indicate quarter weeks, last There fiscal next half this we of in levels half first increase to first awarded. of received the awards aggregate, the have the initial period calendar significant wireless in purchase In XXXX, in the few

a overall part are In fact, of the the scope initial work. awards small just of

months. over the our next initial in be quite bit of So The in to additional are markets multiple a future. from awards markets, we we carriers few several upside have expect awarded

and are for southwest us the presence. established But an in markets new markets Some are where Midwest all are have regions of and greater these others regions. we

carriers, OEMs. we have have direct, integrators timing In technologies and older multiple either But large The on at is Some the this impacted sometimes room will of removing what additional this Other site installing the or are is new be or the through later. installations rollout XG soon summary, a for. decommissioning pandemic rooftop the and work of rollout. sometimes antennas. installing been follow awards to for from or for to make tower XG and awards radios The frequencies XG loosened finally the budgets waiting underway. XG involve and new

this the crews the of with place key United in establish all the across benefit markets integrators wireless with We is center We service are and notable activity strategically are not we to relationships States. To work for results already carriers, experienced QX. the reflected of coming be agreements today years. the OEMs over the in reporting needed positioned this of major multi-year to in in uptick pursue and have the XG wave driven clear,

encouraged at the increase fiscal in of to second see to by and operational the which all current half in quarter, us our four his in fourth October. in commencement time of and give late higher a XXXX, the September from Jimmy what into their This driven and benefiting carrying this a anticipate substantial compete same XX. expect period am with building team wireless all calendar revenue work, efficiency, We year. Taylor I networks improved carriers wireless XG. activity activity volume out also in quarter, starts third of ending momentum suggests the new will are the site our for our by

up market inventory businesses added. This our at costs, customers of and lower better have team XXXX positioned year-over-year, These new and has reduced of new expand cash, are side QX translating consignment Nave revenue Triton Reggie new into and for our our customers by progress $X reflecting beyond. of In from operating well and We million the much made and leadership business led is partners level addressable to telco a forward the customers. the higher was our and success Datacom inventory. offer use to and Jaramillo his base

nationwide hopeful the US return Donna, over will office to for that a a I increased our vaccinations Donna call impacted and and deal offerings to work. Triton new to to a We remote of year. half and Guy, Our provide the offices felt impact the by of the most network impact this review enterprise most will clients our team to second offices, more the sale financial has of our have workers With ahead. of to year, please to last many move our COVID a closing lead the of that, detailed throughout offset great go past business, new however, positive added now clients' results. Controller continues remain Despite that shutdown be turn on products.

Donna Guy

personnel operational last such year. XXXX. an increase second Joe. X.X% of were compared fiscal the of $XX you, same million was the of to an driven second loss an XXXX $X inventory million of increase quarter The to $XXX,XXX, intangible million, for a compared expenses diluted quarter increased last compared Thank EBITDA on compared fiscal $X.X quarter to the for year. obsolete Telco with was the up $X.X communications obsolescence increase a quarter's quarter, million. as Sales related loss XX.X our prior impairment segment X% of to decrease for with Gross quarter segment non fiscal year. and by compared million fiscal $XXX,XXX million year-over-year goodwill, million relates in charge by year. diluted $X.X severance quarter for million $XX.X million. for the the last the for second quarter $X.X of increase XXXX shares, the telco share, by to increase $X.X charge of a negative to and in inventory selling profit loss of and fiscal $X.X increase increased related margin last XXXX quarter period including year. the of of for in cash the million $XXX,XXX, $X.X year $X.X $X.X relatively compared flat charge executive year to loss assets offset $X.X $X.XX charge compensation solutions and $XXX,XXX to in costs, XX% due last $X.X quarter $XXX,XXX administrative EBITDA of quarter loss of as per quarter of This million the general wireless million last by partially of loss of was based share, fiscal margin million costs included second of compared shares an a Net wireless were obsolescence loss with cost Adjusted $X.X same included quarter. the loss million the of million or million computing quarter to $XXX,XXX, efficiency. of million to negative at $X.X million well same with the increased million for prior increase the year. same The Selling, for of an prior inventory a $X.X to same or of Operating XX.X compared $XXX,XXX a for as expenses for due segment. $X.X for segment with per the the based $X.XX Adjusted with increased $XXX,XXX for for EBITDA million same an the adjusted million a year profit fiscal in Gross the on quarter was Net $XX.X stock our

primarily $X.X of XX balance XXXX, September XXXX. of and as sheet, cash was March cash used equivalents XX $X.X fund to operations. to our were Cash Turning million with as compared million

XX of comprised applied March PPP down Outstanding the of lease a $X.X revolving million million notes was net million as million payable As at from $X.X debt loan, obligations. March $X.X loan $X.X September XXXX, Debt million company line million $X.X of finance obligations. to for we of XX under had XXXX million million slightly finance $X.X at $X.X our Debt inventories which of and of of was including was have forgiveness, revolving by $X comprised of of under XXXX. up our million, $X the and XX lease million XXXX. for of September line $X.X which credit, credit, XX $X PPP went million,

sufficiently the with means as This any to I over our fully you. more term to to remarks. conditions operator returned. now we to turn normalized believe questions. facilitate continue are near portion We the back of stocks capitalized financial concludes appropriate Thank business business the overview support call will

Operator

private Our [Operator comes George investor. a first Instructions] Gasper, question from

UnidentifiedAnalyst

going commentary, preparing the the near year. Very the would Yes, crews working hear Joe, Good that change the and describe could in by see, into that goes thought that to, to maybe this all that What's you're number positive going current tower side? everyone. I that work thank you have style and could forward? and how relate you the end and if this? work some of XG term of on And of anything is line of crews processing presented on the to afternoon, doing what to like that? number the you and your we could on fiscal you. else of you And

JoeHart

hear back. Sure. Hi, Good to George. you

now about I a of XX probably tried weekends house during about we the balance, growing over will crews. a don't XX the so It we're we're I'll standing in crews And between in The that let's balance to next say transition - But to with week in we say right the where XX to invest crews crews varies so good out. here to and growing next that or in-house think a keep subcontractor XX over bit we days. little be little crews. level XX. from

And and crew a we're work. place. crews, of yes, a well customers you little So very peaking crews, balance mix work a in obviously, both as we're civil really that's I of the of between right, type and good encouraged tower as is the count, when changes morale gave

value a the precise the time detail we've giving of the mix is had into not work. month overall, We that backlog calendar year. through us But until the by of come know takes in orders end you a probably actual the So month. lot visibility because won't of this in first more

it promises making here. So it's has we after are started. work looks quarter, finally very these encouraged. coming been time a quarter And And like long it's been

going of bit is June to but just this a to quarter. bit. very So of then be ramp strong, current here and August it's in May And July, month. isn't going sort up quite slow gangbuster a to are be third September construction a pick going

we actual So it have backlog. and in kicked has truly do

UnidentifiedAnalyst

not? tower you if Joe, a elaborates the up bit that I work And, assume end about be way away doing along work elaboration or that to going okay. explain accomplishing what or see, actually you the on from itself. could right and I work streets buildings, on is more installing, little the you're

JoeHart

the for of of have balance Well, that principally cell calendar the sites. right in up is now made we workload hand, the year, macro

of a remarks, work. in different As kinds I combination my of said it's

coming equipment customers for asking and us XG the make Some to radios. room are decommission

voice we're them. new customers, out additional Some Because should and the doing installing customers, radios expanding And thing. actually the over transfers balance then And video the XG is to like I say and existing of file point and work I'll XG. messaging XG more things in primarily XG XG frequencies frequencies going for large data other that. we're And that used and be conducted a frequencies. text is are antennas for streaming good

heavy new will XG balance So network a that of and both comprised frequencies. the XG be of

or really on So nature making advanced it's even the coming. work. in existing for room towers prep of all and is XG good, rooftops the

So scopes of a work. of it's kind combination of

UnidentifiedAnalyst

Do line where further big work And sign that could that's could you up sounds the a actually of maybe potential year-to-year think of like that the activity? I being ongoing about very put multiple down job. current, basis. coming comment one would contracts out a you in Well, All into years this business some Okay. at it on of right. see made you the you end you

JoeHart

and our with Well, the and year of carriers typically, multi-year, they integrators, three agreements actual they are all and are OEMs, the all service work. service agreements,

or we've work. maybe getting XX of four so assign But much So sight months as of problem months scheduled now two, the our front have out that, as nose. in been been last we've the actually enough six weeks in we sort backlog, three, is

the quantity the the and length So backlog extending nicely. of are really quality,

to So encouraged allows everything us just very crews that and you we're tools, space, warehouse for that name it, and, plan by flows trucks right it downhill.

encouraged by feeling we're that. very So

UnidentifiedAnalyst

the in central you're it the trying you in Let's the are end the up What's that of you your southeast, of Midwest, United that? States. pushing or or geographical, area? larger going maybe western say, part you into you is be will south to, any And from of we'll into be where Northwest Okay. primary mentioned the terms could Southwest, and working, working on strategy area, part

JoeHart

our chasing two or and next and the actually home the on we are, strategy of to right targets things in are capital We the - Northeast, the website So Atlantic. don't have that West that the our base says top targets Southwest, the that Midwest Southeast which be really Mid now. Coast base, working resource our greater and have document and after sort

So I envision that don't soon. anytime

right. So in growth or think we major or have Coast. to now But Carolinas, follow any no would I cetera. Atlantic for we the Florida, of Most areas, Mid West the carriers OEMs, are high through go certainly, plans Northeast Southeast Georgia, region? Those et the

UnidentifiedAnalyst

agreements going in debt, resale with Do to question agreements you and going to really then And financing, build that are comfortable get to you to have Okay. be required that's try forward. rolling regarding to forward are this you feel the your loan surge now? have Or expanded? that place

JoeHart

that, see think diligent there for share have substantially We're we - cash. our our a months. the do next the job, here shares price doing envision good a nice a year increase SX been for as about over capital. growth debt. But needing standing that out the feel SX, last may adequate for the XXXX we being don't over we did should year. sell we via I managing we We that the have very don't very We has make to some recovery We few

see decreasing at matter million forgiven, point a of that loan by our we fact, be level here. some PPP debt should actually As the $X.X

our to we're periodically far, line it, pretty our feel having from good in so confident we about standing - banks to of but maybe credit talk keeping draw and, continue to about cash in our We position

UnidentifiedAnalyst

going you've for huge Okay. develop the question the and I earnings what telco that opportunity leveraged really seem three outsider in on within at the the okay. telephonic it And there at at one that? six And area, of an a to number lot to when time, What's done shares going period, operation encouraging Joe, operational of work some opportunity Hopefully, the overview create AEY got real regenerating creates decent months one forward. beauty, an you of look going going of and some got forward Well, real that's improvement months, for the should you in would and terms whole build forward another is on the and business. and point this pretty that business. that's modest in that you've thinking positive looking be to your things, of outstanding

JoeHart

lot his nice of held think year, optimal has have we and Reggie's done have have Triton and possible and as job but Well, the predecessor, nicely. team a as we we a team both done Nave this and so operations increased, work Nave from perspective, operationally Reggie position have an including really sales margins

And so in they Nave hard remote work the works encouraged space, we great the side. COVID-XX. I network very The that well. Triton team are products a and was the a team enterprise of just and are by mean, hit is on

offices and does restored when the to of revenue bit last can somewhat unknown a really Nave be I teams they've months a expected, well they're whole, will after couple work? but return So on really doing year, it's So an given really work bad the to a of team, that as around uncertainty our both level the well. network, hard but think as normal

kind telco for teams. pretty that our blessed had had actually we've And we of feel the both so year we've

UnidentifiedAnalyst

Alright.

that feel the you're going need board management? last crews forward having that that expansive if add might going to management, XX the thing it give base do opportunity you're your kind on on I coordinate in you're little thought required you this to do down process development And on to Okay, to XX whatever. looking one some you're just And go to us a area, know to personnel or crew as good. XG about Can from the you additional of going be activity crew that? side. to

JoeHart

customer Taylor wireless both recently, recently time worked States. largest and we President Dan known probably known a last and up Mastek, as the has competitor native a the the construction we and added Vice Most De Well, add I've the United in - region, few for program have Jimmy years. as management longtime [Dan for integrator for and Chicago Chicago, northern Leria] we've executive. Dan added in long industry, the in

has just He southwest in Dan we So then southern and added joined of recently here Chicago. us a the region. more fellow VP representative Shawn And longtime AT&T of and be to integrator. other the GM his with Shawn was a finished month. in management Texas the Wireless some the first Rickman region,

we added So team. to have standing operations two long VPs the

along. gone So been the we've we've team up bolstering as

So we're we're in with we ready work. forward good a feel And the to place. spring

Operator

are turn further at there time. closing conference you or no And for remarks. back this additional any over the questions to now I'll

Joe Hart

Okay, of through the to we We're one on Joe about this thank mixed those where call. results joining where are halfway QX. want It's want for of them again. us be not to QX. I for good is and Hart everybody bag sessions kinds

be into And us have new backlog we here pattern of fiscal now we but up be QX we year. it going trajectory wireless good to up will somewhat June pick the May the of just in We and into the will very it QX ramp second plateau a anything half work will the be XXXX. to should take have of at exception, really into not to to a towards volume pretty be finish the think a level and are the we starting of a strong in a but

your we the Technologies. participation you call. for your So We appreciate interest. investors in And thank being appreciate ADDvantage in

Operator

an That does you. thank We do your today's Thank conference. conclude participation. Have day. you for excellent

ADDvantage Technologies (AEYGQ) 14 May 212021 Q2 Earnings call transcript