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| Statement |
|---|
| The combined leverage of our 320 basis point gross margin improvement and our 440 basis point operating expense to sales ratio resulted in an 8.2% operating margin |
| The sales split between commercial and government defense for our battery business was 78-22 compared to 71-29 reported for the 2022 quarter, and the domestic to international split was 48-52 compared to 55-45 last year, demonstrating the continued success of our global revenue diversification strategy |
| So I mean we've kind of always put it off as to -- it's going to be a good opportunity |
| With a great ending to 2023 and a strong Q4 finish strong backlog position and a positive trend of gross margin improvements, we are focused on continuing these efforts throughout 2024 |
| We improved gross margin for the business throughout the year, which was a key priority as we started 2023 |
| I am pleased to say we were able to finish out the year with an initial paydown on our acquisition debt and increased our overall backlog sequentially from Q3 |
| Nevertheless, we are in a strong position to bring this product to market for the US government and other customers |
| With continued strong focus on lean and material deflation initiatives, we are targeting further sustainable gross margin improvements for both businesses, which will further improve generation of cash and allow us to continue to pay down our acquisition debt |
| We have a good strong backlog currently and feel pretty good about the position we're in |
| So as you get into Q4, you've now had a good strong six months of strong forecasting and forecasting not only from our customers all the way through to our supply chain, it just really eases the burden of visibility, you can get ahead of some of the orders, and you're not expediting parts because you were ordering them within the normal lead time of the parts |
| This growth was driven by the highest medical sales quarter since we entered this business in 2012 and increased 118% year-over-year |
| With the strengthening of our balance sheet, we are positioned to continue the paydown of our debt, thereby reducing the costly interest expense, which represents almost $0.12 per share on a TTM basis |
| Revenues from our Communications Systems segment of $8.8 million more than doubled the $4.0 million we reported last year, primarily attributable to fulfilling long lead time orders of vehicle amplifier adapters to a global defense contractor for the US Army in integrated systems of amplifiers and radio vehicle amounts to a major international defense contractor under an ongoing allied country government defense modernization program |
| As we enter 2024, the operational priorities are continued gross margin improvement through material cost deflation and lean productivity projects in both the Battery and Energy and Communications businesses |
| The replenishment rate remains high and the backlog represents a very healthy 65% of TTM sales |
| I stated increase in gross margin was a key focus across the business, and we accomplished a positive gross -- positive trends throughout 2023 |
| Looks like a solid quarter and a nice way to wrap up the year |
| This represents the highest TTM level that we have achieved in the last 15 years |
| We are working material win projects to improve gross margin on those specific products and will reprice future opportunities |
| The year-over-year and sequential increases were primarily due to improved price realization as well as a concerted effort to level load production more evenly throughout the quarter, resulting in labor utilization efficiencies and higher cost absorption |
| We have an accordion feature that we can call into play if we needed $15 million, which we don't because we're generating some very good EBITDA |
| And finally, you've done a good job at paying down the debt from the acquisition |
| We started the 2023 year with a cyber attack that shut down operations for weeks in two of our sites, then rallied throughout the year to post the highest full year revenue and profit level in over 10 years, a result of great teamwork throughout the business and supply chain |
| Going forward, our backlog, diversified end markets, growth initiatives and ongoing actions to improve our gross margins and further strengthen our balance sheet, position us well to optimize the leverage potential of our business model |
| On the material side, supply chain is improving, but we are still far from pre-COVID lead times for components |
| Nice presentation and a good quarter |
| On an absolute dollar basis, operating profit improved $3.4 million over the 2022 fourth quarter to $3.6 million |
| Sales funnel and commercial opportunity pipeline growth is key for 2024 and beyond to keep our strong organic growth trajectory going as we have yet to fully utilize and realize the return from all our new product investments |
| Revenues from our Battery & Energy Products segment were $35.7 million, the highest sales quarter in our history for this segment compared to $32.1 million last year, an increase of 11.1% |
| And we believe we're going to bring it to market successfully, and it will be a contributor to our bottom line |
| Statement |
|---|
| We have been informed by the US government, they expect significantly lower production volumes of this product due to delays in the Integrated Visual Augmentation System known as IVAS, currently under development by Microsoft |
| Gross margin was 27.2% compared to 28.7% last year, primarily due to inefficiencies caused by delays experienced in the receipt of certain components, partially offset by higher factory volume |
| Brett Davidson And I know you guys have gone through some growing pains introducing some of those new products regarding operating efficiency |
| The potential risks and uncertainties that could cause actual results to differ materially include the impact of COVID-19 related supply chain disruptions, potential reductions in revenue from key customers, acceptance of new products on a global basis and uncertain global economic conditions |
| We've identified a few challenges in our processes in some system imposed waste |
| I mean the real challenge now that we've become a lot more medical involved in some of our other customers, I mean, the medical process to just change either process or product is just a lot more lengthy than some of just the industrial and other projects that you deal with |
| So there's always some risk there |
| This compares to a loss of $0.2 million or a loss of $0.01 per share for the 2022 quarter |
| In some cases, we've been able to just cancel, in other cases, the government is taking a harder stance and now didn't really allowed much to happen there |
| And then I think you also -- you talked about maybe a certain component that was delayed in the quarter |
| Actual results could differ materially from those projected as a result of various risks and uncertainties |
| The increase in medical was partially offset by declines in government defense and oil and gas sales of 11.4% and 11.3%, respectively |
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