Workflow
CVD(CVV) - 2022 Q4 - Earnings Call Transcript
CVVCVD(CVV)2023-03-27 22:42

Financial Data and Key Metrics Changes - The company reported a strong revenue growth of 57% for fiscal 2022 compared to the prior fiscal year, with fourth quarter revenue being 53% higher than the same quarter in 2021 [7][19] - The net income for the fourth quarter was 1.5million,whilethefullfiscalyear2022recognizedanetlossof1.5 million, while the full fiscal year 2022 recognized a net loss of 224,000, which included a 1.5millionfederalemployeeretentioncredit[7][24]Thegrossprofitpercentageimprovedto281.5 million federal employee retention credit [7][24] - The gross profit percentage improved to 28% in the fourth quarter from 16% in the prior year, driven by higher sales levels and an improved product mix [16][21] Business Line Data and Key Metrics Changes - The CVD Systems and Services segment received orders exceeding 33 million in 2022, a 52% year-on-year increase, with fourth quarter orders amounting to 9.2million[10][11]TheSDCsegmentexperienceda359.2 million [10][11] - The SDC segment experienced a 35% increase in sales over the prior year, reflecting higher demand for gas and liquid control system products [13] Market Data and Key Metrics Changes - The company noted that the demand for its products is influenced by customer market conditions and general economic conditions, indicating fluctuations in revenue and profitability [8][28] - The company received a significant order from a major aircraft engine manufacturer, valued at approximately 3.7 million, signaling a potential recovery in the aerospace market [12] Company Strategy and Development Direction - The core strategy focuses on markets supporting the electrification of everything, particularly silicon carbide, which is driving current growth [9] - The company aims to achieve consistent long-term profitability and is cautiously optimistic about future growth [8][31] Management Comments on Operating Environment and Future Outlook - Management acknowledged ongoing supply chain issues but indicated that they have been managed effectively throughout 2022 [42] - The company is unable to predict the impact of current economic and geopolitical uncertainties on its financial position but believes its cash flow will be sufficient for the next 12 months [27][29] Other Important Information - The backlog at December 31, 2022, was 17.8million,anincreasefrom17.8 million, an increase from 10.4 million at the beginning of the year [25] - Cash and cash equivalents decreased to 14.4millionfrom14.4 million from 16.7 million, primarily due to the payoff of a mortgage and capital expenditures [26] Q&A Session Summary Question: Cash flow changes from Q3 to Q4 - Management confirmed that cash flow fluctuations are typical due to contract completions and down payments received [38] Question: Impact of potential credit contraction - Management stated that the company is in a strong cash position and is not reliant on bank lines of credit [40] Question: Supply chain issues - Management indicated that while supply chain issues are still present, they have been effectively managed [42] Question: Outlook for PVT-150 product - Management noted that the PVT-150 has improved gross margins compared to legacy products and anticipates a contribution margin of over 50% as sales increase [48] Question: New customer acquisition for PVT-150 - The company aims to penetrate two additional accounts for the PVT-150 product by year-end [53]