Motion Solutions that Change the Game Second Quarter 2023 Financial Results Call August 3, 2023 ...

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents Allied Motion Technologies Inc.'s unaudited condensed consolidated financial statements as of June 30, 2023, along with detailed accounting notes Condensed Consolidated Balance Sheet Highlights (Unaudited) | Account | June 30, 2023 (in thousands) | December 31, 2022 (in thousands) | | :--- | :--- | :--- | | **Total Current Assets** | $239,244 | $236,007 | | **Total Assets** | $585,494 | $588,347 | | **Total Current Liabilities** | $87,757 | $87,588 | | **Long-term Debt** | $227,106 | $235,454 | | **Total Liabilities** | $348,700 | $372,882 | | **Total Stockholders' Equity** | $236,794 | $215,465 | Condensed Consolidated Statements of Income Highlights (Unaudited) | Metric | Three Months Ended June 30, 2023 (in thousands) | Six Months Ended June 30, 2023 (in thousands) | | :--- | :--- | :--- | | **Revenues** | $146,769 | $292,318 | | **Gross Profit** | $45,977 | $91,811 | | **Operating Income** | $12,020 | $23,409 | | **Net Income** | $6,769 | $13,084 | | **Diluted EPS** | $0.42 | $0.81 | Condensed Consolidated Statements of Cash Flows Highlights (Unaudited) | Cash Flow Activity | Six Months Ended June 30, 2023 (in thousands) | Six Months Ended June 30, 2022 (in thousands) | | :--- | :--- | :--- | | **Net cash provided by (used in) operating activities** | $17,273 | $(290) | | **Net cash used in investing activities** | $(12,368) | $(50,923) | | **Net cash (used in) provided by financing activities** | $(11,092) | $58,781 | | **Net (decrease) increase in cash** | $(6,494) | $6,383 | - The company operates in a single segment, manufacturing and marketing controlled motion products. For the three months ended June 30, 2023, one customer accounted for **12%** of revenues and another for **10%**[95](index=95&type=chunk)[97](index=97&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes detail financial statement preparation, key accounting events like the FPH acquisition and Spectrum Controls payments, revenue disaggregation, debt covenants, and derivative hedging strategies - In Q2 2023, a measurement period adjustment for the FPH acquisition resulted in a **$1,356 thousand** increase to goodwill[24](index=24&type=chunk) - A deferred acquisition payment of **$12.5 million** for Spectrum Controls was paid in January 2023, with one final payment of **$12.5 million** due by January 2024[27](index=27&type=chunk) Revenue by Target Market (Six Months Ended June 30) | Target Market | 2023 (in thousands) | 2022 (in thousands) | | :--- | :--- | :--- | | Industrial | $128,845 | $92,911 | | Vehicle | $65,570 | $65,137 | | Medical | $44,562 | $41,513 | | Aerospace & Defense | $40,266 | $26,593 | | Distribution and Other | $13,075 | $11,353 | | **Total** | **$292,318** | **$237,507** | - The company's Amended Revolving Credit Facility of **$280 million** matures in February 2025 and is subject to financial covenants, including a minimum interest coverage ratio of **3.0 to 1.0** and a maximum leverage ratio. The company was in compliance with all covenants as of June 30, 2023[59](index=59&type=chunk)[61](index=61&type=chunk) - The company uses interest rate swaps to hedge variable-rate debt. As of June 30, 2023, swaps with a notional amount of **$100,000** were in place, maturing between December 2024 and December 2026[66](index=66&type=chunk)[142](index=142&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=23&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, highlighting revenue growth from volume and acquisitions, the impact of inflation and interest rates, and improved cash flow, affirming a strong liquidity position - The business environment in the first half of 2023 was characterized by inflation impacting input costs, a higher interest rate environment, and persistent supply chain disruptions[101](index=101&type=chunk) - A key near-term focus is the successful integration of six acquisitions completed in late 2021 and Q2 2022 to leverage synergies for future growth and profitability[103](index=103&type=chunk) - Bookings decreased in H1 2023 compared to H1 2022, primarily due to a normalization of customer order patterns as supply-chain constraints and longer lead times, which were significant in the prior year, have eased[107](index=107&type=chunk)[116](index=116&type=chunk) [Operating Results](index=25&type=section&id=Operating%20Results) The company achieved significant year-over-year growth in Q2 and H1 2023 revenue and net income, driven by volume increases and acquisitions, with improved gross margins Q2 2023 vs Q2 2022 Performance | Metric | Q2 2023 | Q2 2022 | Change (%) | | :--- | :--- | :--- | :--- | | **Revenues** | $146,769k | $122,722k | 20% | | **Gross Profit** | $45,977k | $39,774k | 16% | | **Operating Income** | $12,020k | $7,518k | 60% | | **Net Income** | $6,769k | $4,581k | 48% | | **Diluted EPS** | $0.42 | $0.29 | 45% | H1 2023 vs H1 2022 Performance | Metric | H1 2023 | H1 2022 | Change (%) | | :--- | :--- | :--- | :--- | | **Revenues** | $292,318k | $237,507k | 23% | | **Gross Profit** | $91,811k | $73,234k | 25% | | **Operating Income** | $23,409k | $11,783k | 99% | | **Net Income** | $13,084k | $7,084k | 85% | | **Diluted EPS** | $0.81 | $0.45 | 80% | - Organic revenue growth was **17%** for Q2 2023 and **21%** for the first six months of 2023[106](index=106&type=chunk)[115](index=115&type=chunk) - Interest expense increased **140%** in the first six months of 2023 compared to 2022, driven by higher average debt levels to fund acquisitions and increased interest rates[120](index=120&type=chunk) [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a strong liquidity position with $24.1 million in cash, improved operating cash flow, reduced investing cash use, and $61.2 million available under its credit facility Cash Flow Summary (Six Months Ended June 30) | Activity | 2023 (in thousands) | 2022 (in thousands) | | :--- | :--- | :--- | | **Net cash from Operating Activities** | $17,273 | $(290) | | **Net cash used in Investing Activities** | $(12,368) | $(50,923) | | **Net cash from Financing Activities** | $(11,092) | $58,781 | - The increase in operating cash flow in H1 2023 is primarily due to increased sales and more efficient conversion of working capital as supply chain constraints eased[134](index=134&type=chunk) - As of June 30, 2023, the company had **$218.8 million** outstanding under its Amended Revolving Facility and **$61.2 million** available for borrowing[135](index=135&type=chunk)[137](index=137&type=chunk) - The company believes its existing cash, flexible credit agreement, and anticipated operating cash flows are more than sufficient to meet its cash needs for the next twelve months[138](index=138&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=35&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages market risks from foreign currency fluctuations and interest rates through hedging strategies, including foreign currency contracts and interest rate swaps for variable-rate debt - A hypothetical **10%** change in the U.S. dollar value would have impacted sales by approximately **$4.9 million** for Q2 2023 and **$10.0 million** for H1 2023[139](index=139&type=chunk) - To mitigate foreign currency risk, the company held foreign currency contracts with notional amounts of **$17.9 million** at June 30, 2023[65](index=65&type=chunk)[141](index=141&type=chunk) - The company has interest rate swaps hedging **$100 million** of its variable-rate debt. A hypothetical **1%** change in interest rates on the unhedged portion of debt (**$118.8 million**) would impact interest expense by approximately **$0.3 million** for the quarter[143](index=143&type=chunk) [Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2023, with no material changes to internal control over financial reporting - As of June 30, 2023, the Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective[145](index=145&type=chunk) - No changes occurred in internal control over financial reporting during the quarter ended June 30, 2023, that would be reasonably likely to have a material effect[146](index=146&type=chunk) PART II. OTHER INFORMATION [Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the risk factors previously disclosed in the company's 2022 Annual Report on Form 10-K have been reported - The company reports no material changes to the risk factors disclosed in its 2022 Annual Report on Form 10-K[147](index=147&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=38&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2023, the company withheld 39,007 shares at an average price of $38.63 to satisfy employee tax withholding obligations for vested stock awards Issuer Purchases of Equity Securities (Q2 2023) | Period | Number of Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2023 | 38,774 | $38.65 | | May 2023 | 233 | $35.37 | | June 2023 | 0 | N/A | | **Total** | **39,007** | **$38.63** | - Shares purchased were withheld by the company to satisfy tax withholding obligations in connection with the vesting of employee stock awards and are not part of a formal stock repurchase plan[149](index=149&type=chunk) [Exhibits](index=38&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL taxonomy documents - Exhibits filed include CEO and CFO certifications under Sarbanes-Oxley Sections 302 and 906, as well as various Inline XBRL files[150](index=150&type=chunk)

Allied Motion Technologies Inc. (AMOT) Q1 2023 Earnings Conference Call May 4, 2023 10:00 AM ET Company Participants Craig Mychajluk - Investor Relations Dick Warzala - Chairman, President & Chief Executive Officer Mike Leach - Chief Financial Officer Conference Call Participants Greg Palm - Craig-Hallum Capital Group Ted Jackson - Northland Securities Operator Good day and welcome to the Allied Motion Technologies First Quarter Fiscal Year 2023 Financial Results Conference Call. [Operator Instructions] Ple ...

Motion Solutions that Change the Game First Quarter 2023 Financial Results Call May 4, 2023 Dick Warzala Chairman, President & CEO Mike Leach Senior Vice President & CFO Safe Harbor Statement The statements in these slides that relate to future plans, events or performance are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate, or imply future resul ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Form 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023. OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | --- | --- | --- | |--------------------------------------------------------------------------|------------------------------------------------------|------------------------------ ...

Allied Motion Technologies Inc. (AMOT) Q4 2022 Earnings Call Transcript March 8, 2023 10:00 AM ET Company Participants Craig Mychajluk - Kei Advisors Dick Warzala - Chairman, President & Chief Executive Officer Mike Leach - Chief Financial Officer Conference Call Participants Greg Palm - Craig-Hallum Ted Jackson - Northland Securities Brett Kearney - Gabelli Funds Gerry Sweeney - ROTH Capital Operator Greetings, and welcome to the Allied Motion Technologies Fourth Quarter and Fiscal Year 2022 Financial Resu ...

Motion Solutions that Change the Game Fourth Quarter and Full Year 2022 Financial Results Call March 8, 2023 Dick Warzala Chairman, President & CEO Mike Leach Senior Vice President & CFO Safe Harbor Statement The statements in these slides that relate to future plans, events or performance are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate, or i ...

Economic and credit market uncertainty could interrupt our access to capital markets, borrowings, or financial transactions to hedge certain risks, which could adversely affect our financial condition. We may experience difficulties that could delay or prevent the successful development of new products or product enhancements under new and existing contracts, and new products and solutions or product enhancements may not be accepted by our customers. In addition, the development expenses we incur may exceed ...

Allied Motion Technologies, Inc. (AMOT) Q3 2022 Earnings Conference Call November 3, 2022 10:00 AM ET Company Participants Craig Mychajluk - Kei Advisors Richard Warzala - Chairman, CEO & President Michael Leach - SVP & CFO Conference Call Participants Gregory Palm - Craig-Hallum Gerard Sweeney - ROTH Capital Partners Operator Good day, and welcome to the Allied Motion Third Quarter 2022 Conference Call. [Operator Instructions]. Please note this event is being recorded. I would now like to turn the conferen ...