Financial Data and Key Metrics Changes - Fourth quarter 2023 revenue was $4.1 million, a decrease of approximately 43% compared to the prior year period [3][7] - Fiscal 2023 revenue totaled $24.1 million, down $1.7 million or about 7% from the previous year [5][16] - Operating loss for the fourth quarter was $2.5 million, compared to an operating loss of $221,000 in the prior year [8] - Net loss for the quarter was $2.3 million, or $0.33 per share, compared to net income of $1.5 million, or $0.23 per share in the fourth quarter of 2022 [8] - Gross profit margin for fiscal 2023 was 21%, down from 26% in the prior year [15] Business Line Data and Key Metrics Changes - CVD equipment segment revenue decreased by approximately $0.4 million, primarily due to lower PVT 150 system revenues [5] - CVD Materials revenues were lower by about $2 million due to the sale of a subsidiary and the wind-down of operations [15] - System revenues for the fourth quarter were impacted by a cost overrun on a launch contract [7][29] Market Data and Key Metrics Changes - Backlog increased slightly to $18.4 million from $17.8 million year-over-year [30] - Cash and cash equivalents at December 31, 2023, were $14 million, down from $14.4 million the previous year [18] Company Strategy and Development Direction - The company aims to expand its presence in high-power electronics, battery materials, aerospace, and industrial applications [13] - Recent orders include a $10 million multi-system order for silicon carbide CVD coating reactors, indicating a focus on industrial applications [14][37] Management's Comments on Operating Environment and Future Outlook - Management expressed disappointment with both fourth quarter and full year performance, emphasizing the need to return to consistent profitability [3] - The company is cautious about predicting future results due to economic and geopolitical uncertainties [9] - Management noted that the demand for silicon carbide devices has been adjusted and pushed out, affecting order volumes [23][24] Other Important Information - Operating expenses increased due to higher employee-related costs and additional selling expenditures, partially offset by lower bonus costs [6] - The company is taking corrective actions to mitigate cost overruns experienced in the past [22] Q&A Session Summary Question: What caused the cost overrun and what measures are in place to prevent it from happening again? - Management acknowledged understanding the causes of the cost overrun and has implemented corrective actions to mitigate future occurrences [22] Question: Why have there been no new PVT 150 orders for about a year? - Management indicated that demand for silicon carbide devices has slowed, affecting order volumes, and noted a general marketplace slowdown [23][24] Question: What is the current backlog and how does it reflect future orders? - Management confirmed that the backlog is $18.4 million, with additional orders expected to increase this figure [34] Question: Are there other areas in the business that can compensate for the slowdown in electric vehicle enthusiasm? - Management highlighted that the company serves multiple markets, including aerospace and industrial applications, which may help offset the slowdown in electric vehicle demand [27][41]
CVD(CVV) - 2023 Q4 - Earnings Call Transcript