CPI Aerostructures Inc. (NYSE MKT:CVU) Q1 2019 Earnings Conference Call Transcript

May 10, 2019 • 08:30 am ET


CPI Aerostructures Inc. (NYSE MKT:CVU) Q1 2019 Earnings Conference Call Transcript


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Good day, and welcome to the First Quarter 2019 CPI Aerostructures Earnings Conference Call. All participants will be in listen-only mode. (Operator Instructions). After today's presentation, there will be an opportunity to ask questions. (Operator Instructions) Please note, this event is being recorded.

I would now like to turn the conference over to Sanjay Hurry, Investor Relations Counsel. Please go ahead.

Sanjay Hurry

Thank you, Andrew. Good morning, everyone, and welcome to CPI Aerostructures 2019 first quarter financial results conference call. A copy of the Company's earnings press release that was issued this morning and the accompanying PowerPoint presentation to this call are available for download on the Investor Relations section of the CPI Aero website. On the call this morning are Douglas McCrosson, President and Chief Executive Officer; and Vincent Palazzolo, Chief Financial Officer. After their prepared remarks, management will hold a Q&A session.

As a reminder, this conference call will contain certain forward-looking statements, which involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from projected results. Included in these risks are the government's ability to terminate their contracts with the company at any time, the government's ability to reduce or modify its contracts if its requirements or budgetary constraints change, the government's right to suspend or bar the company from doing business with them as well as competition in the bidding process for both government and subcontracting contracts.

Subcontracting customers also have the ability to terminate their contracts with the company, if it fails to meet the requirements of those contracts or if the customer reduces or modifies its contracts due to budgetary constraints. Given these uncertainties, listeners are cautioned not to place undue reliance on any forward-looking statements contained in this conference call. Additional information concerning these and other risks can be found in the Company's filings with the SEC.

Before I turn the call over to management, please note that Doug and Vince are available for follow-up with institutional investors. Please schedule a follow-up via the contact details listed in today's press release. With that said, I'd like to turn the call over to Douglas McCrosson, President and Chief Executive Officer. Good morning, Doug.

Douglas McCrosson

Good morning, Sanjay, and thank you all for joining us on our 2019 first quarter results call. I will begin with a brief review of the quarter's performance and our progress in integrating our recently acquired subsidiary, Welding Metallurgy Inc., or WMI. Vince Palazzolo, our CFO, will then review our financial results in detail. I will then conclude the call with some commentary on the implications to CPI Aero of the 2020 defense budget request and highlight several key contract opportunities that should keep us on a solid growth trajectory over the next several quarters and beyond.

Starting with Slide 4. Continued operational execution during the first quarter gave us a strong start to the year and advanced our strategic priorities for 2019. We are pleased to report higher revenue, gross profit and net income