Richardson Electronics Ltd. (NASDAQ:RELL) Q1 2020 Earnings Conference Call - Final Transcript

Welcome, and thank you for joining the Fiscal Year 2020 First Quarter Earnings Call for Richardson Electronics. Before we begin, please ensure you've opened the WebEx participants and chat panels based in the associated icons located at the bottom of your screen. Please note that all audio connections are muted at this time. [Operator Instructions]

With that, I'll turn the conference over to Edward Richardson.

Good morning, and welcome to Richardson Electronics' conference call for the first quarter of fiscal year 2020. Joining me today are Robert Ben, Chief Financial Officer; Wendy Diddell, Chief Operating Officer and General Manager for Richardson Healthcare; Greg Peloquin, General Manager of our Power & Microwave Technologies Group; and Jens Ruppert, General Manager of Canvys. As a reminder, this call is being recorded and will be available for audio playback. I'd also like to remind you that we'll be making forward-looking statements and they're based on current expectations and involve risks and uncertainties. Therefore, our actual results could be materially different. Please refer to our press release and SEC filings for an explanation of our risk factors.

Overall, I'm pleased with our business in the first quarter. We generated net income in the quarter versus a loss in our last quarter. Our longest running ALTA750 CT tube have been in the field for more than 15 months, and customers are gaining confidence. As a result, our healthcare business is significantly improving. At the end of the quarter, we've received European approval to use the CE Mark, which opens up more sales opportunities throughout Europe. PMG repeated its trend of excellent growth. PMG sales continue to increase on a perpetual basis, as our partnerships with new technology companies gain traction. Canvys and EDG continue to be the workhorses of the company and contribute significantly to our overall profitability.

The only negative in the quarter is that the semiconductor wafer fab equipment market hasn't turned around yet. This segment had its last strong quarter in Q1, FY '19. Our teams are pushing hard for every opportunity and making changes to improve efficiency throughout the organization. We've been told that the semiconductor wafer fab market will show signs of growth in the near-term. When this happens, we are well prepared to support our customers and we'll be firing in all cylinders.

I'll now turn the call over to Bob Ben, who will share the highlights of our first quarter, then Greg, Wendy and Jens will provide more details on their business unit performance.

Thank you, Ed, and good morning. I will review our financial results for our first quarter fiscal year 2020 followed by a review of our cash position. Net sales for Richardson Healthcare and Canvys increased for the first quarter of fiscal year 2020 by $0.6 million or 26.8% for Healthcare and $0.1 million or 1.4% for Canvys. Total company net sales for the first quarter of fiscal year 2020 were $40.7 million, compared to prior year's first quarter of $44.2 million, which was a decrease of