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Edited Transcript of PRCP earnings conference call or presentation 5-Sep-19 12:30pm GMT

Q4 2019 Perceptron Inc Earnings Call

Plymouth Sep 16, 2019 (Thomson StreetEvents) -- Edited Transcript of Perceptron Inc earnings conference call or presentation Thursday, September 5, 2019 at 12:30:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* David Lawrence Watza

Perceptron, Inc. - President, CEO, CFO, Principal Accounting Officer & Director

* Jay W. Freeland

Perceptron, Inc. - Chairman of the Board

* Laura Pecoraro

Perceptron, Inc. - Director of Finance

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Conference Call Participants

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* Christopher Ralph Van Horn

B. Riley FBR, Inc., Research Division - Analyst

* Gregory William Palm

Craig-Hallum Capital Group LLC, Research Division - Senior Research Analyst

* Mike Houston

Lambert, Edwards & Associates, Inc. - MD

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Presentation

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Operator [1]

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Good morning, ladies and gentlemen, and welcome to Perceptron's Fourth Quarter and Fiscal Year 2019 Investor Call. Please note that this call is being recorded. I will now direct the call to Mike Houston, Managing Director with Lambert, Perceptron's Investor Relations firm. Please go ahead.

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Mike Houston, Lambert, Edwards & Associates, Inc. - MD [2]

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Thank you, Nicole. Good morning, and welcome. Thank you for joining the Perceptron conference call and webcast to discuss the company's financial results for the fiscal fourth quarter and full year 2019. After market closed yesterday, Perceptron issued this quarter's earnings release, which is available on the website investors.perceptron.com. The Form 10-K will be filed in the coming days.

Joining me on the call today are members of Perceptron team, Dave Watza, President and Chief Executive Officer; Laura Pecoraro, Director of Finance; and newly appointed Chairman of the Board, Jay Freeland. We will begin the call with Perceptron team's prepared remarks and then open the call up to questions. However, before we begin today's call, it is my responsibility to inform you that some of the material that we will be discussing today constitutes forward-looking information under the meaning of the Private Securities Litigation Reform Act.

Any forward-looking statements made are based upon information believed to be true as of today. Please review the release and SEC filings for information on the risks and uncertainties that may cause actual results to differ materially from the forward-looking information provided.

Perceptron is not responsible for transcripts of this call made by independent third parties. Finally, in yesterday's press release, we provided a reconciliation of the non-GAAP measure that will be discussed in this call. Unless otherwise noted, comments are in U.S. dollars, and references to years will be for fiscal years, which ended on June 30.

I will now turn the call over to Perceptron's Chief Executive Officer, Dave Watza. Dave?

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David Lawrence Watza, Perceptron, Inc. - President, CEO, CFO, Principal Accounting Officer & Director [3]

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Thank you, Mike, and thank you to everyone who has joined us for today's call. Before we get started, I'd like to take a few moments to introduce Laura Pecoraro, our Director of Financial Operations, who is helping us through the transition with Michelle's departure.

We are pleased to have Laura fill this role, as she has been a part of the Perceptron team in finance since 2016. I have also personally worked with Laura for more than a decade in a variety of finance roles prior to joining Perceptron. So I'm certainly glad to have her assistance during the transition.

On the call today, I will update you on our business and the progress we continue to make against our long-term strategic plan.

Following my comments, Laura will provide a detailed overview of the financials for the fourth quarter and fiscal year 2019. Additionally, our newly appointed Chairman, Jay Freeland, will provide an update on his view of the business. Following Jay's remarks, I will conclude with our outlook for fiscal 2020.

Fiscal 2019 was a challenging year for Perceptron, but we made significant progress on a number of fronts, which we believe will pave the way for success, as we execute against our longer-term strategic goals.

We entered fiscal 2020 energized and committed to returning to growth in bookings and revenue. Despite the challenges we faced in 2019, our underlying business remained strong, as we continue to develop our industry-leading products, while maintaining our deep customer relationships.

These fundamental elements of our business and our dedicated team provide us a unique competitive advantage and position us well for the future. Similar to our last call, we maintain our belief that the current market softness is being driven by a few very large-scale external factors that have significantly influenced our results. One of these factors is the uncertainty and volatility caused by the escalating trade tensions between United States and China.

We believe that these trade tensions have impacted our top line more than our input cost, particularly as we compete to sell new systems into the Chinese market. We also continue to be impacted by shifting trends in the automotive industry that we believe are moving more toward electric and autonomous vehicles. Specifically, as our automotive OEM customers contemplate the future impact of these technologies on their businesses, they have opted to delay investments in other areas which directly impacts our business.

While we recognize that our business remains subject to our customer's timing and frequency of new program launches, we believe the investments in technology we have made over the last several years will allow us to benefit from these changes in the longer term.

Despite macro headwinds and shifts in customer order timing, Perceptron's value proposition and competitive advantage remains: our integrated customer solutions improved quality; reduced downtime; and shortened product launch cycles, which can equate to substantial value for our customers.

Turning now to our products. I would like to take a few moments to review a handful of the innovative solutions we have launched over the last fiscal year. Our AccuSite product is one that we have talked about several times over the past year and a product that we believe offers significant additional opportunities to expand our market penetration.

Through the use of a camera bar that tracks a constellation of light emitters around our robot-mounted sensor, we're able to significantly improve the accuracy of our robotic measurement systems by completely replacing the robot's accuracy with AccuSite's performance. This allows the customer to omit expensive and time-consuming correlations with their CMM.

We continue to make significant improvements to this product based on the work we're doing with a large global customer. I'm very proud of the improvements and progress of our engineering and field operations team in making this a critical success for us.

We anticipate announcing several new developments that will further enhance our AccuSite product. We're encouraged by the significant level of interest from several of our large global customers for these additional enhancements.

We believe AccuSite enables us to be the market leader in this space and dramatically improves our AutoGauge solutions.

We also have discussed products improvement initiatives that will enhance our AutoFit solutions. We believe these initiatives position us as a market leader in noncontact gap and flush solutions. We're excited for the launch of our newly designed Helixsolo product line. Helixsolo represents the next evolution of our TriCam single-laser sensor. And in this product family, we have added the ability to measure transparent materials through the use of different laser wavelength and we've made significant improvements to our image processing algorithms.

Taken together, these new capabilities allow us to now measure the gap and flushness of more areas of the vehicle body, including the 4 corners where headlamps, hoods, fenders and tail lamps, lift gates and quarter panels all come together. This is an important quality aspect of the product for automotive OEM customers.

The unique capabilities of Helixsolo have been on display at one of our European customers during the first installation of this new and improved gap and flush solution.

I am very proud of the dedication by our team to make this installation a significant, positive event in our company.

The next product I would like to review is our AutoGauge ACF solution. This is our genesis of near-line solutions that broaden our ability to provide new and innovative solutions to the automotive industry.

We believe this technology will enable us to penetrate industries beyond automotive as evidenced by our recently announced win of an AutoGauge ACF order at global appliance manufacturer.

We developed the AutoGauge ACF product to work hand-in-hand with AccuSite, providing a turnkey solution for in-line measurements, enabled by the development of our automated path generation technology. We believe this will benefit our in-line AutoGauge solutions and will be another key enabler for expanding beyond automotive.

And last, I would like to take some time reviewing the advancements we're making with our auto guide solutions, more commonly known as robot guidance.

Our current suite of solutions has traditionally been focused on the higher end of robot guidance where our automated metrology technology is used to automate and improve complicated manufacturing processes and then measure the results.

We're in the process of augmenting the solution set to enable simpler robot guidance applications that do not require the precise requirements of assembly. Applications such as automating part load and unload in the manufacturing process or offsetting robotic sealer and adhesive application so the customer does not have to fixture the part. This allows us to leverage our existing technology and also our project execution resources to capture more of the production process with our customers.

Let me turn for a moment to some of the investments we are making in future growth beyond our R&D efforts.

We have invested in new product development for the past several years, and now we're investing in the sales, marketing and business development that will drive the ultimate economic success of these products.

In the coming year, we plan to invest in the people and processes needed to drive growth and demand for our products.

It is through the collective effort and vision of our sales, marketing and business development teams that we will continue to drive these growth areas and keep us pointed in the right direction.

Moving beyond our exciting product developments, I want to briefly review our results for the quarter. Fourth quarter bookings were $20.9 million, which represent a sequential increase of 58% from our third quarter and an increase of more than 10% over the prior year's fourth quarter on a constant-currency basis.

Quarterly bookings in excess of $20 million is an important indicator of success for the company. We intend to get back to these levels and higher in the near and long term.

Despite continued economic headwinds, the increase in bookings for the quarter was driven in large part by Americas and Asia regions. We have been pleased with the renewed booking activity and demand we experienced in the face of uncertainties caused by trade disputes, regulatory issues and foreign currency exchange headwinds. This provides us with optimism as we enter our new fiscal year.

Quarterly revenue was $18.2 million, which was a sequential increase of 17% from the third quarter and was at the high-end of the guidance range we provided a few months ago. We see continued early success with new product launches that facilitate the dramatic strategic change in product planning for the automotive industry.

This success reinforces our confidence in achieving our long-term growth targets, despite uncertain global growth. The wide-sweeping revolution of electric vehicle production provides new challenges for our OEM partners, and more importantly, an opportunity for Perceptron to solve those challenges.

In fact, last month, we announced 2 robot guidance orders involving battery packs from 2 different OEM partners. For these reasons, we remain optimistic in achieving long-term aspirations for sustained high-single-digit revenue growth and double-digit earnings growth. Before I turn the call to Laura, I want to reaffirm our confidence that the development path we are on will lead to new opportunities within automotive and further down the road, sectors beyond automotive. As we continue to execute our strategic plan over the next few years, we believe it will provide sustainable and profitable growth opportunity for the company and its stakeholders, which will lead to enhanced enterprise value. Laura?

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Laura Pecoraro, Perceptron, Inc. - Director of Finance [4]

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Thanks, Dave. Sales in the fourth quarter were $18.2 million, a 16.7% sequential increase from the past Q3 and a decrease of 22.9% from the fourth quarter of last year.

Our fourth quarter sales results had an unfavorable foreign currency impact of $0.7 million when compared to prior year's fourth quarter, primarily due to the dollar-euro exchange rate fluctuation. Our Europe region net sales of $8.9 million, which when adjusted for currency was a 1.2% increase from the same quarter of last year.

Sales in Asia were down in the fourth quarter to $3.9 million, compared to sales of $5.8 million in Q4 of prior year.

As mentioned earlier, we believe the uncertainty and volatility caused by the escalating trade tensions between the U.S. and China has impacted our top line, as we compete to sell new systems into the Chinese market.

Sales in our America's region was down $3.2 million to $5.4 million for the quarter. This decrease was due to softness primarily in in-line systems and reflects the delays and program launches on the part of OEMs that Dave discussed earlier. For fiscal 2019, our sales were $76.8 million, a decrease of 9.3% from fiscal 2018. As sales decline in our Americas region was partially offset by increases in our Europe and Asia regions for the year.

On a constant-currency basis, the year-over-year decrease was 6.2%. As a reminder, we adopted ASC 606 as of July 1, 2018 using the modified retrospective transition method.

Under this method, we recorded the cumulative impact of the change in rules directly to retained earnings as of July 1. Furthermore, we will not retrospectively apply this guidance to any of our prior year results, so fiscal 2018 financials are still presented under the old guidelines, while revenue starting with Q1 2019 is being presented under the new guidelines as outlined under 606.

As previously disclosed, the revenue recognition rules under 606 allow us to recognize revenue faster than the previous rules on an individual project-by-project basis.

As a result of these new rules, we recorded a positive net transition adjustment to retained earnings in the amount of $2 million in the first quarter of fiscal 2019. Included in the net transition adjustment was a gross revenue adjustment of $3.8 million, which reduced the backlog level by the same amount. Under prior revenue recognition rules, the company would've recognized $20 million in revenue in the fourth quarter of fiscal 2019 and $72.8 million for the full fiscal year 2019.

The rule changes do minimize the timing mismatches between cost and revenue that we had experienced in prior fiscal years. Gross profit as a percent of sales for the fourth quarter of fiscal 2019 was 32.4%, which is down 570 basis points as compared to the same period of our fiscal year 2018. The decrease is primarily due to mix and less fixed cost absorption given our lower revenue level. As we have discussed in the past, our longer-term aspiration is for consistent quarterly gross margin level set.

We believe the actions we've taken to reduce both our fixed and variable cost throughout the back half of fiscal 2019 will provide benefit to gross margin in the coming quarters.

Our gross margins were negatively affected by lower cost absorption on our lower sales volume as well as the mix shift of our revenue in terms of geography and customer.

Despite these factors, gross profit margin for fiscal 2019 was 35.4% compared to 37.8% in prior year.

Furthermore, we continue to look at all aspects of our business to identify additional opportunities to expand our margins, enabling us to invest in future technologies and provide improved return to our shareholders.

Next, let's turn to the operating expense line items. Engineering expenses, which include R&D, decreased approximately $0.4 million to $2 million in the fourth quarter of fiscal 2019.

This decrease was primarily due to employee-related expenses, including the reduction of accruals related to our short- and long-term incentive compensation plans, as our fiscal 2019 results underachieved the targets set to earn this incentive compensation. Engineering research and development expenses were approximately $8 million in our fiscal year 2019 compared to $8 million in our fiscal year 2018, primarily due to lower employee-related costs offset by an increase in the specialized supplies utilized in the development of our products.

Selling, general and administrative expenses were $5 million for the quarter, an increase of $0.1 million compared to last year's fourth quarter. This change is due to an increase in sales promotion, finance and legal expenses, partially offset by employee-related expenses, including the aforementioned reduction of accruals related to our short- and long-term incentive compensation plans.

SG&A expenses for the year were approximately $19 million as compared to $18.5 million for our fiscal year 2018. The change is primarily due to an increased spending in legal and audit fees of $0.5 million: sales, promotion and marketing costs of $0.4 million; increased building and rent expenses of $0.3 million; and higher financing expense of $0.1 million, partially offset by decreases in employee-related costs of $0.5 million, including the reduction of our incentive compensation accruals and lower amortization of $0.3 million related to the impairment charge recorded against certain definite-lived intangibles in the fourth quarter of fiscal 2019.

Operating loss for fiscal 2019 was $6.8 million, which is down from operating income of $5 million last year.

In the fourth quarter of fiscal 2019, we recorded a noncash impairment charge of $6 million, impacting the goodwill balances of our CMM reporting unit, as well as a noncash impairment charge of $1.4 million impacting the net intangible asset balances of the unit.

As of June 30, 2019 after giving effect to these impairment charges, the company had $1.8 million of net goodwill and $1.8 million of net intangible assets.

Operating income for fiscal 2019, excluding both impairment charges and other special items, was $0.2 million. Our effective tax rate for fiscal year ended June 30, 2019 was 3% compared to 17.2% in fiscal year 2018.

Cash and short-term incentive balance ended the fiscal year at $6 million at June 30, 2019, down slightly from $6.7 million at June 30, 2018 and $6.2 million at March 31, 2019.

We had no outstanding borrowings on our $8 million line of credit at the end of this or fiscal -- last fiscal year. Cash generation remains a primary focus for us. We continue to believe that the strategic initiatives we have implemented over the past several years have positioned us well for long-term growth.

With that, I will now turn the call over to our Chairman, Jay Freeland, to share his prepared remarks. Jay?

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Jay W. Freeland, Perceptron, Inc. - Chairman of the Board [5]

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Thanks, Laura, and good morning, everyone. Like Dave, I'm encouraged by our performance in the fourth quarter, particularly bookings, and feel that the long-term prospects for the company remained very positive.

I believe my unique perspective, combined with the experience in this space, will be useful in driving transformation of Perceptron and serve as a catalyst for achieving the company's goals. My backgrounds lend itself well to Perceptron's focus on core technical competency and market share penetration, but also on executing on our financial commitments, including meaningful growth in the automotive sector and very importantly adjacent industries as well.

The appointment of Sujatha Kumar to our Board is a very good step in broadening the Perceptron Board's collection of experiences. Her industry and technology background should serve us well. And I look forward to working with her. I'm pleased to add her to the Board. And at the same time, I'd like to thank Rick Marz for his many years of dedicated service to the company.

Starting immediately, and over the next 5 to 6 months, I'm going to be working closely with Dave, his team and the rest of the Board to further assess our capabilities, shape the company's long-term vision and accelerate progress towards our strategic goals.

Look, there's a lot of work to be done, but there's also plenty of opportunity. Perceptron owns an amazing portfolio of cutting-edge technologies, and I'll be working with Dave to maximize the value of that portfolio. Where your company sits today should be considered the starting point and not the destination.

With that, I'll hand the call back over to Dave for his closing remarks.

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David Lawrence Watza, Perceptron, Inc. - President, CEO, CFO, Principal Accounting Officer & Director [6]

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Thank you, J. As I've said before, our confidence in the long-term growth potential of Perceptron remains strong. We believe there's significant upside and value-creation opportunities ahead for Perceptron, and we'll continue to aggressively execute the company's strategic plan with the goal of maximizing value for Perceptron shareholders.

To that end, the strategic planning committee, led by the management team, has undertaken a number of key steps to further that objective.

Among those was the hiring of a business development expert to the organization. This individual is providing significant input on our path forward to; one, identifying optimized near-term growth opportunities that leverage our existing sales channels as well as our global sales operation teams; two, identify and execute a path forward to expand our footprint to robot guidance and extend our competitive mode with the goal of enhancing our addressable market and top line growth profile; three, review our recent product development activities and identify growth opportunities within automotive and other markets.

As I said earlier, we believe our AccuSite product will be a key enabler of these growth initiatives. We look forward to continuing the path forward over the coming quarters and years to enhance shareholder value.

Before moving to the Q&A portion of the call, I would like to review our outlook and guidance for fiscal 2020.

We are targeting an increase in bookings in the range of 15% to 20% over the fiscal 2019 results.

We also expect revenue growth for the full fiscal year 2020 to be in the mid-single digit percentage range as compared to fiscal 2019, and we expect operating income margin in the mid-single digit range.

Last, I'd like to thank the global Perceptron team for their continued dedication to our company's success. I will now turn the call over to the operator for Q&A.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from Greg Palm of Craig-Hallum Capital Group.

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Gregory William Palm, Craig-Hallum Capital Group LLC, Research Division - Senior Research Analyst [2]

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I guess just to start with the bookings, obviously, nice bounce back in the June quarter. I'm curious, would you characterize that as broad based? Was it more concentrated within a handful of customers? And I guess what do you see thus far in the September quarter?

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David Lawrence Watza, Perceptron, Inc. - President, CEO, CFO, Principal Accounting Officer & Director [3]

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Yes. So I would say that in the Americas, it was focused within a few customers, and it was stuff that we were expecting earlier in the year that just kept getting delayed, as I've mentioned prior. In Asia, I would say, it was more broad based across many customers.

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Gregory William Palm, Craig-Hallum Capital Group LLC, Research Division - Senior Research Analyst [4]

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And should we assume that some of those delayed orders that you had been talking about previously are still left to go? Could you give us any sense for maybe how bookings are shaping up in the September quarter or not?

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David Lawrence Watza, Perceptron, Inc. - President, CEO, CFO, Principal Accounting Officer & Director [5]

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Yes. So within the quarter, our bookings tend to be extremely, out of my face, sporadic but not linear at all.

We're chasing a lot of opportunities. We're excited about where we are and where we're headed. We think a lot of our new products are helping us. I'm not ready, Greg, to really call the quarter for you from a bookings standpoint.

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Gregory William Palm, Craig-Hallum Capital Group LLC, Research Division - Senior Research Analyst [6]

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Okay. Fair enough. A few weeks back, your press released and order for a global appliance manufacturer. I mean can you talk about any details around the size of that, the scope, the sales cycle or at least give us some view of kind of how you view that market opportunity? And whether there's a, I guess, an opportunity for additional orders within that customer, within maybe some of that customer's competitors?

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David Lawrence Watza, Perceptron, Inc. - President, CEO, CFO, Principal Accounting Officer & Director [7]

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Yes. Greg, when we think about the -- so this is one of our orders in other industries. We're excited about it for that -- from that perspective. We're also excited about it from a perspective of the AutoGauge ACF product getting out in the market. It helps us quite a bit to be working with a large global customer that has lots of other opportunities.

It's not a huge order. It's a nice sized order that gets our foot in the door, and we think there's a lot of opportunity beyond it. And we think we have the right people to execute it such that the customers excited by what they've done.

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Gregory William Palm, Craig-Hallum Capital Group LLC, Research Division - Senior Research Analyst [8]

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Okay. So maybe more of a validation. And then what about EVs? Just kind of curious, for your core in-line applications as they sit today, any changes in, I don't know, the size of the orders associated with electric vehicles and more importantly, I mean what are some of the other areas that you could play a role in? Sounds like battery packs is serving an initial order that you've gotten. But just trying to get a sense for what sort of the expansion of the market opportunity there is as may be the -- more of the market shifts to EVs over time?

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David Lawrence Watza, Perceptron, Inc. - President, CEO, CFO, Principal Accounting Officer & Director [9]

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Yes. Greg, I'm going to answer a couple of things. First, I want to go back to the AutoGauge ACF solution. We do believe that that's going to help us -- help enable us to go into some of these other markets. Having our foot in the door with a customer, large, global and a different industry, gives us something we can talk about with other potential future customers. And I want to know that we're very linked globally in these wins that we get. So that the teams around the world can share that and also have something new to talk about with newer customers. So I'm excited about that. When I think about our AutoGauge solutions which you're asking about, I think about AccuSite being a value add to that solution set. And it also -- we believe, that has helped push us back into leadership position in that part of the market. So it is an upsell opportunity. It is more value that we can provide. It gets rid of the expensive and time-consuming correlation studies that the OEMs have to do with our other products. It really just adds value to the customer.

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Operator [10]

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Our next question comes from Chris Van Horn of B. Riley FBR.

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Christopher Ralph Van Horn, B. Riley FBR, Inc., Research Division - Analyst [11]

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Just wanted to -- if you don't mind, we could dig into the guidance a little bit. You're calling for mid-single digit revenue growth. Is that kind of based on maybe partially the backlog as well as some of the [plan] that you see? Any more detail you could provide there.

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David Lawrence Watza, Perceptron, Inc. - President, CEO, CFO, Principal Accounting Officer & Director [12]

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Yes, that's a good question, Chris. And actually there's some assumptions about the economy that we're making in there. We're assuming that the U.S. economy continues to grow, albeit at a slower pace, and that the global economy and the European economies do not step back into recession. We're also assuming the OEMs continue to invest in the growth and quality of their business. And we believe that some of our new products will make more progress in the current year than they have in past years. Does that help?

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Christopher Ralph Van Horn, B. Riley FBR, Inc., Research Division - Analyst [13]

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It does. And then is it correct way to look at it, you're forecasting mid-single digit operating margins, that's going to be up significantly from what you saw this year. Is that mainly volume driven? Or is there may be a mixed tailwind? Or there some operating expense adjustments that are going to help that as well?

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David Lawrence Watza, Perceptron, Inc. - President, CEO, CFO, Principal Accounting Officer & Director [14]

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Yes. I would say the main driver of that is going to be the top line revenue. We also -- as you know, we announced a cost reduction initiative in the middle of May, so that'll give us a full run rate impact next year. And we continue to work on our costs throughout the business, looking at product costs, looking at costs throughout all departments and all regions of the business. That's just becoming part of our culture.

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Jay W. Freeland, Perceptron, Inc. - Chairman of the Board [15]

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If you don't mind I'll jump in there too. I wouldn't sell short the amount of opportunity there is to continue to improve the company from an efficiency standpoint and that drops directly through whether it's cost or otherwise. I have (inaudible) to continue bringing the margin to a level that we think is appropriate. Obviously, some will come from the revenue but some of that, even without revenue, I think you would see margin improvement even without that.

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Christopher Ralph Van Horn, B. Riley FBR, Inc., Research Division - Analyst [16]

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Okay. Got it. How about from a competitive perspective? I mean obviously your bookings have been really solid this quarter. You're forecasting continued increase in bookings. Are you competing -- are you winning on the technology offering a differentiated solution? Is price a component? Maybe what are you seeing from a competitive standpoint?

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David Lawrence Watza, Perceptron, Inc. - President, CEO, CFO, Principal Accounting Officer & Director [17]

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Yes. Chris, that's another really good question. We've got some very good competitors globally. But I will tell you that our investments in technology over the past year -- few years have really, I would say, leapfrogged us ahead of the competition. And I'll tell you that our AccuSite product is definitely helping us win new orders against our competition. And I feel the same way about our gap and flush solution that we've launched with the Helixsolo and the improved algorithms.

And I don't really do underestimate the value to our customers of being able to measure the 4 corners. That's been something that's been elusive for us because of the transparent materials, but now with our multicolored lasers as well as our algorithms, we're able to measure that for the OEMs.

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Operator [18]

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This concludes our question-and-answer session. I would like to turn the conference back over to Dave Watza for any closing remarks.

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David Lawrence Watza, Perceptron, Inc. - President, CEO, CFO, Principal Accounting Officer & Director [19]

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Thank you, Nicole. Thank you, everyone, for your interest in our company and for joining us today for our fourth quarter and full year call. We are certainly pleased with the continued progress we made toward implementing our long-term strategic plan, and we remain confident that it will provide us the resources we need to deliver strong growth in fiscal 2020 and beyond. I look forward to talking to you again after the first fiscal quarter.

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Operator [20]

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The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.