Q4 2023 Ultralife Corp Earnings Call
Participants
Jody Burfening; IR; LHA, Inc
Michael Manna; President, Chief Executive Officer, Director; Ultralife Corp
Phil Fain; CFO; Ultralife Corp
Josh Sullivan; Analyst; The Benchmark Company LLC
John Deysher; Analyst; Bertolet Capital LLC
Presentation
Operator
Thank you for standing by, and welcome to Ultra Life Corporation's Fourth Quarter 2023 Results Conference Call. At this time, all participants are in a listen only mode after the speakers' presentation, there will be a question and answer session to ask a question. At that time, please press star one one on your telephone. Please be advised that today's call is being recorded.
At this time, I turn the call over to your host, Jody Burfening. Please go ahead.
Jody Burfening
Thank you, Valerie, and good morning, everyone, and thank you for joining us. This morning for Ultralife Corporation's earnings conference call for the fourth quarter of fiscal 2023. With us on today's call are Mike manner, AutoWeb's President and CEO, and Phil Fain, Ultralife's Chief Financial Officer. The earnings press release was issued earlier this morning, and if anyone has not yet received a copy, I invite you to visit the Company's website, w. w. w. Altera's core.com, where you'll find the release under Investor News in the Investor Relations section.
For turning the call over to management, I would like to remind everyone that some statements made during this conference call contain forward-looking statements based on current expectations. Actual results could differ materially from those projected as a result of various risks and uncertainties. The potential risks and uncertainties that could cause actual results to differ materially include the impact of COVID-19 related supply chain disruptions, potential reductions and ramp in revenue from key customers, acceptance of new products on a global basis and uncertain global economic conditions. The Company cautions investors not to place undue reliance on forward-looking statements, which reflect the Company's analysis only as of today's date Company undertakes no obligation to publicly update forward-looking statements to reflect subsequent events and or circumstances. Further information on these factors and other factors that could affect Ultralife's financial results is included in the Company's filings with the Securities and Exchange Commission, including the latest annual report on Form 10 K.
In addition, on today's call, management will refer to certain non-GAAP financial measures that management considers to be useful and differ from GAAP. These non-GAAP measures should be considered as supplemental to corresponding GAAP figures.
And with that, I would now like to turn the call over to Mike.
Michael Manna
Good morning.
Thank you.
Good morning, everyone.
Welcome to our call and alternatives to Q4 and full year 2023 operating results.
Earlier this morning, we reported Q4 sales of $44.5 million and operating income of $3.6 million, delivering $0.18 EPS, which includes who did a great end to a tumultuous year we started 2023 here with a cyber attack that shut down operations for weeks in two of our sites then rallied throughout the year to post the highest full year revenue and profit level in over 10 years, a result of great teamwork throughout the business and supply chain. For the full year, we reported 158.6 million in sales with an operating income of $9.5 million, resulting in $0.44 of GAAP and $0.52 adjusted EPS. For the year, we improved gross margin for the business throughout the year, which was a key priority as we started 2023. I am pleased to say we're able to finish out the year with an initial paydown on our acquisition debt and increased our overall backlog sequentially from Q. three. I will turn it over to Phil to talk through the detailed numbers.
Phil Fain
Thank you, Mike, and good morning, everyone. Earlier this morning, we released our fourth quarter results for the quarter ended December 31st, 2023. We also updated our investor presentation, which you can find in the Investor Relations section of our website and plan on filing our Form 10 K with the SEC.
In early March, consolidated revenues totaled 44.5 million compared to 36.1 million for the fourth quarter of 2022, an increase of 23.4%. Government Defense sales increased 28.8% and commercial sales increased 20.2%. Revenues from our Battery & Energy Products segment were $35.7 million. The highest sales quarter in our history for this segment compared to 32.1 million last year, an increase of 11.1%. This growth was driven by the highest medical sales quarter since we entered this business in 2012, an increased 118% year-over-year. Medical sales in the fourth quarter represented 33.8% of total segment sales compared to 17.3% for the year earlier quarter. The increase in medical was partially offset by declines in government defense and oil and gas sales of 11.4% and 11.3%, respectively. The sales split between commercial and government. Defense for our battery business was 78 22 compared to 71 29 reported for the 2022 quarter and the domestic to international split was 48 52 compared to 55 45 last year, demonstrating the continued success of our global revenue diversification strategy. Revenues from our Communications Systems segment of $8.8 million more than doubled the 4.0 million we reported last year, primarily attributable to fulfilling long lead time orders of vehicle amplifier adapters to a global defense contractor for the U.S. Army in integrated systems of amplifiers and radio vehicle mounts to a major international defense contractor under an ongoing Allied country government defense modernization program on a consolidated basis, the commercial to government defense sales split was 62 38 versus 71 29 reported for the 2022 full year. Our total backlog exiting the fourth quarter was $103.5 million, representing a 2.4% sequential increase and remain diverse in nature across our commercial and government defense customer base through replenishment rate remains high and the backlog represents a very healthy 65% of TTM sales.
Our consolidated gross profit was $11.4 million, up 4.1% over the 2022 period. As a percentage of total revenues, consolidated gross margin was 25.6% versus 22.4% for last year's fourth quarter, a 320 basis point improvement. It increased 80 basis points sequentially over the third quarter. Gross profit for our Battery & Energy Products business was $9.0 million compared to 6.9 million last year, an increase of 29.6%. Gross margin was 25.2%, an increase of 360 basis points over 21.6% reported for last year's fourth quarter and an increase of 100 basis points over the 24.2% reported for this year's third quarter year over year and sequential increases were primarily due to improved price realization as well as a concerted effort to level load production more evenly throughout the quarter, resulting in labor utilization efficiencies and higher cost absorption for our communication systems segment, gross profit was $2.4 million compared to 1.1 million for the year earlier period. Gross margin was 27.2% compared to 28.7% last year, primarily due to inefficiencies caused by delays experienced in the receipt of certain components, partially offset by higher factory volume.
Operating expenses were $7.8 million, an increase of 0.1 million over the year earlier period as a percentage of revenues. Operating expenses were 17.4% compared to 21.8% for last year's fourth quarter of 440 basis points improvement, reflecting the sales leverage of our business model, the combined leverage of our 320 basis point gross margin improvement in our 440 basis points to operating expense to sales ratio resulted in an 8.2% operating margin on an absolute dollar basis. Operating profit improved $3.4 million over the 2022 fourth quarter to $3.6 million business interruption insurance claim pertaining to our Q1 cyberattack still remains in review and is not included in our 2023 results.
Our tax provision for the third quarter for the fourth quarter was $0.3 million versus 0.2 million benefit reported for the 2022 quarter. Computed on a GAAP basis, including the impact of interest expense to help finance the Accel acquisition and foreign currency gains and losses.
Net income was 2.8 million or $0.17 per share on a GAAP fully diluted basis. This compares to a loss of 0.2 million or a loss of $0.01 per share for the 2022 quarter. Excluding the provision for noncash U.S. taxes, expected to be fully offset by our net operating loss carryforwards and other tax credits. Adjusted fully diluted EPS was $0.18 per share for the fourth quarter of 2023 compared to a loss of $0.03 for the 2022 period. Adjusted EBITDA, defined as EBITDA, including non-cash stock-based compensation expense, was 4.7 million or 10.7% of sales compared to $2.0 million or 5.6% for the prior year quarter. For the full year, adjusted EBITDA is $15.7 million or 9.9% of sales compared to EUR6.6 million or 5% of sales for the 2022 year. This represents the highest TTM level that we have achieved in the last 15 years.
Turning to our balance sheet, we ended 2023 with working capital of $66.5 million and a current ratio of 3.8 compared to $50.1 million and 2.7 for 2022 year end. The major components of the $15.4 million increase in working capital include a 4.6 million increase in cash of $4 million increase in accounts receivable, a 1 million increase in inventory and a 5.2 million decrease in payables and accruals. With the strengthening of our balance sheet, we are positioned to continue to pay down of our debt, thereby reducing the costly interest expense, which represents almost $0.12 per share on a TTM basis going forward, our backlog, diversified end markets, growth initiatives and ongoing actions to improve our gross margins and further strengthen our balance sheet position. Us well to optimize the leverage potential of our business model.
I will now turn it back to Mike.
Michael Manna
Thank you, Phil. For the detailed review of the Q4 and full year 2023 results to review where we were when we entered the year in my initial assessment assessment of the 2023 priorities, number one, price realization, we have completed the pricing corrections we had scheduled with some long-term ID IQ contracts still active in price challenged. We are working material within product projects to improve gross margin on those specific products and will reprice future opportunities to extend the time horizon of the S&OP planning process.
In part procurement, we have a framework established. We'll continue to refine this process throughout 2024 and have upgraded supply chain resources that we expect to have impact this year and three, improve the process of launching our new projects. We've identified a few challenges in our processes and some system imposed waste work and refine processes to improve that flow. Currently, I stated increasing gross margin was a key focus across the business, and we accomplished a positive growth and positive trend throughout 2023. Remember, a great deal of our valuable resources were allocated to the recovery from the cyber event for much of the first half of the 2023 year, putting us two, four quarters behind my expected timetable as we enter 2024, the operational priorities are continued gross margin improvement through material cost deflation and lean productivity projects in both the battery and energy and communications businesses. Our sales priorities are to increase our engagement resource and grow the opportunity funnel of our major projects, including Thionyl Chloride cells eat for EL. 8,000 cases, one to three cells and packs and thin cell related designs.
On the materials side, supply chain is improving, but we are still far from pre-COVID lead times for components. So extending order visibility and forecasting is key in our S&OP process to mitigate parts shortages and maintain revenue levels.
Switching over, I'll provide a brief update on the organic growth projects for the businesses. On the communication system side, we have shipped our first substantial orders of EL. 8,000 server cases to several customers. We continue to get small orders from various partners. We've developed a new DC power supply that will allow the server to be used in vehicular applications, both military and commercial in nature, we have systems and tests to the DoD customer currently and expect that option to be available for mid-year production orders. To reiterate this system developed with our strategic partner allows high end computing power to be used in difficult environments on the edge in industrial, 5G and AI applications, truly bringing server level computational power to the point of use. We expect this product line to grow as new customers adopt it for their system use.
Secondly, on the battery energy side of the business, several projects continue to advance. We have production equipment in place for our Thin Cell to support customers in the medical wearable space and several applications in item tracking. Our partner in the medical wearable space is currently in FDA testing, which is a gating factor for production ramp. We will be attending the HIM show in Orlando next month where we'll continue to showcase our X. five power system for powered medical carts and launched the new X5 light variant for USB-C powered devices, one two three product line supporting IoT and illumination market opportunity. Sales funnel is growing with our XR. one two three cell offering over 30% more energy in the same footprint now available for sampling and production. Several Night Vision customers are reporting significant increases in usable runtime over competitors here one two, three age. Using this new cell, our improved vinyl chloride product line targeting monitoring and telemetry applications is in qualification and field testing with several customers. These qualification cycles are extremely lengthy, but we anticipate some initial production orders later this year.
Our development work on the conformal wearable battery continues, and we have successfully completed UNDOT. shipment testing a major milestone, which allows us now to ship batteries to customers for initial testing and functional feedback. We are working on completing the rest of the validation testing to enter US government first article testing, which is currently scheduled to start later this year, we have been informed by the U.S. government. They expect significantly lower production volumes of this product due to delays in the integrated visual Augmentation System, known as IVAS. currently under development by Microsoft. Nevertheless, we are in a strong position to bring this product to market for the U.S., government and other customers. We continue to work on advanced projects and business cases for items to accelerate the growth of both businesses. We have a development partner working with us in New York on advanced rechargeable cell designs with promising early results. As we progressively have more tangible items in the future. I will provide updates in future earnings calls with a great ending to 2023 and a strong Q4 finish strong backlog position and a positive trend of gross margin improvements. We are focused on continuing these efforts throughout 2024, with continued strong focus on lean and material deflation initiatives, we are targeting further sustainable gross margin improvements for both businesses, which will further improve generation of cash and allow us to continue to pay down at least our acquisition debt sales funnel and commercial opportunity pipeline growth is key for 2024 and beyond to keep our strong organic growth trajectory going as we have yet to fully utilize and realize the return from all our new product investments.
Thanks, everyone, for the attention.
That concludes the prepared remarks.
For today, and we'll go back to the operator for questions.
Question and Answer Session
Operator
(Operator Instructions)
Thank you again, ladies and gentlemen, if you'd like to ask a question, please press star one one on your telephone again, to ask a question, please press star one one one moment for our first question. Our first question comes from the line of Josh Sullivan from The Benchmark Company. Your line is open.
Josh Sullivan
Good morning, Mike. Phil, congratulations on the quarter here for our Thank you. And with the momentum here coming out of 23, you're pointing to double digit revenue growth and operating margins for 24 and onward in the presentation. How should we think of that Walker cadence in particular on the margin profile side here, looking ahead and what are the major hurdles to getting to that? Or I mean, you're obviously already on a good trajectory here, but do we need to see any of these specific development projects work out or is this just kind of naturally going to work?
Michael Manna
Well, we're there's always an organic growth funnel that we're somewhat due to our customers. I mean, there's very few products that we're bringing to market directly. So we're somewhat tied to their development cycle and long cycle. So there's always some risk there, but we have pretty good visibility to a lot of things going on. We have a good strong backlog currently and feel pretty good about the the position we're in.
Josh Sullivan
And then maybe just on the price realization you're seeing here that you mentioned the comments. Can you just kind of expand on the contract negotiations and what we might expect to see this year?
Michael Manna
Well, as I stated, there's still some some IDIQs for both businesses that were negotiated, you know, two, three years ago that are still active in out years of the ID IQs, but price challenge because of when they were negotiated in some cases, we've been able to just cancel. In other cases, the government's taken a harder stance and not it really allowed much to happen there. So we're doing our best to make sure that we're profitable on all those cases and continue to move forward and provide the products that our war fighter needs to survive.
Josh Sullivan
And then maybe on the supply chain improvements you're seeing where the biggest improvements in the quarter, maybe where some of the bottlenecks as we head into 24. And then you talked about lead times there and then I think you also talked about maybe a certain component that was delayed in the quarter.
Michael Manna
Yes, the biggest the biggest real improvement was really when we started our S&OP process after the cyber event, we kind of got hit in the mouth and we're kind of flat-footed going into the year. But our S&OP process really started to flourish in midyear. So as you get into Q4, you've now had a good strong six months of strong forecasting and forecast, not only from our customers all the way through to our supply chain. It just really eases the burden of visibility. You can get ahead of some of the orders and you're not expediting parts because you were ordering them within the normal lead time of the parts.
Josh Sullivan
Got it.
And then maybe just got it.
Phil Fain
This specific example I called out and I'll just give you a it just happens, but maybe infrequently, but it still happens during the course of a quarter where you're waiting a long time, have a long, long time lead items, it's months and months and months that used to be weeks. You finally get the part and it doesn't pass incoming inspection and you just want to if you just want to rip your hair out when that happens and that that does happen, it happened several times during the quarter. And those are they're not they're not day-to-day issues that we're fighting, but they happen every couple of weeks. So that is it forces our S&OP process to go deeper into the supply chain and to be much more interactive with much more face-to-face contact with our vendors.
Josh Sullivan
And then maybe just switching over to some of the products on the email server cases, how are those small orders developing? And then do you think they lead into larger orders? Are those different customers? And maybe what the timeline is well, and the answer is yes.
Michael Manna
I mean, there's kind of a groundswell. We just got through some of the some of the qualification early last year. It takes a little bit of time for those customers to get it through. Our strategic partner actually has a pretty lengthy server backlog right now. So I think right now, if you would order server, it's going to be about four to six months before you actually get the blade from then. So there's a little bit of an inherent lead time built into the case need because of the server timing, but we expect it to continue to grow and be a significant piece of our business going forward.
Josh Sullivan
Right.
And then the option that is coming available midyear so how do you think that will drive sales or what is the the key incremental there?
Michael Manna
I think that's probably initially going to be more on the military side of the business.
There's just a lot of need for computational power on the battlefield Ford field, especially now that there's a lot of electronic jamming and communications give away position and et cetera. Et cetera. They want to do a lot more local to the events and operations that are going on. And really the DC power supply enables and put it in on a normal Humvee or tracked vehicle and operate for Ford field.
Josh Sullivan
And then just one last one, just on the thin cell, the medical wearable partner that's working through the FDA testing. What you think the time line on that, it looks like?
Michael Manna
Well, we were hoping we were going to be in production last year. So obviously, we're not showing a huge revenue spike in thin solar or really announcing anything. So what you have days of physical process, we've been through with a lot of our customers, sometimes you get through it and six months sometimes it takes four years. Unfortunately, it's another one of those processes I stated earlier. We're kind of hostage to our customers' time line and their successes in that regard.
But we're poised and ready to go get up to automated equipment is in place, and we're ready when the orders come in.
Josh Sullivan
But Bill, thank you and thank you for the time short session.
Operator
Thank you. One moment, please.
Our next question comes from the line of Brett Davidson of invest reading. Your line is open.
Good morning.
I got just a couple of quick questions. One of them is where are you guys at in regards to production capacity right now?
Michael Manna
Our production capacity, we're still pretty low.
I mean, as far as our overall ability to serve. We're pretty much a first shift operation worldwide. I mean, we have a lot of open capacity as far as footprint and building space. So you know, if I had to guess we could easily add another 30% capacity just on first shift, maybe even more than that. And then we still have the option of going the alternate shifts additional shifts to probably triple our capacity if we needed to.
And I know you guys have gone through some growing pains, introducing some of those new products regarding operating efficiency, where where are you guys in that process right now?
If you could put like kind of a percentage number on it or if you were at 50% before, are you guys at like 85% now or what does that look like?
It's a little hard to nail down because there's so many different products and projects going on. But if I had to guess we're in at 80% range probably, but some projects are probably closer to 95 and some are probably still closer to 20 at this point. So a lot of things going on. And we're trying to prioritize obviously, the highest revenue of more land or more resource intensive projects first.
So we can see the maximum benefit and on some of those like maybe some of the things more like the 20% level. I mean, do you guys still have some low hanging fruit that you can easily address to ramp up the efficiencies?
Well, absolutely. I mean that the real challenge is now that we've become a lot more medical involved in some of our other customers. I mean, the medical process to just change their process or product is just a lot more lengthy than in some of just the industrial other projects that you deal with. There's just a really long qual and supplier approval process to really go through any type of change. So even though we have the best intentions, sometimes what you think's a simple change that should take a quarter we take three just because you have to get resources from the customer to actually prove it and actually give you the green light to implement it.
All right.
Phil Fain
Thank you.
I appreciate your time.
Phil Fain
Sure. Thank you.
Operator
Thank you. Once again, ladies and gentlemen, we'd like to ask a question. Please press star one one on your telephone. Again to ask a question please press star one one one moment, please.
Our next question comes from the line of John Deysher of Pinnacle. Your line is open.
John Deysher
Hi, good morning. Thanks for taking my question. Looks like a solid quarter and a nice way to wrap up the year.
Just a couple of quick questions. One, what what is driving the medical sales? Obviously that helped you a lot in the last quarter. And I'm just curious, are there any specific items that really helped boost the sales in that segment?
Well, we have some recurring products that are under FDA and other things are under a battery replacement cycle. Obviously, we had a lot of sales and medical during COVID. So you have some of that coming due where you get a little bit of a bump because there's a replacement being used. But in a lot of cases, our main customers have had their competitors have footfalls. And in some cases, recalls and other things that have really driven their businesses to grow a lot faster than I think, even a lot, which we are a beneficiary of.
Okay. What's the cycle time for the ones that you have put into place during COVID as it four years or so or how does that work?
Typically, the ventilation devices are a three, three year cycle typically, and that's the that's the key product line is the ventilation products.
It's one of our more prevalent line, Jeff, I would say, but we do a lot with infusion pumps and other medical power. So it's spread across a bunch of different devices.
And what percentage of the backlog would you say is medical right now?
Phil Fain
Roughly?
I would say probably 30% just off top of my head, but I don't actually have the number right in front of me, but and that's helpful.
Tom, you mentioned business interruption claim isn't under review what's the approximate amount of that claim right now?
Phil Fain
While we haven't we haven't disclosed that, but you can you can look at our quarterly results and you can use intuition and determining what that is because if you look at the last three quarters, I will start with Q. one Q. one, we had 32 million in sales in the last three quarters we averaged call it $43 million and over in Q1, whereas we were breakeven on the bottom, we averaged 3 million on an average per quarter over the last three quarters. So without giving you an absolute number of what our insurance coverages and all that, it sits in that range.
Okay.
Phil Fain
Got you.
And when do you expect to have that resolved?
Phil Fain
That is a great question six months ahead of us. And I would say hopefully soon, you know, it's been information intensive providing as much detail as we possibly can which we look at as a top priority because it's certainly cash that we would love to see a hill along with our ERC claim that would go directly towards the pay down of our debt.
Okay, fine.
Phil Fain
So ARC claim, which claim is that the ARC claim is a claim that we filed in June with the IRS and we disclosed the amount the amount was approximately $1.5 million that we that we recognized in Q2 similar to the business interruption claim, along with everybody else, we're waiting for the refund check to come from the IRS.
Got you.
That makes sense. And finally, you say you've done a good job of paying down the debt from the acquisition. I'm just curious how much availability do you have on the credit facility now as of year end?
Phil Fain
Well, we have actually quite a bit and let me let me let me define that or we have an accordion feature that we can call into play if we needed $15 million, which which we don't because we're generating of some some very good EBITDA, we could certainly work with the bank to use the accordion feature that some of that's in our revolver, our revolver credit credit loan. So you have the $50 million accordion, but not only that you have an accordion that could get us that could get us to that level, provided that there was a really great reason an underlying strong business reason that we could that we could that we see. But then again, we would compare that to other financing alternatives. It's as we go through our normal due diligence, whether it's CapEx, whether it's acquisitions, whatever it may be one of the the and I'll just have to mention this because I preach this all the time the cheapest financing that we have is working down our inventory which which we very successfully did in Q three of in Q4 versus Q. three, working down inventory by approximately US of 4.7 million from Q. three.
Okay. So exercising the accordion, which it sounds like a special circumstance, a facility on. Is it fair to say that there's no availability under the current term loan or that now?
Phil Fain
We certainly we certainly have availability. We're not we're not by any means capped out.
Okay.
What is our availability both on the term loan and the revolver?
Phil Fain
Yes, the availability before we would use the accordion feature, if we decided to is over 5 billion, 5 million availability, I guess that's primarily on the revolver.
Yes.
Okay.
So you've got 5 million on the revolver availability Yes. Right now.
Okay, great. Thank you very much.
Phil Fain
Okay. Thank you, sir.
Operator
Thank you, ma'am.
Right.
Operator
Our next question comes from the line of Albert Rocco of.
So your line is open.
Hi, good morning.
Phil Fain
This is Al Rocco. I'm just wondering if you've ever looked at providing battery cells to the auto industry?
Well, we provide a lot of battery packs into that industry. Currently, we are partnered with cell providers that actually we use in that marketplace. We thought about it. It's a very long cycle. And typically, you know, you're at least three or four years of cell development and another two or three years of downhole testing before you really get what I would call approved. And you really have to have a partner that's willing to put the product downhole to do all the testing and qualification. So and it's always being thought about. So I'll say that.
Operator
Okay.
I guess wish you luck in finding a partner who need the domestic provider, I would assume you're well positioned there.
Operator
Sure.
Phil Fain
Thank you. Great quarter projects. Thanks so much.
Operator
Thank you again, ladies and gentlemen, like to ask a question, please press star one one on your telephone. Again to ask a question, please press star one one one moment please.
Our next question comes from the line of Stewart Johnson of the Sichuan Co., your line is open.
Phil Fain
Good morning, gentlemen. Nice presentation and a good quarter. My question has to do with your conformable wearable battery, how significant a percentage contribution to your bottom line is the conformable wearable battery? And secondly, how significant is the Microsoft delay?
Well, right now it's zero contribution to our bottom line on.
Phil Fain
We sell on time potential?
Michael Manna
Well potential.
I mean, we had a very large award that it's an ID IQ. So there's a potential, very large number out there who might ultimately with NEIDIQ., and we've lived them and in and out of this building for all the businesses, it's it's basically a hunting license to actually get business. It doesn't actually guarantee you're ever finish Unit one order let alone the revenue. So I mean, we've kind of always put it off is to it's going to be a good opportunity we have other commercial and other government customers that would love us to be in a production capability mode with that product, then we believe we're going to bring it to market successfully and it will be a contributor to our bottom line.
Phil Fain
Are there still, I believe four companies competing for this. There were four awards.
We're not really privy to where the others actually are the only thing we've been told is no one else is through fast. So no one else has actually qualified at this point. That's the only thing I don't know if I have no timetable on expectations, obviously, no, I mean, there's been some rhetoric around when the IVAS. system is going to be out in the field trials and other things, and I'll leave that to for you to look up on your own.
There's also another couple of government projects, net Warrior and some other advanced weapons and night-vision systems that are scheduled to use the the conformal product just not in the volumes and I've asked obviously would be using.
Jody Burfening
Thanks a bunch.
Phil Fain
Have a great day. Thank you.
Sir.
Operator
Thank you. I'm showing no further questions at this time. I'd like to turn the call back over to Mike Madacy you for any closing remarks.
All right.
Thanks, everyone, for listening to today's call, and we look forward to talking to you next time during the Q1 2024 earnings call. I won't have a great day and be safe.
Operator
Thank you.
Ladies and gentlemen, this does conclude today's conference. Thank you all for participating. You may now disconnect and have a great day.
