inTest Corporation

afternoon ladies and gentlemen and welcome to the intest corporation second quarter fiscal year 2022 financial results conference call during the presentation all participants will be in a listen-only mode afterwards we will conduct a question and answer session at that time if you have a question please press the one followed by the four on your telephone if at any time during the conference you need to reach an operator please press star and zero as a reminder this conference is being recorded I would now like to turn the call over to Deborah Pawlowski, Investor Relations. Please go ahead.

Thank you, and good afternoon, everyone. We certainly appreciate your time today and your interest in Intest Corporation. Here with me are Nick Grant, our President and CEO, and Duncan Gilmore, our Chief Financial Officer and Treasurer. You should have a copy of the second quarter 2022 financial results, which we released just after markets closed today. If not, you can access the release, as well as the slides that will accompany our conversation, on our website at ir.intest.com. After our formal presentation, we will be opening the line for Q&A. If you'll turn to slide two in the deck, I will first review the Safe Harbor Statement. You should be aware that we may make some forward-looking statements during the formal discussions, as well as during the Q&A session. These statements apply to future events that are subject to risks and uncertainties, as well as other factors that could cause actual results to differ materially from what is stated here today. These risks and uncertainties and other factors are provided in the earnings release, as well as with other documents filed with Securities and Exchange Commission. These documents can be found on our website or at sec.gov. During today's call, we will also discuss some non-GAAP financial measures. We believe these will be useful in evaluating our performance. You should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP. We have provided reconciliation of non-GAAP measures with comparable GAAP measures in the tables that accompany today's release and in the slides. So with that, if you will turn to slide three, I will turn it over to Nick to begin.

Nick? Thank you, Deb, and good afternoon, everyone. Thanks for joining us for our second quarter 2022 earnings report. The quarter played out better than we expected with both top and bottom line results exceeding our guidance. This was truly notable when you factor in ongoing supply chain constraints, transportation challenges, and continued inflationary pressures the organization had to overcome. I would like to thank the entire Intest team for delivering an outstanding quarter. We continue to advance our five-point strategy and we are executing well. Revenue grew 36% year-over-year and 23% sequentially to a record level of 29.6 million. Organically, revenue grew an impressive 12% year-over-year. These strong results continue to show increasing demand for our innovative and differentiated solutions. Acquisitions contributed 5.2 million in revenue in the quarter, with demand across most of our end markets. Double-digit organic growth reflected our increasing presence in automotive EV and our industrial markets. We believe that our diversification efforts around our targeted growth markets are working well. This is demonstrated by our strong sales of our leading test and process solutions to the automotive industry, including electric vehicles. In fact, compared with the prior year period, we saw sales for automotive quadrupled to 3.6 million, of which 57% was related to the EV market. Sales to the industrial market were also quite strong, up 92% to 2.9 million, and sales to the life sciences market doubled to 1.2 million. As we have been communicating, our diversification within CEMI is also providing benefits. Both sales and orders for our innovative solutions for the front end space, specifically in silicon carbide crystal growth applications, were up year over year and sequentially. This is important as these applications are a relatively new space for us with our induction heating solutions. For our back end semi-solutions business, sales were lower due to the atypical strength we saw during the first half of 2021. Yet orders for the second quarter rebounded strongly on a year-over-year and sequential basis. Gross margins stabilized at first quarter levels, but was down from a year-ago period. When comparing year-over-year, the change in product mix was the primary reason for margin contraction. This was mostly due to the strong back-end semi-business during the first half of 2021 that I just mentioned. Our custom engineered solutions in this backend test space generally tend to command our highest margins. Margins should improve as we drive productivity gains and as the investments we have made to grow revenue and realize operating leverage continue to pay off as we advance through the year. Integration of our three acquisitions that closed during the fourth quarter of 2021 is progressing well. These acquisitions, as planned, are strengthening as we implement process improvements, expand their sales efforts, and integrate them into our systems. We are identifying new opportunities and unleashing greater potential for our technologies. As a reminder, we began operating and reporting as three business segments this year. These segments align with our technology platforms of electronic test, environmental technologies, and process technologies. We believe this division structure enables us to increase efficiencies, broaden opportunities, better utilize our managers' talents, and leverage our strong customer relationships to accelerate growth and capture cost synergies. We also expect to be able to increase collaborations across the businesses, which will help us create broader customer solutions. Finally, with our new technology division structure, we believe we are well positioned to build our forward vision of innovative test and process technology solutions and the platform to support our growth ambitions. You can find the results by segment in our news release as well as in the supplemental tables of our slide deck. We had record orders of $40.5 million in the quarter, a record backlog at quarter end, and demand remains high as we move into the second half of the year. This provides us with the confidence to reaffirm our revenue guidance for 2022 and establish third quarter revenue guidance of approximately $29 to $31 million. With that, let me turn it over to Duncan to review the financials in more detail. Duncan, over to you.