Wireless Telecom Group, Inc.

Ladies and gentlemen, and welcome to the Q1 2021 quarterly earnings call. At this time, all participants have been placed on listen-only mode, and the floor will be open for questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Mike Kandel. Sir, the floor is yours.

Thank you, Paul. Good morning, everyone, and thank you for joining us on today's conference call to discuss Wireless Telecom Group's first quarter 2021 financial results. With me today is Tim Whalen, the company's CEO. Before we begin, I would like to remind everyone on the call that our remarks today could include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, such forward-looking statements may be identified by terms such as believe, expect, seek, may, will, intend, project, anticipate, plan, estimate, or similar words as well as statements that do not relate strictly to historical or current facts. The company's forward-looking statements are based on management's current expectations and assumptions regarding the company's business and performance, the economy, and other future conditions and forecasts of future events, circumstances, and results. Forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties that could materially affect actual results. Important factors that could cause the company's actual results to differ materially from those in its forward-looking statements include those risk factors set forth in the company's 2020 Annual Report on Form 10-K. The company does not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise. Also, we want to point out that in addition to GAAP information, we will provide information relating to certain non-GAAP measures. We believe that presenting these non-GAAP or adjusted measures provides additional meaningful information to investors, which reflect how management views the business. Detailed reconciliations of gap measures to non-gap measures are set forth in a reconciliation table in our press release issued earlier today and furnished with the form 8K filed today with the SEC. With that, it's now my pleasure to turn the call over to Tim Whalen. Thank you, Mike.

Good morning, everyone. 2021 is expected to be a very exciting year for Wireless Telecom Group after exiting 2020 with strong Q4 bookings and a higher backlog. And Q1 did not disappoint, coming in stronger than we initially expected. Our first quarter results showed strong performance across a number of metrics, continuing our momentum of successful new customer wins, improving bookings, and increasing gross margins. On a consolidated basis during the quarter, our revenues increased 20% compared to last year. We realized higher gross margins at 52.5%. We improved our EBITDA results at almost 6% of revenue, and we generated a second consecutive quarter of strong consolidated bookings at nearly 13 million, which led to another quarter of higher backlog. We are continuing to execute on our strategy of driving double-digit, top-line growth and operating leverage to drive increased profitability and cash flow. Turning to the highlights in our three product groups, in RF components, Our revenues in Q1 were consistent with Q4 and, as expected, decreased when compared to Q1 of last year. This reflects the continuing negative impact of the pandemic on Q1 of this year, with slowed investments in building out network infrastructure in empty office buildings, empty stadiums, and other large venues targeted by carriers, tower companies, and neutral host providers to densify the networks. Recall that the negative effect of the pandemic had more of an impact on the second half of 2020 than on the first half of 2020 for comparison purposes. We believe bookings and RF components have now started to rebound. In Q1 2021, we realized a positive book bill ratio and Q1 bookings were sequentially higher than Q4 2020 bookings. Further, the bookings for the month of April were also the best month of bookings in over 10 months. The relative improving strength of new business within RF components is a good early sign and supports our belief that we will see a steady recovery of demand for the critical components supplied by Microlab throughout the year as carrier investment ramps. The drivers to our assumptions for increasing demand includes pent-up demand from projects put on hold last year due to vacant building, stadiums, and other large venues, which are now expected to see returning occupancy in coming months. In addition, the carriers invested heavily in the mid-band spectrum auctions, which were completed in February of this year, and they have subsequently announced higher capex spend to deploy this spectrum. It is important to note that the design to build timeline can be lengthy, and we have not yet seen many large projects return to the funnel. so some of these large projects could extend into 2022 and beyond. In our test and measurement product portfolio, our Q1 results reflect the full quarter of ownership of the Holtsworth business, which has continued to perform well. We are realizing top-line synergies from an expanded product portfolio in our sales channels, and we are working to continue to leverage deep customer relationships in our existing brands. Our legacy smart noise sources and design-in initiatives also benefited from increased sales in the first quarter. Overall, we believe the alignment of our product set away from just the legacy benchtop instruments to our expanded focus on new products and solutions which are designed into larger, more complex devices is showing dividends. We remain focused on bringing new products to market which compete with larger suppliers by offering a superior price-performance ratio. And last, within our radio, baseband, and software business, we had another strong quarter of bookings and continued our momentum of signing new customers for our 5G software solutions. Specifically, within this product group, we signed over 4 million of business in the quarter, a second consecutive quarter of RBS bookings in excess of 4 million. We signed two new customers in Q1 for our software solutions, both of which are 5G solutions. And one of the two new contracts signed in Q1 includes participation in the U.S. Department of Defense 5G trials, while the second is for a specialized 5G small cell solution. The first purchase orders received for these two new software customers included in Q1 bookings totaled approximately $800,000. However, the potential total contract value of the contract signed could exceed $4 million of potential value over several fiscal years. We expect our performance and delivery of the project's milestones laid out in the contracts are expected to yield continued purchase orders for additional milestones. And, as noted in our last earnings call, We also received additional purchase orders in the first quarter for our hardware cards used in LTE test systems from our long-standing customer, who is realizing increased demand for base station test systems. Looking ahead into RBS, we expect to see continued interest in our 5G software solutions and R&D roadmap. We also expect to continue our pace of signing new customers in the quarters ahead, and I'm pleased to report that in the month of May, we have already signed one new customer to our 5G software solution with a contract value just under $1 million. To summarize, the first quarter 2021 results are a significant improvement over the first quarter last year. While certain parts of our business, such as RF components, are still showing the negative effects of the COVID-19 pandemic, we are optimistic the worst is over. We are seeing early signs of recovery and expect steady improvements throughout the year. At the same time, T&M continues to realize the benefits of a successful Holtsworth acquisition, as well as traction with our smart noise sources. And our RBS business continues to demonstrate significant quarterly sequential improvement and growth of new customers for our LTE and 5G software and services. With that, I'm going to turn the call back over to Mike to walk us through the financials. Thank you, Tim.