AstroNova, Inc.

Good day and welcome to Astronova's third quarter fiscal 2022 financial results conference call. Today's conference is being recorded. I would now like to turn the conference over to Scott Solomon of the company's investor relations firm, Sharon Merrill Associates. Please go ahead, sir.

Thank you, John. Good morning, everyone, and thanks for joining us. Hosting this morning's call are Greg Woods, Astronova's president and CEO, and David Smith, the company's chief financial officer. Greg will discuss the company's operating results. David will take you through the financials at a high level. Greg will make concluding comments. And then management will be happy to take your questions. By now, you should have received a copy of the earnings release that was issued today. If you do not have a copy, please go to the investors' page of the Astronova website, www.astronovainc.com. Please note that statements made during today's call that are not statements of historical fact are considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1934. These forward-looking statements are based on a number of assumptions that could involve risks and uncertainties. Accordingly, actual results could differ materially except as required by law. Any forward-looking statements speak only as of today, December 8, 2021. The company undertakes no obligation to update these forward-looking statements. For further information regarding the forward-looking statements and the factors that may cause differences, please see the risk factors in Astronova's annual report on Form 10-K and other filings the company makes with the Securities and Exchange Commission. On today's call, management will be referring to non-GAAP financial measures, including non-GAAP net income and non-GAAP net income per diluted share. Astronova believes that the inclusion of these measures help investors gain a meaningful understanding of the changes and the company's core operating results, and also can help investors who wish to make comparisons between Astronova and other companies on both a GAAP and a non-GAAP basis. A reconciliation of these non-GAAP measures to their most directly comparable GAAP measures is available in today's earnings release. And with that, I'll turn the call over to Greg.

Thank you, Scott. Good morning, everyone, and thank you for joining us. As you mentioned in this morning's press release, we continue to see global demand growth for our products and services. And overall, our teams performed well in the third quarter, despite a number of supply chain constraints that affected our results. Total revenue in the quarter increased 3% year-over-year to $28.9 million. The continued rebound of the commercial aviation market helped us deliver sequential and year-over-year growth in our test and measurement segments. Revenue in the T&M segment increased 35% in the third quarter to $6.9 million, making it the best quarter since last year's first quarter. This more than offset a slight decline in the product identification revenue, which was down 4% to $21.9 million. Our strong third quarter bookings came in at a $32.3 million rate, up 16% year-over-year and up 6% sequentially from Q2. A big challenge for us during the quarter was the difficulty in obtaining certain electronic components, which prevented us from making several late-quarter shipments. However, thanks to our materials teams, we have since received the majority of the delayed components and expect to ship those held-up orders in the fourth quarter. This includes revenue from the new multi-year government program I referenced on our last call, a program that involves supplying advanced data acquisition equipment for aerospace and defense applications. Looking at revenue by type, supplies and hardware revenue remain roughly flat with the third quarter of fiscal 2021, while service and other revenue was up 35% from the same period last year, the bulk of which was in T&M. From a geographic perspective, U.S. revenue accounted for approximately 60% of our total sales in Q3. We continue to strengthen our product identification teams both domestically and internationally. For example, We recently hired a head of production responsible for our growing media business in Europe, Middle East, and Africa, and new initiatives there are beginning to generate positive results already. On our Q2 call, I noted that we had begun to return to in-person meetings and trade shows. During the third quarter, we exhibited our latest printing and labeling products at a number of in-person events. These included two major trade shows, the Pack Expo and Healthcare Packaging Shows in Las Vegas, and FACFAC, the European Trade Fair for Packaging in Nuremberg, Germany. Attendees had the opportunity to demo our industry-leading technologies, including the QL120D, the QL850, the QL300, and the T2C, as well as our new T3-OPX direct-to-package printing system. We also engaged in great discussions with our current and prospective customers about how our product identification solutions play into global trends related to digital print for packaging and environmental sustainability. Since the end of Q3, we have also participated in some smaller regional shows in North America, Europe, and Asia. As a matter of fact, we have one going on right now in New York City. While we are being judicious, about adding trade shows related to expenses, early indications are that the quality of leads generated from these shows continues to be very high because the attendees are there for solid business reasons. Going forward, we plan to pursue a hybrid marketing approach that combines both select high-value in-person events as well as continued growth in our digital marketing platforms. On the digital front, We will continue to expand our e-books, case studies, support videos, and other cost-effective digital tools that have proven successful in enhancing our sales and customer support activities. Looking ahead, we expect revenue to increase on a sequential and year-over-year basis in the fourth quarter of fiscal 2022. Now let me turn the call over to David for the financial review.