Aviat Networks, Inc.

Good afternoon. Welcome to AVF Network's fourth quarter fiscal 2021 earnings call. At this time, all participants are in a listener limit. A question and answer session will follow the formal presentation. Please note, this conference is being recorded. I will now turn the conference over to your host, Mr. Keith Panaran, Vice President of Global Finance and Investment Relations. Thank you. You may begin.

Thank you and welcome to Aviat Network's fourth quarter fiscal 21 results conference call and webcast. You can find our Form 10-K press release and updated investor presentation in the IR section of our website at www.aviatnetworks.com, along with a replay of today's call in approximately two hours. With me today are Pete Smith, Aviat's President and CEO, who will begin with opening remarks on the company's fiscal fourth quarter. followed by Eric Chang, our CFO, who will review the financial results for the fourth quarter and fiscal 2021. Pete will then provide closing remarks on Aviat's strategy and outlook, followed by Q&A. As a reminder, during today's call and webcast, management may make forward-looking statements regarding Aviat's business, including but not limited to statements relating to financial projections, business drivers, new products and expansions, the impact of COVID-19, and economic activity in different regions. These... and other forward-looking statements reflect the company's opinions only as of the date of this call and webcast and involve assumptions, risks, and uncertainties that could cause actual results to differ material from these statements. Additional information on factors that could cause actual results to differ material from the statements made on this call can be found in our annual report on our Form 10-K filed with the SEC on August 25, 2021. The company undertakes no obligation to revise or make public any revision of these forward-looking statements in light of new information or future events. Additionally, during today's call and webcast, management will reference both GAAP and non-GAAP financial measures. Please refer to our press release, which is available in the IR section of our website at www.aviatnetworks.com, and financial tables therein, which include a GAAP to non-GAAP, reconciliation, and other supplemental financial information. At this time, I'd like to turn the call over to Aviat's president, CEO, Pete Smith. Pete.

Thanks, Keith, and good afternoon, everyone. Thanks for joining us to review a successful quarter. The company continued to execute on our key long-term focus areas of growth, margin expansion, expense reductions, and meaningful bottom-line improvements. The AVIAD team commitment resulted in fourth quarter and full fiscal year revenue growth of 14.4% and 15.2%, compared to the same periods last year. Fourth quarter and full fiscal year adjusted EBITDA margins of 9.7% and 11.9%. Our fiscal year 2021 adjusted EBITDA of 32.8 million and adjusted EBITDA margin of 11.9%. More than doubled fiscal year 2020 adjusted EBITDA of 13.5 million and adjusted EBITDA margin of 5.7%. a solid balance sheet and liquidity position with net cash at $47.9 million, growing by $2.1 million sequentially from the last quarter, and $15.3 million for the fiscal year with no loans outstanding. North American fourth quarter revenue increased 21.4% year over year, and for the full fiscal year 2021, North American revenue increased 20.7% compared to the same period last year. International fourth quarter revenue increased 3.5% year over year and full fiscal year 2021 international revenue increased 5.6% compared to the same period last year. Our full fiscal year 2021 revenue of $274.9 million exceeded the top end of our guidance of $265 million. Adjusted EBITDA was $7.0 million for the fourth quarter, representing an improvement of $1.4 million versus the same period last year. Adjusted EBITDA margins improved to 9.7% for the fourth quarter compared to 8.8% for the same period last year. Our full fiscal year 2021 adjusted EBITDA of $32.8 million exceeded the top end of our guidance of $31 million and more than doubled the fiscal year 2020 adjusted EBITDA of $13.5 million. The improvement in revenue and adjusted EBITDA for the fourth quarter and the full fiscal year was primarily due to gross margin expansion from higher volume of private network business, increased sales through our Aviat store, which serves primarily the rural broadband space, improved international business driven by multiband wins, and also software and license sales. We want to recognize our suppliers and the Aviat supply chain team for successfully navigating the current environment. Aviat's team performance has offset the difficult supply environment. On recent calls, I've talked extensively about our exciting new capabilities in software services and e-commerce, which continue to drive our success. Today, I'd like to explain some of the differentiation in our radio products, specifically the WTM 4000 platform, which has played a significant role in our recent growth in 5G and rural broadband. WTM4000 is an all outdoor ultra high capacity microwave, millimeter wave, and multi-band radio platform that has important differentiated capabilities compared to other radio platforms and achieves lowest total cost of ownership. We understand that customers buy systems, not chips, so we built what we believe to be the best system. The WTM4000 leads the industry in system gain enabling radio links to go further in distance, have a greater ability to overcome weather effects like rain, and use smaller antennas, which is an important element in Aviat's total cost of ownership value proposition. WTM4000 also has higher capacity in microwave bands for all practical use cases. Further, WTM4000 has a modular platform architecture designed from the ground up for system flexibility. Not only has this modularity allowed us to build the industry's only single box multiband radio. It also enables us to deliver variants of this quickly, as evidenced by our recent announcement of 11 gigahertz and 13 gigahertz multiband products, which we announced in the fourth fiscal quarter. Being less susceptible to rain than other bands, the 11 gigahertz multiband variant is particularly attractive, enabling extended distance and increased reliability of multiband links. which grows our addressable market, allowing us to sell more multivan in more places around the world. Platform modularity also allows us to mix and match transceivers, enabling 20 gigabits per second in a single box, which is twice the capacity of our competition. In addition to the recent wins at DISH, Safaricom, Nextlink, LTE Broadband, and other 5G and rural broadband accounts, the WTM4000 is responsible for some new contracts. New wins in Afrocell and Union Wireless were driven in part by the differentiated capabilities of the WTM4000 platform. We are also seeing positive activity with the platform internationally. In Asia Pacific, we have broken into two new countries with new operator wins based on our radio differentiation and have significant prospects for growth in the region. especially in segments where spectrum is expensive and operators are moving to 5G. In Africa this quarter, because of our multiband solution, we have gotten back into the access networks of two major tier one accounts in countries where we were shut out a number of years ago. We will continue to communicate more information about these international wins soon. We believe the WTM4000 platform is the most capable radio platform on the market today. We feel confident the platform's modularity will allow us to address customer economic issues as 5G and rural broadband evolves globally. We believe 5G builds will drive new backhaul upgrades and that our rural broadband business will benefit from meaningful government funding, including the $9 billion 5G Fund for Rural America and the $20 billion Rural Digital Opportunity Fund. On top of this, there is an additional proposed $65 billion for broadband funding included in the $1.2 trillion bipartisan infrastructure framework. In fiscal year 2021, Aviat added 150 new rural broadband accounts, growing our business significantly, and we are now the leading wireless backhaul provider to this segment in the USA. So we are well-positioned that this funding comes to fruition. Being an American company, Aviata is proud to deliver broadband connectivity to rural America, enabling economic, social, healthcare, and educational opportunities for all Americans. With respect to private networks, our business remains strong and is growing. Aviata has a highly differentiated offering. Our leading RF performance, along with our software and services capabilities, are keys to lowering TCO, and delivering value to our customers. In the quarter, we secured a new state government network in the U.S. and won a significant multi-year design and deployment project for a nationwide emergency services network in Western Europe. These public safety projects are great business for Avia and will drive revenue throughout fiscal year 22. Before turning the call over to Eric, let me provide a couple of additional observations and insights. First, this was a very good fourth quarter and full fiscal year. We remain focused and continue to execute, and those collective efforts are reflected in our financial and operational results. We've continued to demonstrate our ability to grow and to take a greater share of demand for the products and services we offer. Looking forward, we expect to continue to see three significant revenue drivers, 5G, private networks, and rural . And we believe we are well-positioned to capture significant opportunities with our differentiated products, software, and services offerings. With that, let me turn the call over to Eric to review our financials before coming back for some final comments.