Daktronics, Inc.

Good day, ladies and gentlemen, and welcome to the Daktronics Fiscal Year 2023 Third Quarter Earnings Conference Call. As a reminder, this conference is being recorded today, Wednesday, March 8th, and is available on the company's website at www.daktronics.com. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising you your hand is raised. To withdraw your question, please press star 11 again. I would now like to turn the conference over to Ms. Sheila Anderson, Chief Financial Officer for Daktronics, for some introductory remarks. Please go ahead, Sheila.

Thank you, Michelle. Good morning, everyone. Thank you for participating in our third quarter earnings conference call. I would like to review our disclosures cautioning investors and participants, but in addition to statements of historical facts, We will be discussing forward-looking statements reflecting our expectations and plans about our future financial performance and future business opportunities. All forward-looking statements involve risks and uncertainties which may be out of our control and may cause actual results to differ materially. Such risks include, but not limited to, our ability to obtain additional financing on terms favorable to us or at all, changes in economic conditions, changes in the competitive and market landscape, including impacts of global trade discussions and policies, the impact of governmental laws, regulations, and orders, including those resulting from pandemics, disruptions to our business caused by geopolitical events, military actions, work stoppages, natural disasters, or international health emergencies such as the COVID-19 pandemic, any future goodwill impairment charges, management of growth, timing and magnitude of future contracts, fluctuations of margins, availability of raw materials, components, and shipping services, the introduction of new products and technologies, and other important factors. These identified important factors could cause actual results to differ materially from those disclosed in this call in the company's third quarter 2023 earnings release and its most annual report on Form 10-K. We refer you to these documents. Our third quarter 2023 earnings release contains certain non-GAAP financial measures and was furnished to the SEC Securities and Exchange Commission on a form 8K this morning and is available on the investor section at the Daktronics website at www.daktronics.com. I'll turn the call over to our CEO, Reece Kurtenbach.

Thanks, Sheila. Good morning. Thank you for joining us today. Our past actions to carefully match our production schedules, inventory, and labor to demand fulfillment were successful as measured by the increase in sales and generation of operating income for the third quarter. The pandemic recovery period was unprecedented. The last 24 months were marked by historically high demand while experiencing persistent instability of supply chains, a tight labor market, and inflationary conditions. We are seeing supply chain conditions easing, which supports a more stable production schedule. We have also increased production capacity to match market demand, which was achieved despite labor shortages and long cycle times for the technology and fixed assets necessary to increase output on an ROI positive basis. Operating margin improvement was achieved because of a more stable environment, pricing actions that we took in light of supply chain conditions and inflationary pressures, product mix adjustments, and prudent management of operating expenses. Quoting activity and sales opportunities remain active, resulting in an order volume of 148 million for the quarter. Fiscal year 22's levels were partially attributed to pent-up demand. As a comparison, orders for the fiscal 2020 third quarter, the last quarter prior to the onset of the pandemic, were 135 million. During the past quarter, our team focused on our liquidity enhancement program and working capital improvements, as evidenced by the lowering of inventory levels and their attention to billings and collections of accounts receivable and deposits. I appreciate the efforts of our teams across the company have made to come together to solve these challenges and to serve our customers. I'll now turn it over to Sheila for some more details on the financial results.