Good day ladies and gentlemen. Thank you for standing by. Welcome to the Aviat Networks’ First Quarter of Fiscal 2014 Earnings Conference Call. During today’s presentation, all parties will be in a listen-only mode. Following the presentation, the conference will be opened for questions. (Operator Instructions). This conference is being recorded today, October 30, 2013. I would now like to turn the conference over to Peter Salkowski, with Aviat Networks Investor Relations. Please go ahead, sir.

Thank you. Good afternoon everyone and welcome to Aviat Networks fiscal first quarter 2014 earnings call. I am joined today by Mike Pangia, President and Chief Executive Officer and Ned Hayes, Senior Vice President and Chief Financial Officer. During today’s call, management may make forward-looking statements regarding Aviat’s business, including statements relating to projections of earnings and revenues, business drivers, the timing and capabilities of new products, network expansions by mobile and private network operators and variations of economic recovery in different regions. These and other forward-looking statements involve assumptions, risks and uncertainties that could cause actual results to differ materially from those statements. Please note that these forward-looking statements reflect the company’s opinions only as of the date of this call and the company undertakes no obligation to revise or publicly release the results of any revisions to these forward-looking statements in light of new information or future events. For more information, please see the press release and filings made by the company with the SEC. These can be found on the Investor Relations section of Aviat Networks’ website at www.aviatnetworks.com. In addition, during today's call, management will be referencing to both GAAP and non-GAAP financial measures, a copy of the press release and financial tables which include the GAAP to non-GAAP reconciliations and other supplemental financial information is available on the Investor Relations section of the company’s website. I would now like to turn the call over to Mike Pangia.

Thanks Peter. Today we announced our first quarter of fiscal year 2014 results. Total revenue for the quarter was $93.4 million resulting in a non-GAAP EPS loss of $0.13. Revenue for the quarter was slightly below the bottom end of our revised guidance issued on October 3rd. I want to be upfront in saying that I consider the first quarter mix relative to our guidance to be a serious issue and I am disappointed by the results. We’ll discuss reasons for the top-line shortfall, but in any case given our expectations for the near term we are actively formulating plans that further optimize our cost structure and lower the company’s revenue breakeven level. Ned will speak more to that later on the call. That said I do not believe our fiscal first quarter performance is reflective of Aviat’s broader market opportunities. Our medium and long term outlooks for the global microwave industry are still strong based on the increasing availability smartphones, tablets and the accelerating demand for data and connectivity. And in non-mobile our positive outlook is based underneath for network modernizations across multiple segments. This is expected to drive demand from microwave backhaul on a global scale. I first like to cover the reasons for the lower than expected first quarter results. Although we were already expecting a seasonally lower fiscal first quarter, the rebidding of a large contract with a new customer in Asia was anticipated to contribute revenue in the quarter. The contract valued in the mid to upper single digit millions is for a standalone order. Several small factors, primarily in North America also contributed to Aviat’s lower fiscal first quarter revenues. Our first quarter revealed two things. First that sales cycles have lengthened. And second the amount of business to be booked and ship within…

Thanks Mike. Aviat’s GAAP financial statements along with the reconciliation of non-GAAP financial measures are included in the company’s press release issued today following the markets closed. I would like to take a few minutes to summarize our non-GAAP financial performance at a high level. The key figures were; the company’s book-to-bill ratio in the fiscal first quarter was slightly above one. Revenue for the first fiscal quarter came in at $93.4 million, slightly below the revised guidance range provided on October 03, 2013. 68% of revenue was derived from product sales and 32% from services. During our first fiscal quarter, we saw significant quarter over sequential quarter revenue declines in North America and Europe with some sequential quarterly growth in our Middle East Africa region. In North America we saw revenues decline sequentially from $47.5 million in FQ4 of last year to $33.7 million this quarter with sequential declines largely seen in our mobile and public safety businesses. These declines were observed in both our product and services revenues and I will speak more in a few minutes regarding how this revenue decline in North America adversely impacted our overall margins for the quarter. On the mobile side, operators step back from the very high levels of LTE network deployments we observed in the second half of our fiscal year 2013. Further, in the North America region, we do not have the usual large non-mobile transactions delivered into revenue as we have seen in recent quarters. In the public safety vertical, we saw a number of projects and their associated revenues deferred due to project complexity, customer acceptances and revenue recognition criteria. In Europe, revenues were down sharply, sequentially from $17 million in FQ4 of last year to $8.6 million in our first fiscal quarter. This decrease was largely…

Thanks, Ned. Despite a disappointing fiscal first quarter, the guidance has provided by Ned indicates a sequential improvement from the first quarter to the second quarter and we anticipate a stronger second half. The growing demand for connectivity and capacity worldwide combined with the company’s leading position in non-mobile segments, brand recognition, and relative financial strength we believe the medium and longer-term prospects for Aviat Networks remain promising. Notwithstanding we understand that this is a top business. We are conservatively planning for a slow telecom CapEx recoveries and longer sales cycles. As a result, we are undergoing a deep dive review of our revenue and investment opportunities, including evaluating the structure of our business, the markets we’re operating in and the next steps to take in product development once the refresh is complete. The outcome will be leveraging our strongest attributes towards the highest probability of success. Now I’d like to turn the call over for questions. Operator, you may now proceed with the Q&A.

(Operator Instructions). Our first question comes from Rich Valera with Needham & Company. Please go ahead. Rich Valera - Needham & Company: The question around your backlog and the amount of turns business you expect to have to do. You obviously got a pretty good run there. We had many quarters of positive book-to-bill frankly at revenue level much higher than this which might have led one to believe you are actually building up some backlog, a bit of a cushion if you will. So just trying to understand how the revenue drop so quickly, have you lost any backlog or is anything happened to that or is it just sort of there is always an upturn in business that could happen? And secondly, I think you said some of the effects (inaudible) that you expect a higher level of turns business going forward. I wasn't sure what that was referring to, is that just in the next quarter or two? Or do you see the business changing structurally where it's you just expect to get fewer long-term orders going forward? Thanks.

Yes. So Rich, I think your point about the backlog, again our backlog is when we talk about backlog, we talk about backlog in terms of entering the quarter and when there is backlog associated with turning over a much longer period. So the backlog entering a quarter has declined over the course of the last several quarters. In particular, it entering a quarter probably drop a couple of quarters ago and as a result, I think you saw the revenues starting to decline as a result of that. It does also lend itself to the conversion from bookings to revenue also has extended and the combination of the two is what has put us into our current revenue situation. Now having said that, we do expect the backlog to start growing again with the pipeline from opportunities in front us, and to the extent that that’s non-mobile, then the conversion rate will also be extended so that does means that the recovery will be a slower progress going forward. The only other point I'll make is bookings that Ned had mentioned. We have seen in the last couple of quarters more of a back ended bookings which makes it more difficult to book and ship in the quarter. Rich Valera - Needham & Company: So I guess going forward at least for the foreseeable future you kind of expect to be running with more of a turns driven model maybe than you would have several quarters ago before this phenomenon started happening, is that fair?

Yes. Rich Valera - Needham & Company: And then I hear your commentary on the $100 million trying to get a sense of and maybe this is too early, but how do you get cut yourselves. You have taken a couple of major cuts with the expense structure since you guys have been there and obviously if you don’t do it right, you can really impact the growth. So I am just wondering where if you can say where you hope to kind of trim if you will to get down to that $100 million breakeven level?

Ned, I want you to start it out.

So I think Rich there are a number of different levers and I don’t think you should necessarily think that it’s all going to be coming out of operating expense. So we certainly do see improvement in gross margins and that’s going to help us to some extent. But we also do have relatively high fixed cost structure above the gross margin line in terms of operations and services. And then again with the implementation of Oracle R12 here, we've actually got a number of overlap in resources that will be tailing off and actually leaving the cost structure here between now and the end of the year. We’ll also be looking very surgically at where our go-to-market model. We want to make sure that the monies that we’re replacing are going to have the return on investment that we believe and that return on investment isn’t just top line, but also margin. We want to make sure that those new markets have the commercial attributes that we wish to have. We’ll be taking a look at that. And then as we finally come to the completion of the refresh of our overall product line, I think we have opportunities to revisit what that cost structure looks like, especially from productivity standpoint.

Got it. I think just to make it clear that clearly we will not be taking any actions that would put any of our new product introductions at risk. So preserving our investment in R&D until such time that we can then look at opportunities to either be more productive or efficient or get smarter on what we do versus partnering opportunities. We’ll make sure that that remains intact.

But I think the real key here is more flexibility versus fixed nature of our cost structure that we see today, which again had a very negative impact on our margin rates in the last quarter with the volume downturn. Rich Valera - Needham & Company: Understood. That does make sense gentlemen. Certainly good luck on your implementation of those plans. Thank you.

(Operator Instructions). Mr. Peter, there are no further questions at this time, please continue with any closing remarks.

Thank you, Operator. Before closing the call, I would like to everyone know that Mike and Ned will be at the Needham Growth Conference being held in New York, January 14 to the 16th in Palace Hotel. We will publish it probably in December with the exact date and time of the company presentation. With that, I would like to thank everyone for participating today and thank you much for your interest in Aviat Networks. Operator, you can close the call.

Ladies and gentlemen, this concludes the Aviat Networks first quarter of fiscal 2014 earnings conference call. This conference will be available for replay after 6:30 PM today through November 6, 2013 at midnight Eastern Time. You may access the replay system at anytime by dialing 1800-406-7325 and entering the access code of 4644146. Thank you for your participation. You may now disconnect.