Welcome to inTEST Corporation’s 2015 Second Quarter Financial Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded. A replay will be accessible at www.intest.com. I would now like to turn the call over to Hugh Regan, inTEST’s Chief Financial Officer.

Thank you, operator and thank you for joining us for inTEST’s 2015 second quarter financial results conference call. Joining me on the call today are Robert Matthiessen, President and CEO; Jim Pelrin, Vice President and General Manager of inTEST’s Thermal Products segment; and Dan Graham, Senior Vice President and General Manager of inTEST’s Electrical and Mechanical Products segments. Bob will briefly review highlights from the second quarter as well as current business trends. And then I will review inTEST’s detailed financial results and then provide guidance for the third quarter of 2015. We will then have time for any questions. If you have not yet received a copy of today’s release, a copy may be obtained on our website, www.intest.com. Before we begin the formal remarks, the company’s attorneys advise that this conference call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements do not convey historical information, but relate to predicted or potential future events that are based upon management’s current expectations. These statements are subject to risks and uncertainties and could cause actual results to differ materially from those expressed or implied in such statements. Such risks and uncertainties include, but are not limited to changes in business conditions in the economy, changes in the demand for semiconductors, changes in the rates of and timing of capital expenditures by semiconductor manufacturers, the success of our strategy to diversify our business by entering markets outside the semiconductor or ATE markets, progress of product development programs, increases in raw material and fabrication costs associated with our products and other risk factors set forth from time-to-time in the company’s SEC filings, including, but not limited to, inTEST’s periodic reports on Form 10-K and Form 10-Q. The company undertakes no obligation to update this information on today’s call with respect to events or circumstances after the date hereof or to reflect the occurrence of anticipated or unanticipated events. And with that, let me now turn the call over to Bob Matthiessen. Please go ahead, Bob.

Thanks, Hugh. I would like to welcome everyone to our 2015 second quarter conference call. Well, Hugh will review the financial results in detail as he just said, I will review some of the highlights and then we will discuss our markets and what we are seeing in our customer base. We delivered another strong quarter increasing nearly all metrics and driven predominantly by strength in the telecom industry, where we are making head roads with a number of customers as well as the auto and industrial segments. On a sequential basis, second quarter net revenues increased by 14% and exceeded guidance. Second quarter gross margin grew by 19%, while net earnings substantially increased by 147%. Net earnings per diluted share grew by $0.06, making inTEST – marking inTEST’s 23rd consecutive quarter of profitability. Our Thermal Products segment is our largest, most profitable and diversified division and is providing inTEST with growth opportunities in the future. Through the strategic diversification of our Thermal Products segment, we are creating new opportunities in industrial testing and broadening of end market penetration. Our solutions are highly engineered and application-specific and often create or operate in extreme temperature environments. These thermal test systems are highly customizable and can be readily adapted not only to our traditional semiconductor market, but also to electronics test applications in various growth markets, including automotive, consumer electronics, defense, aerospace, energy, industrial, and telecommunications. Thermal segment bookings for the second quarter were $6.1 million compared with first quarter bookings of $6.4 million. Second quarter Thermal segment revenues were $6.7 million compared with first quarter Thermal segment revenues of $5.7 million. Revenue has trended up with non-semi improving. Semi declined in the quarter consistent with the industry. Semi is of course cyclical and variable with up-cycles balanced against down-cycles and forward-looking…

Thanks Bob. Second quarter 2015 end user net revenues were $10.8 million or 93% of net revenues compared to $9.4 million or 92% of net revenues in the first quarter. OEM net revenues were $839,000 or 7% of net revenues, up from $793,000 or 6% for the first quarter of 2015. Net revenues from markets outside of semiconductor tests were $3 million or 26% of net revenues compared with $1.8 million or 18% of net revenues in the first quarter. The company’s gross margin for the second quarter was $5.8 million or 51% as compared with $4.9 million or 48% in the first quarter. The improvement in the gross margin was the result of better absorption of our fixed manufacturing costs, which were unchanged at $1.5 million, but as a percentage of revenues, declined from 15% in Q1 to 13% in Q2. Also contributing to the improvement was a slight reduction in our consolidated component material costs which declined from 33.8% in the first quarter to 33.6% in the second quarter. While our consolidated component material costs remained stable sequentially, we saw both increases and decreases within our product segments. Our Thermal Products segment saw a small sequential increase in its component material costs, growing from 28.5% in Q1 to 29.2% in Q2, while the increase in our consolidated component material costs in our Electrical Products segment increased from 2.3% – increased 2.3% from 34.3% in Q1 to 36.6% in Q2. These were fully offset by a reduction of 2.9% and the costs of our Mechanical Products segment, which declined from 44.9% in Q1 to 42% in Q2. The changes in component material costs were driven by changes in both product and customer mix. Selling expense was $1.6 million for the second quarter compared to $1.5 million for the first…

[Operator Instructions] Your first question comes from the line of Srini Sundararajan with Summit Research.

Nice. Congratulations on a good quarter and thanks for taking my questions. I have one question and a quick follow-up. Can you make any comments on your China sales in the second quarter versus China sales in the first quarter?

Good question, Srini. This is Hugh. It’s funny. I don’t have geographic data in front of me here on the call. The one thing I can do is ask Jim Pelrin, if he can recall for the thermal group sales into China Q1 versus Q2. It’s not a normal metric, Srini, we have available on this call. So, I apologize that we may not have that available. Jim, would you have that readily with you?

Yes. I can answer qualitatively. We experienced an increase in sales in China. In this fourth quarter of last year, the first quarter of 2015, most of our telecom sales were to the Big Three as we call them. And now, we have developed sales and – bookings and sales into some of the smaller players.

Okay, great. And then I am not expecting guidance from you on the fourth quarter, but could you give me any qualitative highlights of the various segments in the fourth quarter?

Good question, Srini. Normally, our fourth quarter trails down seasonally from Q3, like Q1 they tend to be the trough quarters for us. I understand you got a model that you need to update at this point and that we don’t provide guidance for the fourth quarter, but I would expect our results in the fourth quarter at this point to be probably somewhat consistent with the first quarter of the year.

Okay, great. Thank you very much.

You are very welcome.

[Operator Instructions] There are no further questions at this time. I would now like to turn the call back over to Mr. Matthiessen for any closing remarks.

Thanks, operator and thank you for your interest in inTEST. We look forward to updating you on our progress when we report our third quarter results. Good evening.

Thank you for participating in today’s conference. You may now disconnect.