Welcome to the Methode Electronics Fiscal 2013 Fourth Quarter and Full Year Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. This conference call does contain certain forward-looking statements, which reflects management's expectations regarding future events and operating performances and speak only as of the date hereof. These forward-looking statements are subject to the Safe Harbor protection provided under the securities laws. Methode undertakes no duty to update any forward-looking statements to conform the statements to actual results or changes in Methode's expectation on a quarterly basis or otherwise. The forward-looking statements in this conference call involve a number of risks and uncertainties. The factors that could cause actual results to differ materially from our expectations are detailed in Methode's filings with the Securities and Exchange Commission, which is our annual and quarterly report. Such factors may include, without limitations, the following: dependence on a small number of large customers, including 2 large automotive customers; dependence on the automotive, appliance, computer and communications industries; customary risks related to conducting global operations; the ability to successfully launch a significant number of programs; ability to avoid, design or manufacturing defects; ability to compete effectively; dependence on the availability and price of raw materials; dependence on our supply chain; further downturns in the automotive industry or the bankruptcy of certain automotive customers; ability to keep pace with rapid technological changes; ability to protect our intellectual property; ability to withstand price pressure; location of a significant amount of cash outside of the U.S.; currency fluctuations; ability to successfully benefit from acquisitions and divestitures; ability to withstand business interruptions; income tax rate fluctuations; and the cost and implementation of SEC disclosure and reporting requirements regarding complex materials. It is now my pleasure to introduce your host, Don Duda, President and Chief Executive Officer for Methode Electronics.

Thank you, Christian, and good morning, everyone. Thank you for joining us today for our fiscal 2013 financial results conference call. I'm joined today by Doug Koman, Chief Financial Officer; Ron Tsoumas, Controller. Both Doug and I have comments, and afterwards, we will be pleased to take your questions. Methode's fourth quarter sales grew over 17% to $148 million, and for the year, grew nearly 12% to $520 million. In both periods, improved volumes driven mainly by increased sales of lead-frame assembly products and torque-sensing products for e-bikes, motorcycles and ATVs, as well as new product launches in our European Automotive business and higher appliance sales, along with the launch of new programs in our Power Products segment. These sales improvements were partially offset by softness in our European Industrial business, which is a higher-margin business for us. Methode's fourth quarter net income was $10.2 million or $0.27 per share compared to $5.8 million or $0.15 per share in the same period last year and was impacted by several items, which I will summarize from the press release. During the fourth quarter, we recorded a goodwill impairment charge of $4.3 million in our Power Products segment related to its assets. Doug will talk about this more in a few minutes. Additionally, during the quarter, we incurred compensation expense related to the tandem cash award component of our long-term incentive program of $2.1 million. The cash incentives awards that are based on the company's performance in fiscal 2015 will become payable if performance under the restricted stock awards issued in conjunction with the plan exceeds target performance. This $2.1 million adjustment reflects the company's estimates of fiscal 2015 performance. We'd also adjusted valuation allowance related to our Malta investment tax credit for a benefit of $7.6 million. Excluding the impact of…

Thank you, Don. Good morning, everyone. Let me add just a few additional comments on the Eetrex goodwill impairment, the compensation expense related to the tandem cash awards and the Malta valuation allowance. Regarding the Eetrex impairment, in the fourth quarter, we tested the goodwill for reporting units in our Interconnect and Power Products segments. All but Eetrex, which is in the Power Products segment passed the Step 1 test. We subjected Eetrex to a Step 2 test and determined that its goodwill was impaired based on management's updated projections of Eetrex's discounted cash flows. We still believe this is a viable business, but because of the pushout in cash flows, the accounting rules require us to write off the the goodwill. The charge was $4.3 million. Moving to the tandem cash awards. In the fourth quarter, we recorded a $2.1 million expense for amounts expected to be paid under our 2010 long-term incentive plan for tandem cash awards. This expense represents the prorated catch-up expense from October 2010, which is the grant date, to the end of fiscal 2013, and is valued at the fiscal year end closing share price of $14.05. Performance under the tandem cash award is determined by fiscal 2015 enterprise value, which is fiscal 2015 EBITDA times 7.5 plus or minus net cash. The amount accrued is based on management's updated projections of future earnings and the net cash balances and assumes that the company will achieve the maximum level of performance under these awards. This would result in an enterprise value as defined in the plan, equal to or greater than $726.5 million at the end of fiscal 2015. On the tax benefit in the quarter, Maltese tax laws provide for investment tax credit on certain qualified capital spending. We are required to set…

Doug, thank you very much. Christian, we are ready to take questions.

[Operator Instructions] Our first question comes from the line of Steve Dyer with Craig-Hallum.

Just a couple of different things here. What drove the upside in the quarter kind of relative to your guidance in Q3, which was part of the way through Q4 then you ended up, obviously, quite a bit better? Was that kind of the laundry business kicking in sooner than possible or sooner than expected? Or was that sort of a bunch of different things? Or any more color there?

So it's -- our lead-frame products in Asia came in higher than we anticipated. Our MFT products, as a torque-sensing product, are a little harder to predict that going on e-bikes and ATVs, and that's -- we have probably less visibility to that. Product launches in Europe, while they were -- the volumes were down, they weren't down as far as we had anticipated. Appliance came in slightly better. And then Power Products, that's, again, harder to forecast, but the datacom customer took more products than we had anticipated. And we were, of course, able to ship that to them. And that impacted the Power Products, so -- And certainly, a little bit of -- really, across the board, the only downside was electronic and that we understand is just something that was from the industrial market in Europe. But, really, we did see nice upside from most of the areas in Methode.

Okay. And, I guess, as long as we're -- we touched on Europe. What's your general sense of things over there? Have we found the bottom? Are we -- what's just generally kind of your thoughts there?

I guess, that's why you see the range that we gave. It is very difficult to get a handle on what's going on in Europe. The Automotive part -- I mean, I read one report last week that said things were stabilizing. And then I read another one that the volumes and the new registrations were going to be down. So it's really hard to peg that. And that's why I made the comment in our prepared remarks that on the low end of our range, we could see the further impact in Europe. And then the -- it's almost like the U.S. consumer confidence. And in Europe, that's, I think, having a big effect on the car-buying public. So I apologize, I can't give you a better answer than that, but...

No, that's helpful. So well into your range would incorporate some further deterioration in Europe?

That's correct. That's fair.

Okay. Just to clear something up on the lead-frame award that you announced? Is -- that $75 million, is that annually, or is that over the life of the program?

That would be over 3 years. I'm going from memory. I want to say $16 million, it adds about $25 million and maybe high change, about the same for -- excuse me, I said $16 million, it should add $25 million and change, $17 million and $18 million, about the same. A little lower than $18 million, I think.

And is that incremental?

Actually, Steve, I'm being corrected, it's $28 million. And each of those, 3 years, and a little less in the final year.

Okay. And is that incremental to the $40 million in lead-frame award that you have right now? That's all new?

Yes, that would take -- it's incremental, and it supports our ramp in '16 and beyond.

Okay. Is that what's one of the existing customers or new customer? Anything you can share about the customer?

It is -- was an existing customer. It's a -- customer put it out for a competitive bid, and at one point, looking to have a second vendor, and we were successful in winning that award. It is the 276 lead frame for the GM 6-speed transmission.

Got you. Okay, 2 more quick questions. Any GM revenues in this quarter -- fiscal fourth quarter from the center console program?

Up -- just a little under $3 million, I believe, not significant.

Okay. And then when might we see the first win for the torque sensors in the -- in light vehicles? Is that a fiscal '14 event, fiscal '15 event?

I would say it's a '15 event. We're still in the prototyping stages -- I mean, in serious prototyping. The customers are paying for the prototypes. It's not -- and they have active programs, but we're -- I think we have another 9 to 12 months to go before we get a handle on that, and that'll-- early on, it might affect '17. I think that's probably -- the '17 or '18 fiscal year would be affected by that.

Our next question comes from the line of Jimmy Baker with B. Riley & Company.

Just a couple follow-ups here on some of the new business traction. Really interested to hear you give maybe a little bit more color when you talk about opportunities for your capacitive touchscreen and additional automotive programs, I think, you said in fiscal year '15. So if you could just kind of help us quantify that opportunity. And then maybe also set expectations for the margin profile of that product versus, let's say, your lead-frame or more integrated center stack solutions?

Okay. It's difficult to give more color on the deployment of the capacitive screen, because we really can't say anything until our customer has announced their intentions, much like when we announce the GM initial award, we couldn't even say it was for pickup trucks. So I don't know that I can give you any more color on what platforms that will be deploying on. I apologize, but I do have to respect our customers' wishes there. As far as margin on the touchscreens, that's going to vary by program. But I can tell you that in our margin goals for automotive for '15, we've incorporated some of the capacitive screen being sold to our customers, so that will support our margin improvement there. And then, depending on where the next wins come from the screen, it'll exhibit probably slightly higher automotive margins and what we have in our target ranges. And it kind of depends on customers. It depends on if it's going to be solely -- if we were just selling the capacitive screen on its own, or is that being wrapped around a center console. I don't know if there's any more -- how are you to answer that. Is there anything [indiscernible]?

Well, in respect to your customers' confidentiality, can you maybe point to what geography that award will be in?

I think we've said the capacitive screens are going to be deployed in the United States first, so that and we certainly can say that. I can't give you more color on that, but we do have MBAs with our customers that I have -- we need to respect.

Sure, understood. And then just a question on the guide. I think your recent conference appearances, you've been targeting 7% to 9% operating margins here in fiscal year 2014. And by my math, your guidance implies maybe just a slightly lower rate than that closer to 7% -- or excuse me 6% to 8%. Is the delta there just that your formal guidance is a bit more conservative than what you're targeting? Or has there been some impairment to your profitability expectations here in '14?

No. I would say perhaps the latter. But what you're going to see, as I said, in our remarks is that our operating margins should steadily improve, sequentially, each quarter. And that as we've reached the fourth quarter, we'll reach the higher end of that range. So if anything, it's just the ramp that's affecting that. But as I said, you're going to see, assuming the volumes are where we think they'll be, you're going to see a steady ramp quarter-over-quarter throughout this year. So there's nothing that would change us -- would give -- actually, would give us any concern other than the first advice materializing.

Great. And then last question for me. Just interested to hear more general color about any traction you're seeing in integrated center stock bidding. Now that you have the K2XX win under your belt and are out shipping that product. And, I guess, separately -- or on the other hand, if there's been any damage from, let's say, the more mixed press that the MyFord Touch system has had more recently.

Let me answer the last question first. As I said, the programs we have now are all conventional. The only program that we had using touch was the Ford program. And, you're right, it is mixed press. Ford is selling a lot of vehicles. And on any given website or articles, you get mixed views on that. And we've said that, that's -- we weren't counting on -- in going forward if that was going to be replace conventional knobs and dials in the vehicle. We never planned on that. So if anything, it -- our notoriety, if that's the correct word, with Ford has kind of put us on the roadmap as a premier center console supplier, whether that be with Touch or conventional buttons. And the K2 is, I think, proof of that strategy working. As far as more traction in new programs, we are, obviously, pursuing the programs that are available with automakers. And I'm not doing a good job answering your questions here, but I really can't talk about the programs until we booked them. And again, that's usually in these quarterly calls. But rest assured, we're mixing it up with the appropriate automakers that have the programs and the volumes that match our capabilities.

[Operator Instructions] Our next question comes from the line of David Leiker with Robert W. Baird. Joseph D. Vruwink - Robert W. Baird & Co. Incorporated, Research Division: This is Joe on the line for David. Don, just a quick question, on the last earnings call, you talked about having $20 million worth of center console product loaded into the production system. Your commentary in this call about the 50,000 units. I don't think that gets you quite to the $20 million mark. So I'm just wondering, 2 months in, looking into the July month, do you think you'll be closer to the $20 million kind of revenue mark as we close out the quarter?

Well, the 50,000 was simply -- this is what's been produced. And I think I did say in our remarks that we're on track for our, I think, $139 million. So we're -- I guess, all I can say Joe is we're on track. There's nothing that would in our production system, on our releases, that would give us any pause that we're going to have a steady ramp here throughout the summer months. Joseph D. Vruwink - Robert W. Baird & Co. Incorporated, Research Division: Okay. I guess 50,000 units probably brackets the $5 million to $10 million revenue mark, I'm guessing. And so I was just trying to reconcile that against the $20 million count as from last quarter.

So right now, we're shipping to 1 of 3 plants. And then, I can't say when the other 2 plants come online here, but, Joe, I just issued guidance. I'm not sure, how much more color to give you there. Let me tell you this, we have sufficient releases loaded into our production system that would support the guidance we just gave. Joseph D. Vruwink - Robert W. Baird & Co. Incorporated, Research Division: Okay. Switching gears on the capacitive touch screen business. I've always thought that when you look at that product, the piece of glass is kind of a higher-cost element, which presumably you're going to be sourcing in, so the fact that the overall product is going to be realizing a higher margin, is that a function of the touch points you underlay with the glass or just a function of the overall pricing of the total product when you incorporate the touchscreen?

Our margins, the way we've designed the capacitive screen, which is somewhat novel from the conventional way of doing that does give us an advantage. And right now, we're buying the screen, so we get the growth and the vertical integration, which supports the improved margins. It's a combination of both, the way we make it and that we're not procuring the product -- from the outside, other than this way itself. Joseph D. Vruwink - Robert W. Baird & Co. Incorporated, Research Division: Okay. And then switching to the Power Products business. Just wondering, the really strong growth in the quarter, particularly, in Europe, is that pretty much all the Nissan lease product launching?

No. The lease was a portion of it, but we saw a very strong shipment to our datacom customer here in the United States, and we were very pleased to see that. That's been a program that we've been working on for quite some time. And its impact to our margins shows that our strategy of supplying a subsystem versus the street components is starting to get traction and empowers us well. That's really the first major program we've launched, where we're -- we have a bus bar, a PowerRail, our high-current Interconnect, our cabling, all wrapped up into one -- several variations of the product, but one side of the product. So that -- Nissan lease was, of course, a nice win and instrumental in the quarter, but I would point more to the datacom business than anything else. Joseph D. Vruwink - Robert W. Baird & Co. Incorporated, Research Division: Okay. And then last one for me. Just with goodwill write-off, and how you think about Eetrex? I understand the calculation and how pushing out the cash flows can result in the impairment, but just wondering, given the changing expectations for electrified vehicles we've seen over the last couple of years, is your optimism or bullishness with Eetrex and that product category as strong as it was maybe 12 or 18 months ago?

Well, what we did, really, maybe over a year ago is to refocus them on stationary storage for data centers where we know there's a demand and the need for the lithium ion in the battery backup systems. And we focus them away from EVs. And are originally, they were providing onboard chargers for the e-vans. And that's what was providing the cash flow projections. We were -- at one point, we were anticipating, I think, 300 to 400 units would be shipped. And I think in the end, it was 60 to maybe 70 units. And so quite some time ago, we switched their engineering effort over to stationary storage, where we've got a very clear path to market directly to the data centers, where in the EVs you're going with the OEs, your at best of Tier 1. So it's, really -- we made that switch some time ago, but then when we project the cash flows out, we have to do the analysis. And that's what caused the write-off.

There are no further questions at this time. I'd like to turn the floor back over to you for any closing comments you may have.

Christian, thank you very much. And we will end the call and wish everyone a pleasant day. Thank you.

Ladies and gentlemen, this does conclude today's conference. You may disconnect your lines at this time, and we thank you all for your participation. Good day.