Earnings Labs

Nortech Systems Incorporated (NSYS)

Q3 2014 Earnings Call· Mon, Nov 10, 2014

$13.80

-3.16%

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Transcript

Operator

Operator

Greetings and welcome to the Nortech’s Third Quarter 2014 Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded. I’d now like to turn the conference over to your host, Paula Graff. Thank you. Please go-ahead.

Paula M. Graff

Analyst

Thank you. Good morning and welcome to Nortech Systems third quarter fiscal 2014 conference call. I’m Paula Graff, Vice President and CFO; and with me is Rich Wasielewski, Nortech’s President and CEO. Following my introduction, Rich will offer comments on our third quarter results and developments in the market we serve. Then we’ll open up the call for your questions. Before we begin, please be advised that statements made during this call may be forward-looking and are subject to risk factors and uncertainties. Please see the complete Safe Harbor statements in our press release and SEC filings. Our 10-Q for the third quarter was released yesterday along with our press release. Now, I will turn the call over to Rich Wasielewski. Rich?

Richard G. Wasielewski

Analyst

Thank you, Paula, and good morning everyone. Thanks for joining our call. Our third quarter results continued the positive momentum that’s been growing during the year. After the slow start in Q1 from the cold weather and the impact of the economy on our customers, we’ve seen continued improvement in our results in both Q2 and now here in Q3. Our quarterly sales of $28 million rose 2% over prior year and 2% sequentially from the second quarter. But even a slight growth increase coupled with a good profitable mix is good news. Our total backlog levels are rising for the third straight quarter. Total backlog 90-days increased 9% from the prior quarter and were up a 11% from the third quarter of 2013 and were up 30% from the start of the year. Looking at the major markets we serve, we are seeing strong top line gains out of our medical customers. Sales for the quarter increased 19% from the prior year to $10,800,000. Nine months revenue was $30.8 million, up 24% from the prior year. During the recent third quarter, our medical backlog rose 17% sequentially and year-over-year our third quarter medical backlog increased an impressive 81%. The majority of the increases are coming from our medical systems, cables, assemblies. They go on larger medical machines cables such as power cables, track cables and coil cables. But we are also seeing good activity in backlog and pipeline in our medical device customers. Increased focus on design engineering is leading the way. As we mentioned in our second quarter call, we are working to engage our customers earlier in the new product development. During the past recession, many medical OEMs laid-off a larger number of their design and engineering staff. Now these firms are looking to us to offer…

Operator

Operator

(Operator Instructions) And it seems that we have no questions at this time. I’d like to turn the floor back to management for any additional remarks.

Richard G. Wasielewski

Analyst

Well, if there are no questions, we’ll conclude this call. Thank you for your interest in Nortech Systems and we look forward to updating you in the future. We’ll do our best to keep our momentum going. Have a great day. Thank you.