Please standby, we are about to begin. Good day, everyone. And welcome to the Universal Display Corporation First Quarter 2012 Earnings Conference Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Mr. Joe Hassett from Investor Relations. Please go ahead, sir.

Thank you, and good afternoon, everyone. With us today are Steve Abramson, President and Chief Executive Officer; and Sid Rosenblatt, Executive Vice President and Chief Financial Officer of Universal Display Corporation. Let me begin today by reminding you that this call is the property of Universal Display. Any redistribution, retransmission or rebroadcast of this call in any form without the expressed written consent of Universal Display is strictly prohibited. Further, this call is being webcast live and will be made available for a period of time on Universal Display’s website, this call contains time-sensitive information that is accurate only as of the date of the live webcast of this call, May 9, 2012. All statements in this conference that are not historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include, but are not limited to, statements regarding Universal Display’s beliefs, expectations, hopes or intentions regarding the future. It is important to note that these statements are subject to risks and uncertainties that could cause Universal Display’s actual results to differ from those projected. These risks and uncertainties are discussed in the company’s periodic reports filed with the SEC. Universal Display disclaims any obligation to update any of these statements. Now, I’d like to turn the call over to Steve Abramson, President and CEO of Universal Display. Steve?

Thank you, Joe. And welcome everyone listening today. It seems like there’s been a news article or product announcement in the OLED industry almost everyday. Most recent is Samsung announcement last week of the new Galaxy S3 smartphone featuring an amazing 4.8-inch AMOLED screen with 1280x720 pixel resolution. The OLED market continued to grow and we continue to grow with this exciting new market. Results in the quarter continue to reflect the growing demand for our proprietary materials and technology. Our material sales more than double from a year ago consistent with industry growth. Sidney will describe the overall results in greater detail. As we discuss our results, please remember that our first quarter results do not include any of the license fees we are schedule to receive this year under our new Samsung license agreement. As Sid will explain, we are scheduled to be paid and we’ll recognize the SMD license fees in the second and fourth quarter. The use of our materials and technology in both the display and lighting markets around are accelerating. This is a natural progression of the many OLED seeds that have been planted in a wide variety of markets over the past decade that are now either taking firm root or have already blossomed. According to report published by oled-info.com, DisplaySearch expects the global OLED market to grow to 242 million units in 2012, up 128% compared to 2011. Revenue will reach $5.93 billion this year, up 102% from last year. DisplaySearch see sales of OLED smartphone display rising from 81.3 million units in 2010 to 176.5 million in 2012, and 261 million in 2013, according to their research Samsung has a 97% share of the OLED market and since the market is projected to double again this year, Samsung continues to expand…

Thank you, Steve, and again thank you everyone for joining our call today. Revenues for the first quarter of 2012 were $12.6 million, up 31% compared to first quarter 2011 revenues of $9.6 million. Results in the first quarter do not include the recognition of any license revenue under a license agreement with Samsung Mobile Display under with Samsung is obligated to make payments to the company of $15 million in each of the second and fourth quarters of this year. Accordingly, had the company recognized these payments on a pro rata quarterly basis over the year, it would have resulted in an additional $7.5 million in royalty and license fees in the first quarter. The company will incur a license fee of 3% payable to its University Partners and 16.5% with holding tax, payable to South Korea in connection with the SMD license revenue. In the first quarter of 2012, revenues from material sales were up more than 130% to $10.6 million, compared to $4.5 million for the first quarter of 2011. The increase is in line with a growth of the OLED industry. Material sales include the sale of red, green, yellow and light blue phosphorescent emitters, as well as green and yellow host material. The number of customers purchasing OLED materials in the first quarter increased by approximately 50% from the first quarter of 2011. Sales of emitter materials comprised 81% of total material sales for the three months ended March 31, 2012, compared to 94% for the three months ended March 31, 2011. Red phosphorescent emitter sales to our largest customer under a commercial agreement increased by over 150% in the quarter ended March 31, 2012, compared to March 31, 2011. Green phosphorescent emitters and green host material sales slowed in the quarter ending March 31st,…

Thank you, sir. (Operator Instructions) We will take your first question from Jim Ricchiuti with Needham & Company. Jim Ricchiuti – Needham & Company: Hi. Good afternoon. I wonder, if could talk a little bit more about the slower phosphorescent and host materials revenue that you saw, the green in particular just versus the second half. Can you elaborate on that? You talked about in terms of it being temporary. Was it an inventory issue do you think, Sid?

Well, the second half of the year and the third quarter was higher than our expectations. It does take time to get technology adopted into a new line and new products, and we still think that second half of this year is going to be where this technology goes and it just sort of -- it is part of new technology being introduced. Jim Ricchiuti – Needham & Company: Got it. Okay. And then you also showed very strong growth year-over-year in red and in -- I was wondering, can you say whether Samsung met or exceeded their minimum in terms of materials revenue in the quarter?

The minimum that Samsung has are an annual dollar amount.

We’ll take our next question from Andrew Abrams from Avian Securities. Andrew Abrams – Avian Securities: Hi, guys. Just a quick question on the license fee. Just overall an agreement here it’s $15 twice a year and the withholding is only going to show in the second and fourth quarters also?

That is correct, when we get the payments. Andrew Abrams – Avian Securities: Right. So we will see no withholding this quarter regardless.

That’s correct. Andrew Abrams – Avian Securities: Got you. And the additional license fee that you're going to get from other customers is going to be continued to show as individual quarters, there is no change in any of that. Is that correct?

That is also correct, Andy. Andrew Abrams – Avian Securities: Okay. And in terms of how you look at the host material business, obviously Samsung is ramping up capacity relatively quickly. Would you expect that to be a determining factor in how the host business goes that they might adopt that in the new facility as opposed to on individual lines that they are running currently?

We believe that they will, but we really can’t answer questions for Samsung. We expect our green host and our green emitter materials both to grow in the second half of this year. And as they add capacity, we expect to be part of that capacity add.

(Operator Instructions) We’ll move next to Carter Shoop with Keybanc. Carter Shoop – Keybanc: Hi. Thanks for the increased commentary there on the red, green and emitter, and host. I appreciate that. First question has to do with a follow-up on the green emitter and host business in the second half of the year. Obviously, it sounds like you guys are expecting that business. What’s your level of confidence that that will actually ramp here? We are at a point now where it’s a foregoing conclusion, or is there still several variables at play that are out of your control that could impact the sales to SMD in the second half of the year for the green set?

There are clearly variables that are out of our control. I mean, we are not the manufacturers. We do work closely with them and as we said, we do expect them to grow in the second half of this year. But there are things that are in Samsung’s hand not in ours. Carter Shoop – Keybanc: Okay. And then in regards to your level of confidence that that will proceed as planned, is that something that you feel very comfortable with or is there something that you are kind of thinking it’s a 50-50 shot? And then my follow-up question is, when you think about your full year guidance, which you guys are reaffirming for the second time now. Can you maybe discuss some of the items that have gone better than what you expected, when you originally provided that guidance and some of the disappointments?

I mean, we looked at the full year in terms of our guidance and because there are -- there's really not a whole bunch that is different for the first few months of this year, first four month of this year then what we expected in our guidance. It really as Steve said, a TV adoption, accelerating could obviously help us in the second half of this year. But right now, what we’re looking at is the full year and we are still comfortable with $90 million to $110 million. And to your other question, in terms of percentages on the second half of the year with green, I mean, we are comfortable that it will be in -- we will see increased sales. I can’t give you a percentage. It is really out of our hands in terms of how quickly and how many different lines it gets adopted and that’s really our customers business.

(Operator Instructions) John Bright from Avondale Partners has your next question. John Bright – Avondale Partners: Thank you. Good afternoon, Steve, Sid. I’m going to follow the same line of questionings. Questioning one, why was green slower versus red, and if you annualized the materials sales relating to Samsung from the first quarter, would those have -- would you meet -- would you be at minimum, below, above?

Well, John, it takes a while to adopt the materials into the product lines and we work as hard as we can, but we don’t control the actual adoption and sometimes these things just will take sometime before they get adopted. So we look at it on a long-term basis.

In terms of annualizing, I mean it is still early, we’ve only announced one quarter and as we have said, we expect green material sales to grow in the second half of this year with them. So for us to predict whether or not they met their annual minimum is really difficult for us to do at this time. John Bright – Avondale Partners: Okay. My second question is what is your thought on providing profitability guidance? Or your hesitation in not providing it for your annual guidance, as a part of that, what percentage of your revenue guidance is demand driven versus contractual and do you have TVs included in that guidance?

The answer to your first question, we really because of the early stage of the industry, we are just getting comfortable with annual guidance. And as you can tell from a lot of other questions, it is still difficult for us to pin down specifics. And for us to then start giving earnings or EPS guidance, it’s going to be in the same range. And we do say that we expect expenses to grow at 10% to 15% range. So to be honest, you guys could calculate it just as well as we can based upon those. We don’t expect expenses to grow significantly. And in terms of the components of our guidance, we really did this customer by customer. And we built it up from the bottom based upon what our expectations are from those customers and based upon what the customers have told us and based upon historical knowledge that we have of when things occur, when they don’t occur. And we’re very comfortable with the guidance based upon that. We really have not discussed specific components of it and because of the stage of the development of the industry, we really can’t do that at this time.

We’ll move onto Brian Lee from Goldman Sachs. Brian Lee – Goldman Sachs: Hi guys. Thanks for taking the question. I had a couple. I’m also trying to understand what drove sequential downtick in materials. We then we’ve developed national customers that reduce volumes on green emitters specifically or was it off Samsung? And when you say you’re expecting recovery, that’s affected Q4 2011 levels or are we thinking above that and then I have a follow-up?

In this quarter, we sold significantly more commercial materials. As we said, the commercial materials of Samsung went up significantly. And as we also talk about green emitter materials were down in this quarter. So that’s really where the differences are. Brian Lee – Goldman Sachs: And then the question on recovery?

I’m sorry, repeat that. Brian Lee – Goldman Sachs: You mentioned, you are expecting your recovery on green materials in the back half of the year. Are we thinking this past year, where you guys were at the end of last year or are we materially above that? And then I do have a follow-up?

It’s difficult for us to answer that question because it is still an unknown as to the timing of when it will grow. We do expect it to grow. As we said in the quarter, the quarter is very difficult for us to try to predict. We’re all looking for widespread adoption of green. Brian Lee – Goldman Sachs: Okay. Fair enough. Quick question on the guidance and then I’ll let you guys go. It’s still on that if I take the Samsung license revenue for 2012, $30 million that’s already been given. We assume there are material purchases double year-over-year in line with their growth, which seems like we were on that trajectory in Q1. And then we take the last piece of non-Samsung revenue from last year which was again around $30 million in the growth. That alone takes you to about $90 million in your guidance. So I guess, just a couple of questions just on that. First does that math makes sense and if so, in what scenario could sales outside of Samsung be flat in your view -- and I guess, what I’m trying to ask is why the revenue outlook doesn’t inch up at least slow when you look at it from that perspective?

I think your math make some sense. I really haven’t -- pulling it apart. There are some parts of our revenue stream such as government contracts and technology development, which is flat and will continue to be flat as we’ve said, so $10 million of last year’s revenue as revenue that we expect to be $10 million this year. We do expect other customers to buy more materials and other things to grow. I don’t disagree with your math. It is still too early for us to predict. As Steve said in his remarks, there is quite a bit of activity from other customers. We expect them to grow. However, historically we know that things either occur faster or slower than we have anticipated. And our guidance when we put it together and when we looked at it, still we are comfortable with 90 to 110 at this time.

We’ll move on to Srini Sundar from Oppenheimer. Srini Sundar – Oppenheimer: Hi, guys. I have a one question and one follow-up. My first question is how easy it is to go from a LCD plant to an OLED plant or OLED fab. The reason I am asking this is you could potentially look at the CapEx levels of Samsung and again some conclusions as to what might be possible in a limited timeframe?

Well, at this point, people are generally looking to green field, a lot of the OLED fabs. And that’s dependent on the TFT backplane issue because the OLED piece of it is -- some of it is the same as the LCDs, the OLED piece itself is little bit different. The question really is going to be with the possible new generation of TFT such as Oxide TFTs, would you be able to retrofit an existing LCD fab that uses amorphous silicon and compared to an Oxide TFT flat fab that would be acceptable to OLED and that’s something a lot of people are looking at right now. Srini Sundar – Oppenheimer: Okay. And my follow-up is, what are you currently doing in China specifically?

We are studying that market.

We currently have no customers in China.

Moving on to, Rob Stone from Cowen & Company. Rob Stone – Cowen & Company: Hi, guys.

Hey, Rob. Rob Stone – Cowen & Company: I wanted to ask about license revenue from customers other than Samsung. I think it was, if I’ve got the figures correct, higher in the third quarter last year and then declined. It’s running sort of less than $0.5 million now. How many customers can you say we’re paying licensees in Q1?

Our license revenue includes amortization of upfront fees over the life of the license. And secondly, it includes part of the material sales for customers that we have material license agreements where we build a license fee into the material itself. So there are a number of components to that. And if the material sales were to a customer who were down in this quarter, then the variable portion of that would change. The fixed portion of it pretty much is fixed in each quarter. Rob Stone – Cowen & Company: So are you able to say how many customers are actively paying licenses other than Samsung?

No. We don’t disclose which customers are… Rob Stone – Cowen & Company: No. I’m not asking you which customers, just the number?

I can get back to you, Rob. I don’t have that information right in front of me. Rob Stone – Cowen & Company: Okay. Sure. Fair enough.

There are a number of different customers and there are license fees that we have signed with number of customers that we are amortizing over the life of the licenses. We’ve got a number of lighting customers that we signed license agreements with, that has an upfront component which we amortize over the life of the license fee. Rob Stone – Cowen & Company: Is the license attached to material sales typically the form that it takes before somebody goes into a long-term commercial deal?

Yeah. That is -- normally, the way we start out is by building a license fee into the material. We sign a material supply agreement and then we’ll continue that for some period of time. And then eventually, we’ll sign a royalty bearing for license agreement that has material pricing that is different because they are either paying your license fee or a royalty.

We’ll move next to Hendi Susanto with Gabelli. Hendi Susanto – Gabelli: Hi Sid. Hi Steve. Thank you for taking my questions. First, in the past, you indicated that adoption of green emitter materials into the production line may take months. How many customers have adopted and how many are adopting green colors into production line at this point?

Well, it’s being evaluated widespread by most of our customers. Hendi Susanto – Gabelli: And could you share like how many have put green materials in their production line at this point?

I mean, the only one that we know that had in commercial products which is the largest supplier is Samsung because they’re really the only one that had any commercial products in the market. Hendi Susanto – Gabelli: Okay. And then my follow-up, considering the launch of Galaxy SIII Smartphone and LG’s plan to launch OLED TV in May. Is it fair to think that directionally we should see sequential growth of material sales in the second quarter of 2012?

It’s hard for us to predict but if the volume grows and the number of products continue to grow, we would expect to grow with the market.

Jon Dorsheimer from Canaccord has your next question. Jon Dorsheimer – Canaccord: Hey guys. Thanks for taking my question. Just curious, if on the Samsung, you should read into, sort of, this level is, kind of, the way you wanted to look at the rest of the industry. Any comments on that in terms of discussions are known. Be specific in terms of your discussions with other customers but is this the type of yield that you would like to see from the rest of the industry? Thanks.

Yeah. I think, Samsung is unique. Jon Dorsheimer – Canaccord: Okay. Is it -- do you view -- I mean, how would you view the conversations, may be, if you could elaborate because I think investors really wanted to try and get a grasp or understand how the rest of the industry will adopt in terms of your positioning and license versus royalty. It will be helpful here. Thanks.

Sure, Jon. Our Samsung is unique because they are the largest player and they really enabled this market. The rest of our commercial agreements with the number of other companies are all royalty based and we sell them materials and at the same time -- at the same types of agreements that we’re looking forward to with the rest of the industry. Jon Dorsheimer – Canaccord: Do you see that your additional agreement higher or lower than the Samsung?

That we really can’t talk about. Jon Dorsheimer – Canaccord: Okay.

We’ll move next to Jagadish Iyer from Piper Jaffray. Jagadish Iyer – Piper Jaffray: Yeah. Thanks for taking my question. Two question, Sid. First question, there is a recent presentation by Dow Chemicals in terms of number of materials both on the phosphorus and on fluorescent side that they are offering. I was wondering do you have any relationship with Dow Chemicals? Then I have a follow-up.

No. We do not have relationship with Dow Chemical. Jagadish Iyer – Piper Jaffray: Okay. Second thing, I was wondering as Steve called out the number of Smartphones increasing from quarter-over-quarter from December to first quarter. I was wondering, can you breakout how much OLED phones grew from fourth quarter to the first quarter?

We don’t have these numbers handy, but let us get to know, I’ll get back to you.

We’ll now take a follow-up from Jim Ricchiuti with Needham & Company. Jim Ricchiuti – Needham & Company: Yeah. Just wanted to look at some of the operating expense items, so how would you see your R&D expense going forward either in absolute dollars or as a percent of revenues for this year?

Well, in absolute dollars, we do expect to see probably over the year 10% to 15% growth, which we saw from last year to this year. I mean, we do have some folks that we are going to hire and we are going to expand some of our efforts. I don’t see it tracking a percentage of revenue. I expect in absolute dollars the number to grow by the end of the year by -- as I said maybe 10% to 15%. Jim Ricchiuti – Needham & Company: Okay. And I realized there is a lot of sensitivity with some other customers -- potential customers you speaking with. But I am wondering if you could characterize the discussions with some of the other players outside of your main customer. Given the sensitivity, I mean, where do you see what kind of -- if you look at what’s happening in Taiwan and elsewhere with LG in Korea. Do you get the sense you are going to have a commercial agreement in place with other parties potentially by the second half of this year just given the fact that they are scaling up.

We clearly are working with all of them. And we would like to get long-term relationships in place. Can we say for sure we’ll have them place by the end of this year. I don’t think I could say that but I think it is our goal to get some of them in place by the end of this year.

We certainly -- we will expect that commercial relationships with people before they launched commercial products. In the length of time in the other term are items that we are discussing. We have long-term relationships with all these customers. Both on technical and business side, we expect to continue to be doing that as the industry grows. Jim Ricchiuti – Needham & Company: Okay. Thank you.

We’ll go to another follow-up from Rob Stone from Cowen and Company. Rob Stone – Cowen and Company: Hi, Sid. Just a point of clarification on the way you characterized expenses. I think in the press release the commentary refer to total operating expenses, which actually includes cost to good sold not usually follow-up as an OpEx category, when mostly talking about that. So when you say 10% to 15% growth, are you talking about R&D, SG&A patent cost, royalties that’s stuff it’s below the gross profit line or you also including gross in cost to sales?

I am not including cost to sales. I’m talking about specific line items, the way our financial statements are reported. So that it would be on the R&D, G&A patent costs. Those are the ones I would have. The cost of sales number is a percentage of the sales of our commercially manufactured product. Rob Stone – Cowen and Company: Okay. And can you comment with respect to patent-related expenses, what the trend is -- has been lately? Are you investing significantly more on in filing patents, defending patents, how should we think about that piece of expense growth this year?

We do expect it to grow some this year. There are -- obviously there is some patent opposition matters and those costs tend to be lumpy as you either have a filing that is due or there is a hearing that is coming up. So those costs on the defense side tend to be a little lumpy on the patent just to know, a patenting cost we are filing more patent. So that we’ll grow. We are at 1400 patents compared to I guess about 1100 this time last year. So you will see growth in the costs of filing and the cost of maintaining patents. But I think we talked about early -- maybe at the end of the last year that we expect the number for this year to be probably around $10 million.

Carter Shoop from Keybanc has your next follow-up. Carter Shoop – Keybanc: Great. Thanks. And I apologize if this question is already asked. I got disconnected for a second. When you have your guidance of 90 to 110, its sounds like the TV launches happening this summer might to be little bit faster than what you’re originally expecting. I also have in my notes that green host wasn’t included in your 2012 guidance. That said, if we do see the green host return, if we do see TVs sell reasonably well, say inline with what display source is forecasting. Would we expect to see upside through that guidance or have there been a few items that have maybe pulled down from the upside potentials, since you guys initiated guidance?

Well, I think it’s some of these things that are faster than we would have anticipated. There is probably upside, but specifics based upon per customer, as I said, well we put our guidance together we based it upon what customers gave us as specific amount. So they expect to buy over the period whether two months, six months or nine months of guidance. So if the customers had that built into the expectations that they provided to us that has built in. We don’t get specifics from customers that are going into a TV or going into different products, what we get is material purchases and material requirements. But if the industry grows faster than we would have anticipated, we should see some -- we should participate in that growth. Carter Shoop – Keybanc: Okay. And see upside through that guidance. Okay. And then second follow-up, is there any reason to believe that it will be a lag between commercial OLED shipments from any of your potentially larger customers? And when you will recognize chemicals and royalty revenue from them, excluding SMD so taking LG, AUO, Chi Mei, those customers ramp. Is there any reason that there will be any kind of lag or would you anticipate to see the revenues hit before they actually commercially shipped those products?

So with older customers that are -- that have material supply arrangement, we record the revenue when we shipped the material. So if it is on the material supply agreement whether the licensee built in, it will then be recorded when they buy the material. If and when we signed royalty during license agreements, the royalty payments, timing of those maybe off depending on when we get reported. But that’s something that we have not done as of yet with those customers. With Samsung, the earlier license agreement that we’ve had where we got royalties we had a one quarter lag on reporting royalties because they didn’t provide us with royalty report until 60 days after the quarter ended.

Jagadish Iyer from Piper Jaffray has -- is in the queue for a follow-up as well. Jagadish Iyer – Piper Jaffray: Yeah. One quick question, Sid. Just to clarify, you’ve called out in your prepared remarks about blue phosphorous and material. Can you just elaborate on that because I think this is the first time that you are mentioning, can you elaborate on that please? Was that the same customer that you are shipped or was it a -- was it a new qualification? Any color that will be great. Thank you.

We’ve been shipping light blue phosphorous materials to a number of lighting customers, and that continues to be the case. We still do not yet have a deep blue phosphorous molecule for working very hard on commercializing that.

Andrew Abrams from Avian Securities, your line is open. Andrew Abrams – Avian Securities: Thank you. Just one quick follow-up on the material side. I know you don’t classify developmental and commercial anymore, but could you classify developmental and commercial in terms of your material side?

Andy, we don’t do that any longer mainly because the way that we record our cost of sales is based upon material that we have commercially produced. So we don’t really track in that regard, because we do record the materials based upon our production and whether these are commercially produced materials. I don’t have specifics for you, but I do believe that the significant portion of this year’s revenue -- this quarter’s revenue was on the commercial side as opposed to the developmental side, but we don’t break it down that way anymore. Andrew Abrams – Avian Securities: And just if you don’t break it out specifically, yellow, was yellow developmental, it sounds like yellow was developmental or was yellow on the commercial side?

Yellow, I believe was on the developmental side. Andrew Abrams – Avian Securities: Got it. Thanks very much.

And gentlemen, your final question tonight will come from Hendi Susanto from Gabelli. Hendi Susanto – Gabelli: Hi. One follow-up question. If I look at the host material sales historically, you had exceptionally strong green host materials in Q3 2011 with $7.1 million which looked very higher than what you had in fourth quarter and Q1, 2012. Could you give insight on what contributed to the strong sales in Q3 or in other words the gap between those numbers. I am wondering whether the strong number in Q3, 2011 was attributed to like the adoption process of your customers?

We believe it was. I mean that was clearly the largest quarter for post material by far. I mean, it was $7.8 million post materials in that quarter. And in any other quarter, it’s not going above $2 million. So that was quite a bit that we sold and customers put it into products. And it also maybe that customers work quite a bit and there were still some inventory. So it is -- that clearly was a quarter where we -- our material sales were higher than earnings as we see these sales would be. Hendi Susanto – Gabelli: Thank you, Sid.

Thank you.

And Mr. Abramson, I would like to turn the conference back over to you.

We’d like to thank you all very much for being on the call. If you have any additional questions, please either call or send me or Sid an email and we’d be happy to help. Again, thank you very much for joining us this afternoon.

And that does conclude today’s teleconference. We thank you all for your participation.