Good day and welcome everyone to the Sypris Solutions, Inc. Conference Call. Today's call is being recorded. At this time, for opening remarks, I’d like to turn the conference over to President and Chief Executive Officer, Mr. Jeffrey Gill. Please go ahead, sir.

Thank you, Cecilia, and good morning, everyone. Tony Allen and I would like to welcome you to this call, the purpose of which is to review the Company's financial results for the third quarter of 2017. For those of you who have access to our PowerPoint presentation this morning. Please advance to Slide 2 now. We always begin these calls with a note that some of what we might discuss here today may include projections and other forward-looking statements. No assurance can be given that these projections and statements will be achieved and actual results could differ materially from those projected as a result of several factors. These factors are included in the Company's filings with the Securities and Exchange Commission. And in compliance with Regulation G, you can access our Web site at sypris.com to review the definitions of any non-GAAP financial measures that may be discussed during this call. With these qualifications in mind, we would now like to proceed with the business discussion. Please advance to Slide 3. I will lead you through the first half of our presentation this morning, starting with an overview of the highlights for the quarter, to be followed by an update on the status of our transition plan implementation and our new business awards. Tony will then provide you with a more detailed review of our financial results for the quarter as well as to walk you through the significant savings we expect to realize in 2017 and 2018, when compared to the year 2016. Now let’s begin with an overview on Slide 4. During the quarter, we continue to make important progress across a number of fronts with a financial results for the period were clearly mixed with Sypris Electronics continuing to perform well, while we stumbled a bit at…

Thanks, Jeff. Good morning everyone. I'd like to discuss with you some of the highlights of our third quarter financial results. Please advance to Slide 12. Q3 consolidated revenue closed at $21.4 million, which was consistent with the prior year period and keeps us on track for our second half of 2017 revenue target. The revenue split between Sypris Technologies and Sypris Electronics was $13.5 million and $7.8 million, respectively. Revenue for Sypris Electronics increased by $1.2 million compared to the prior year third quarter which was offset by a decrease for Sypris Technologies of an equivalent amount. Our gross profit for Q3 was $650,000 which represents a $1.2 million improvement over the prior year period. Sypris Electronics had another strong performance in Q3 with gross margin of 16.8% as compared to a negative 3% result in the prior year. Consolidated gross margin for the quarter was 3.1%, which was an increase of 570 basis points from the prior year, but short of expectations as our revenue mix and cost were impacted by the transition of production within Sypris Technologies. With the announcement to accelerate the end of production at our Broadway facility to November, coupled with the advancements our team in Toluca has made in the product launch for the transferred business, we expect equipment operational availability and labor productivity to begin to meet our targets in the fourth quarter and to further improve as we progress through 2018. Selling, general and administrative expense was $3.1 million in Q3, a decline of $2.2 million from the prior year period and represents 14.7% of revenue in the current period as compared to 25.1% in the prior year. Reductions across the business primarily related to the cost reduction program we’ve discussed contribute to this improvement and we are working diligently to…

Thank you. [Operator Instructions] And we will take our first question from Joel Cahill of The Jameson Companies.

Hey, guys.

Hi, Joe.

Thanks for the call.

Good morning, Joe.

So, obviously we’ve some disappointments from last quarter, we are talking about profitability in the second half of this year and now we’re pushing that out to kind of midyear next year. What is that’s getting you guys excited at this point? It sounds like energy, despite this delivery delay, I mean, energy continuing to move along well. Obviously, the Harris stuff is nice and with the -- I’m assuming with the kind of tight revenue forecast for next year you’re feeling confident on existing and potentially some new projects?

Joe, this is Jeff. An answer to your question, the first point with regard to the shift in our return to profitability from the latter part of this year to the first part of next year, really reflects the realization of the transition costs that that we’ve had to incur to get things completed. And so, in terms of outlook for our markets, in terms of our backlog, in terms of our new customer awards, all of those things are proceeding in a very positive way. When we look at the energy field, things have been very positive for us in that aspect and as we look forward with the price stability ranging between $55 and $60 of oil with the continued production of Shale and natural gas, it's a very interesting field for us. In electronics, we've got some great momentum there. The guys, our team in electronics is doing a magnificent job. And in the heavy truck market, in 2018, we will be launching a number of the new programs that we’ve talked about during previous calls that should carry growth in that side of the business through the back half of '18 and into '19. So with the wrap-up of all the major moves, as you may recall with this early closure of Broadway, which was originally anticipated to operate through 2018 will now have reduced our overall footprint by over a million square feet and the cost saving is significant.

Do you expect -- we're talking about -- end of quarter cash balance is staying pretty stable and it looks like there has been a little bit of deterioration probably I’m assuming some of that could be from this -- the energy delivery delay given that you’ve taken a lot of the cost, recognize a lot of the costs. Do you expect that going forward we will be able to maintain cash balances around these levels are better?

Yes, what we -- you’re right on your comment on the shipments and further what we're coming out of is an investment in some of the inventory to support the transition that we’ve been going through. So, yes, we expect to see that improve as we move through Q4 and that we will be certainly doing everything we can looking for other opportunities outside of operations to drive cash flow.

The -- do you have any estimate on how much cash to be generated from some of these idle assets that you’re looking to sell?

Yes, we do, Joe. But I think that the timing of that is always subject to the market and those types of things. So we haven't talked about that publicly, but the potential I think is fairly material, certainly in low seven-figures type thing.

Okay. And on -- we are talking about gross margins been 15% to 17% range, on about $90 million. A lot of that still is going to get eaten up by SG&A. Do you have any thoughts on ways to continue to improve from there? I mean, I know we’re talking about profitability for next -- coming the next year, but while the margin -- the gross margin expansion is great, it's awesome and I certainly applaud it, it is going to get quickly eaten up, it still looks like.

Yes. So we’re, as discussed during the call, we’re down considerably on an year-over-year basis from '16 to '17, and we do believe in both absolute dollars certainly and as a percent of revenue, and we believe that going into '18 now, we will have more opportunities to drive that relationship, that metric down going forward to contribute to the profitability as you point out. With the margins of 15% to 17%, we're looking for opportunities to further reduce SG&A.

And my final one guys, I appreciate your help. As cash is stable and losses are removed, do you have thoughts on uses for that cash whether it would be for reinvestment, potentially paying down just family's note or potentially any buybacks?

Well, our plans, Joe, at this point are to build the business and we need to grow the business to get the level of profitability where it really needs to be. And so our plans would be to try to beat the objectives that we’ve laid out for our sales for 2018.

All right. Thank you, guys. I appreciate your time this morning. That’s all I have.

Yes, thank you. Yes.

[Operator Instructions] And with no further questions in queue, I’d like to turn the conference back over to Mr. Jeffrey Gill for any additional or closing remarks. End of Q&A:

Thank you, Cecilia. Tony and I would like to thank you for joining us on this call. We welcome your continued interest and of course your questions about our business. Thank you and have a great day.

Again that does conclude today’s conference ladies and gentlemen. We appreciate everyone's participation today. You may now disconnect.