Good morning, and thank you for joining the AstroNova's Fiscal Second Quarter 2023 Financial Results Conference Call. Today's call will begin in a few moments time. If you wish to register a question for the Q&A portion of today's call, please press star followed by one on your telephone keypad. Thank you for your patience. Good day, and welcome to the AstroNova's Fiscal Second Quarter 2023 Financial Results Conference Call. Today's conference is being recorded. I would now like to turn the conference over to Scott Solomon of the company's investor relations firm, Sharon Merrill Associates. Please go ahead, sir. Thank you, Carla. Good morning, everyone, and thanks for joining us on our fiscal second quarter 2024 earnings call. Hosting this morning's call are Greg Woods, AstroNova's President and Chief Executive Officer, and David Smith, Vice President and Chief Financial Officer. Greg will discuss the company's operating highlights. David will take you through the financials at a high level. Greg will make some concluding comments, and then management will be happy to take your questions. By now, you should have received a copy of the earnings release that was issued this morning. If you don't have a copy, please go to the Investors page of the AstroNova website, www.astronovainc.com. Please note that statements made on today's call that are not statements of historical fact are considered forward-looking statements.... within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on a number of assumptions that could involve risks and uncertainties. Accordingly, actual results could differ materially, except as required by law. Any forward-looking statements speak only as of today, September 6th, 2023. AstroNova undertakes no obligation to update these forward-looking statements. For further information regarding the forward-looking statements and the factors that may cause differences, please see the risk factors in AstroNova's annual report on Form 10-K and other filings the company makes with the Securities and Exchange Commission. On today's call, management will be referring to non-GAAP financial measures. AstroNova believes that the inclusion of these financial measures helps investors gain a meaningful understanding of the changes in the company's core operating results. It also helps investors who wish to make comparisons between AstroNova and other companies on both a GAAP and a non-GAAP basis. A reconciliation of the non-GAAP financial measures to their most directly comparable GAAP measures is available in today's earnings release. With that, I'll turn the call over to Greg. Thank you, Scott. Good morning, everyone, and thank you for joining us. At the beginning of August, we announced the strategic realignment of our product identification segment, an initiative designed to further capitalize on the synergies of last year's acquisition of Astro Machine. That restructuring is reflected in the second quarter financial results that we reported this morning. As a reminder, the specific actions we have taken to realign the segment include, first, transitioning more of our PI printer manufacturing from Asia and our headquarters in West Warwick, Rhode Island, to our Astro Machine plant in Elk Grove Village, Illinois. Second, rationalizing our combined AstroNova and Astro Machine PI product portfolios by exiting certain lower margin or low volume label printers to concentrate on higher margin product lines with advanced functionality and greater demand. And third, consolidating our international PI sales and distribution facilities and streamlining our global channel partner network. These actions enable us to concentrate the segment's manufacturing, marketing, and sales resources on the highest return opportunities. This, in turn, will provide the best products and services to our customers. Although the realignment had a negative effect on our GAAP performance in the second quarter, it puts us in a position to achieve an anticipated annualized cost savings of $2.4 million and create a stronger, more resilient business in the quarters to come. Beyond the restructuring impact, during the second quarter, we continued to make operating efficiency improvements, and we posted double-digit year-over-year top-line growth. The key growth drivers were Astro Machine, which we acquired in the fiscal Q3 of last year, and the continued momentum of the commercial aviation industry, which is served by our aerospace product line within our Test & Measurement segment. Looking at our performance by segment, Product Identification revenue was up 10% in the quarter, and excluding the restructuring charges, segment operating profit improved by 80%. Over the past several quarters, the performance of the PI segment has been tamped down as we work through our program to retrofit a large number of high-volume printers sidelined due to a supplier's ink quality issue. As an integral part of our restructuring effort to improve the PI segment, we established a reserve to account for the costs of an accelerated effort to rapidly repair or replace affected printers in the field, so they can more quickly be returned to full service. We expect to complete this retrofit program by the end of the current fiscal year. Product development continues to be and represent an important part of a growth engine for the PI business, enabling us to increase the breadth of our solutions for brand owners, OEMs, and commercial printers. This quarter, we plan to introduce four innovative new products to the market for applications, including labeling, direct-to-package overprinting, and high-speed mailing and addressing. Earlier this year, we introduced the QL-900, a high-speed, high-performance label printer. Printing at speeds of up to 12 inches per second, the QL-900 prints vibrant, wide-format color labels at a resolution of 1,600 dots per inch, making it a robust solution for the most demanding applications. Our customers will have the opportunity to see these and other products in action at several major industry events taking place in the coming weeks. These events include Pack Expo in Las Vegas, Labelexpo Europe in Brussels, and the Printing United Expo in Atlanta. Turning to our Test & Measurement segment, revenue also increased 10% year-over-year in the second quarter, reflecting the continued strong performance of the aerospace market. Robust airline passenger traffic and increased aircraft deliveries are driving stronger demand trends for our aerospace printers, supplies, and services. Segment operating profit was down year-over-year, however, due primarily to a higher-than-normal adverse mix of older generation product shipments in the quarter. We continue to focus on upgrading and transitioning aerospace customers from these older generation products to our newer, more advanced ToughWriter family of printers. As we gradually consolidate our product offerings into fewer, high-volume SKUs, we expect the resulting manufacturing efficiencies will positively impact segment margins. With that, I'll hand it over to David for the financial review. Thank you, Greg, and good morning, everybody. I'll start with an overview of the impact of the restructuring charges on our GAAP and non-GAAP results in the quarter. Restructuring expenses, restructuring expenses totaled $2.7 million this quarter. It consisted of about $2 million for the write-off of certain PI inventory, $611,000 in severance costs spread across our geographic footprint, but concentrated primarily in the U.S. and EMEA, and $48,000 in lease abandonment expenses. The inventory written off was for low volume, lower margin products. This action allows us to concentrate more efficiently on a small set of higher margin products that cover all of the expected applications that our customers have. We closed a product showroom that was not being used. In a closely related action, we recognized a liability for $852,000 in expenses in connection with the printer retrofit program that Greg described. The program's supported by a very detailed schedule of by customer action steps, and we're on track to complete it during this fiscal year. We've backed out both of these charges from our GAAP financials to give you a clear picture of the business on a non-GAAP basis, as is presented in detail in the tables included in the press release. All of these details will be further discussed in our 10-Q when it is filed tomorrow. In sum, we delivered net income after tax of $1.1 million, or $0.15 per diluted share in the second quarter on a non-GAAP basis. As Greg said, revenue in the quarter was up 10% to $35.5 million, driven by gains in both segments, and the PI gains were attributable to the Astro Machine acquisition. Compared to last year, operating expenses on a non-GAAP basis, excluding the restructuring charges and the retrofit program costs, were up only about $200,000 or 2% in the quarter from last year, and that was prior to the addition of Astro Machine, just a year ago. Astro Machine operating expenses exceeded that amount. Also, when excluding the non-GAAP charges in the quarter, adjusted EBITDA increased to $3.7 million, or 10.3% of revenue, up from $2.2 million, or 6.7% of revenue in the same period last year. Looking at revenue by type, hardware revenue grew by 31% to $11.3 million. Supplies revenue increased 3% to $19.7 million, while the service and other category increased 2% to $4.6 million. In total, hardware revenue accounted for 32% of total revenue in the second quarter, up from 26%. Last year, supplies made up 55% of total revenue, compared with 59% last year, and service and other comprised the remaining 13% versus 15% in Q2 of fiscal 2023. From a geographic perspective, domestic revenue accounted for nearly 63% of total revenue, up from 59% in the second quarter last year, and international revenue, the other 37%, compared with 41% last year. In dollars, we saw double-digit revenue growth in the U.S., while Europe and Asia were down low single digits. At the end of the quarter, cash was $4.5 million, up $600,000 from the end of the fiscal year that ended on January 31st. Total debt at the end of Q2 was $27.3 million, down $2.7 million from the end of the year. We're in compliance with all our debt covenants, and we have sufficient capacity to support all the operating needs of our business. We still plan to invest about $1.7 million in new capital equipment that will upgrade our hardware and supplies manufacturing equipment to improve efficiency and keep up with demand, and we'll finance that through our bank outside of the capacity of our existing credit facilities. Inventory investment declined modestly in the quarter before the effect of the inventory write-off for the products we're getting out of. We're still experiencing some supply chain struggles, primarily electronic components used in T&M products, and in a few instances, we are still needing to maintain extra buffer stocks. However, there are clear signs that those supply chain issues in aggregate are abating, and we still believe that our inventory levels will decline as we move through the year. Our current plan is to use any free cash flow to reduce debt. So now I'll turn the call back to Greg for closing comments. Thanks, David. With the strategic realignment of the PI business behind us, we enter the second half of 2024, well-positioned for accelerated revenue growth and margin improvement. We are very excited about the four new PI products to be unveiled in the coming weeks and expect our T&M segment to continue benefiting from the strong demand environment we are seeing in the commercial aviation market. With that, David and I will be happy to take your questions. Operator? Thank you. If you'd like to ask a question on today's call, you may do so by pressing star followed by one on your telephone keypad. To revoke your question, please press star followed by two. When preparing for your question, please ensure your phone is unmuted locally. We will now take our first question, which comes from Peter Sidoti, from Sidoti & Co. Peter, your line is now open. Please go ahead. Good morning, gentlemen. Just a quick question. Can you talk about your capital spending for this year and next? And with these adjustments, can you talk about the free cash flow you'll be freeing up? Sure. We'll let David handle that one. Peter. Yeah, Peter, we're gonna spend probably right around $2 million this year, which traditionally would have been pretty consistent. We had a period where we were spending a little bit more on business systems, and that's, that's behind us now. Traditionally, we've said that we'd spend about $2 million a year in maintenance CapEx. I don't think it's probably quite that high. I think it's probably more like $1 million-$1.5 million in maintenance CapEx, but about $2 million this year as we make those investments. I think the critical issue on the free cash flow side is working capital management, and I mentioned that a little bit during my remarks, where our focus is on reducing inventory and improving terms, converting more of our earnings to free cash, and utilizing the balance sheet more efficiently. And clearly, streamlining the product line should help us in that direction, but we don't have any specific guidance. Okay. Thank you, gentlemen. Thanks, Peter. Our next question comes from Samir Patel from Askeladden Capital. Samir, your line is now open. Please go ahead. Hey, Greg. Hey, David. First question is- Sure On the restructuring benefits, you know, you quoted $2.4 million in cost savings. I wanted to understand, are those just direct costs, such as, you know, leases, manufacturing costs, labor, or does that include any of the benefit from, you know, getting these printers retrofitted more quickly and getting those units returning to consuming supplies, or is that, or would that be incremental to those restructuring benefits? That would be incremental. Correct. Okay. That makes sense. And then the second question is, you know, I noticed that the bookings were down fairly significantly. We talked about kind of strong demand. Is that just related to some of that product realignment or some of the printer issues, or maybe you could help me understand what's going on there? Yeah, it's, it depends on, you know. Yeah, I can, I can address that. So it, it's a combination of, two different factors, really. So it's, when we get blanket orders, that tends to boost it up, and then we kind of work those down. That happens more from the Test & Measurement side of the business. We get kind of large blankets that come in a, kind of a bulk, way, quarter, you know, quarter to quarter just services. Yeah, you know, the PI business tends to be fairly steady, although, you know, as I kind of mentioned in my notes there, with some of these printers offline, the, you know, ink demand for the printers that are offline, does decrease. And the affected printers, unfortunately, tend to be our higher-highest volume machines. You know, it's nothing- On the TrojanLabel side, right? Out of the ordinary. Pardon? I said it's mostly on the Trojan Label side. On the, for- The affected machines For the bookings? For the affected- The affected The ones that are being retrofitted. Okay. Yeah, the affected machines- Um- are Trojan machines. Gotcha. So your summary, you'd say that it's not any sort of a, you know, there's not really a structural demand issue, it's more just, kind of a timing of some of the lumpier orders? Correct. Yeah. Keep in mind that the backlog in the aerospace business is very lumpy and is not necessarily a great indicator of revenues in the short term. The PI business is a little bit more short cycle, although, as Greg discussed, we do get quite a few blanket orders for labels on that side of the business as well. So it's an interesting metric, but it can't be used effectively, I don't think, to predict, you know, short-term revenues. It's important, obviously, to have a lot of bookings, but it will fluctuate. All right. Understood. I'll turn it back over. Thanks. Thanks, man. Thanks, Samir. As a reminder, if you would like to ask a question, please press star followed by one on your telephone keypad. Our next question is from Tom Spiro, from Spiro Capital. Tom, your line is now open. Please go ahead. Good morning, Greg. Good morning, Dave. Hey, Tom. Hey. First on the restructuring and retrofit initiatives. With respect to retrofit, the charge I see is $852,000. My recollection is that, a month or so ago, you folks estimated that at $600,000. If, if I'm recalling correctly, can you explain the difference? Yeah, I can give it, kind of the high level on that, is that, as I mentioned in my comments, we wanted to get this done and make sure we get it done, as fast as possible. So that involves more, direct travel to customer sites as opposed to, you know, sending a unit in, you know, you know, checking it, then validating, then updating it, then sending it back out. So for certain, customers, you know, more of the high volume ones, we're actually gonna go on site and do it that way. So that's more expensive, but it gets it done quicker. This process will be complete by the end of the fiscal year? Yeah. We've got a very systematic process on that. I mean, there could be a few stragglers, but, you know, by and large, you know, well over, you know, 90%. We expect, you know, if it follows our plan, it'll be over 100%. I mean, at, at 100%, sorry. I see. Okay, that's very helpful. Thanks very much. There are some low volume and low margin products that we're withdrawing from. We're streamlining channel partners, et cetera, et cetera. Roughly speaking, how much by way of sales will we be walking away from through these initiatives? It's very little on the sales front. It's part of it. It's really some overlap in products between, you know, the AstroNova products, pre Astro Machine acquisition and post. And we kind of did a lineup and, in some cases, the AstroNova product is gonna win out, or has won out, and in other cases, it's the Astro Machine product. So we're kind of... That's the bulk of what we're doing, is consolidating and rationalizing those product lines between the two, 'cause there's no point in having two kind of products that are very similar, just with different brand names on the box. And there are some, you know, other products that, they were decreasing and currently low revenue anyway. Just to streamline operations, we've, you know, end-of-lifed those products so we can, you know, eliminate those manufacturing processes associated with those units. Thanks. And on the streamlining of channel partners or reducing channel partners, are we doing that domestically, primarily? Is that where that's occurring? Is that overseas? Is it both? No, no, it's globally. So it's, it's in all regions, and it's really to get more focused. Kind of, you know, there's, you know, some, whatever. You know, we're keeping the best of the breed out there and making sure that we have, you know, channel partners that are totally aligned with our strategy, and also where we have overlap, again, between Astro Machine distributors and AstroNova distributors, you know, we're kind of, you know, sorting that out as well. So it's really just to make sure that, you know, within each given geographic region, we have a strong partner who's, you know, dedicated to AstroNova. I see. And on Astro Machine, as I recall, when we acquired it, its sales were running something like $21-$23 million a year. And then I believe last quarter, it seemed kind of a little weak on a quarterly basis. Is it still running at that annual rate of $21.23? Has it changed much? It's off a bit from where it was running, but I don't know if we disclosed that. Is that in the queue, David? The amount of the current quarter will be in the queue. And it's still running- Yeah ... in the same range, slightly lower, but I think by the end of the year, we'll be in the range that you talked about. I see. I see. So product, I'm sorry, did I cut you off? No, just Greg, I was just gonna highlight something I said last quarter as well, is that the, from what we've seen in the historical information from Astro Machine, their second half of the year tends to be stronger than the first half. I see. So if I were to look at the PI sales for the quarter of just under $26 and back out $5-ish, PI is running well under where it was last year. It is running last year. It's behind where it was, yeah. Yeah. Okay. All right. This is most helpful. Thanks very much, and good luck. Thanks, Tom. Thanks, Tom. Our next question comes from John Deysher from Pinnacle. John, your line is now open. Please go ahead. Good morning. Just a quick question on the retrofit expense, $852,000. That seems to be a supplier-related issue, and I'm just curious, are they sharing in any of the costs of retrofitting the machines, and do we have any recourse against them? Well, yes and yes, and it's something that we actually announced that earlier. So there was a financial restructuring. There's also some pricing concessions as well. Sorry, I must have missed that. Where, where was that disclosed? Was it a year and a half, David, two years ago? I forget exactly what quarter that came out in. I can't remember the quarter. It was back when we first recognized what that was, and there's a limitation of liability per event in that particular supplier's contract. Limitation of liability, okay. Do you pay for- Yeah, to maximize the payout from that provider. Go ahead. Okay, I was just gonna say, so there's really no recourse at this point, against the supplier? No, we in this- [crosstalk] Yeah. Okay. Separate from that, we go through the longer-term pricing deal. [crosstalk] [crosstalk] Go ahead. The amount that we have on the income statement is, or that we reported, is the amount that will hit us. Right. Okay. If that's helpful. Well, I guess, but I'm trying to understand, is the supplier matching that obligation, or who's on the hook primarily here, you or the supplier? Well, it's a shared amount, but we're not, you know... Because of the negotiations, we don't release the exact dollar amounts between the two of us. Okay. You know, all we can disclose is what we're reserving for. All right. Thanks very much. Yeah. Thanks, John. Our next question comes from Dennis Scannell, from Rutabaga Capital Management. Dennis, your line is now open. Please go ahead. Yes, good morning. Most of my questions have been answered. Just, just real quick, though, maybe could you talk a little bit about the timing of the $2.4 million in savings? Kind of how that'll leg in over the next few quarters and kind of when you, when you expect to be realizing the full benefit of the realignment actions? Yeah. So as far as the $2.4 million, that's what we expect to get on an annualized basis, but it will take a little bit of time to ramp up. So, you know, it'll ramp, but it's not, you know, really back-end loaded. It's just that, there's kind of a start-up go in Q3 and Q4 to get to the, you know, full amount. But we fully expect to hit it, you know, within the 12-month period, you know, this fourth quarter. And then it, it's, it's an ongoing benefit, of course, yeah. Right. Yeah. So annualized. Yes, and- So full benefit in fiscal 2025 then? Is that your January 2025 fiscal year? Certainly that is- [crosstalk] in the next four quarters. Yeah. Yeah. Okay, great. Thank you. Sure. Thanks, Dennis. We now have a follow-up question from Samir Patel, from Askeladden Capital Management. Please go ahead when you're ready. Hey, a couple follow-ups. One is, you didn't talk, unless I missed it, about the e-commerce site, just kind of any early readings there? Sure. Yeah, so we continue to add customers there, so that's you know, I don't know if you've been on it, but there's more and more things getting added to it and linked into it. So that's growing. We'd like to see it grow a bit faster, but you know, it's more an uptake, and we've got our customer service people, whenever they're talking to our customers, you know, encouraging them to use it. But we also picked up you know, a fair number of third-party, we call them third-party customers, where they bought a printer from somebody else, but they're buying label material from us via the e-commerce site. The other benefit, Samir, from that is, we're seeing a nice uptick in our internet, you know, marketing results, you know, getting higher up in search, and a higher number of inquiries. Got it. And then, I know we've talked about this before. Is there, you know, with where you are right now with the retrofits, I mean, do you have any sort of sizing around how much of an impact those issues are to your revenue in the T&M segment? You know, or put differently, like, you know, you did $26 million this quarter, give or take. I mean, where would you see that figure once you get those retrofits done, kind of based on the, you know, supply, the printers that are offline and the supplies that you're not selling? Yeah, we haven't given guidance on that. I mean, what I can tell you is, you know, the T2-Cs that are primarily, you know, the ones that have the highest volume that are impacted by that, they typically generate in the neighborhood of $20,000 to a year in revenue. There's roughly, I think we're about halfway through that upgrade program, so, as far as units that are touched, you know... One thing to keep in mind, too, is once we upgrade it, then they need to use the, you know, ink supplies and/or label supplies that they have in-house, yeah, before they buy more. There's a bit of a ramp-up in that process. Yeah, Samir, it's David. I'll just comment that obviously, to take a step like this, where we are moving rapidly to spend all this money, we are expecting a return on that. I mean, it's a good economic decision to do it. The faster we do it, the faster we'll get the money back. So, you know, I think it's pretty high return, we think it's a pretty high return endeavor from a cash flow perspective. Okay. That makes sense. That's helpful. Thanks. Thanks, Samir. At this time, we have no further questions registered. So with that, I will hand back to Greg Woods for final remarks. Great. Well, thank you everyone for joining us here this morning, and we look forward to keeping you updated on our progress. Have a good rest of the day. Bye now. This concludes today's call. Thank you for your participation. You may now disconnect your lines.