Good morning, ladies and gentlemen, and welcome to the BK Technologies Corporation conference call for the third quarter, 2024. This call is being recorded. All participants have been placed on a listen-only mode. Following management's prepared remarks, the call will be open for questions. There's a slide presentation that accompanies today's remarks, which can be accessed via the webcast. At this time, it is my pleasure to turn the floor over to your host for today's call, John Nesbett of IMS Investor Relations. Please go ahead. Thank you. Good morning and welcome to our conference call to discuss BK Technologies' results for the third quarter of 2024. On the call today are John Suzuki, Chief Executive Officer, and Scott Malmanger, Chief Financial Officer. I'll take a moment to read the safe harbor statements, statements made during this conference call and presented in the presentation that are not based on historical facts or forward-looking statements. Such statements include, but are not limited to, projections or statements of future goals and targets regarding the company's revenue and profits. These statements are subject to known and unknown factors and risks. The company's actual results, performance, and achievements may differ materially from those expressed or implied by these forward-looking statements, and some of the factors and risks that could cause or contribute any such material differences have been described in this morning's press release and BK's filings with the U.S. Securities and Exchange Commission. These statements are based on information and understandings that are believed to be accurate as of today, and we do not undertake any duty to update such forward-looking statements. Okay, and I'll turn the call over to John Suzuki, Chief Executive Officer at BK Technologies. Please go ahead, John. Thank you, John. Thank you, everyone, for joining today. I'll start by reviewing some of the highlights of our operations and financial results during the quarter. Then I'll turn it over to our Chief Financial Officer, Scott Malmanger, for a deeper dive into our financial results. We'll conclude by opening up the call for a brief Q&A. The third quarter of 2024 was highlighted by solid progress and execution on our operational goals. We achieved our fifth consecutive quarter of profitability with GAAP earnings per share of $0.67 and year-to-date earnings per share of $1.33. Given our progress in the quarter, we will be providing updates to our financial targets later in this presentation. Third quarter backlog remained strong at $27 million, supported by solid order activity for our BKR 5000 and BKR 9000 radios from both new and existing customers looking to upgrade their radio fleets. We also continued our trend of incremental margin improvement with gross margins of 38.8% in the quarter, driven by a combination of strategic cost reduction initiatives and a shift in product mix to include more BKR Series radio sales. During the quarter, we completed our manufacturing transition project to East West Manufacturing, with the majority of our third quarter revenue generated from products manufactured by East West. Additionally, lower product costs related to the transition favorably impacted our gross margin performance, and we expect to see continued margin improvement moving forward as we realize the full savings of the East West partnership. We continue to receive strong order activity for our BKR Series radios from both new and existing customers in the quarter. Specifically, the BKR 9000 is receiving substantial interest from state and local agencies, and our order activity has been encouraging. One order in the quarter that I'd like to highlight was received from the Florida Forest Service, a longstanding customer of BK, for the BKR 9000 at a total value of $3.3 million. The radios will be used by several different branches throughout the organization, including Wildland Fire and Land Management, for fighting active fires and facilitating controlled burns, as well as for research to improve biodiversity and ecosystem health. This order demonstrates the versatility of the BKR 9000 across varying departments and operations and is an example of the increasing demand that we're seeing from this radio among state and local agencies. Looking at the gross margin, we drove continued improvement in the quarter, largely related to our ability to reduce manufacturing expense through the outsourcing of our radio manufacturing to East West. We expect gross margins to continue to improve through 2024 and 2025 as we work towards achieving gross margins of 50%. As I mentioned earlier, we achieved our fifth consecutive quarter of profitability this quarter with earnings per share of $0.67, and we have significantly improved our profitability each quarter since the second quarter of 2023. What you'll note here is that while third quarter revenues were consistent with fiscal 2023 levels, the cost-saving initiatives and the transition to East West Manufacturing generated enhanced margin profile and profitability. Given our performance in the quarter and year-to-date, we have decided to revise our financial targets to better align with our expected results. We are raising our GAAP earnings per share and non-GAAP earnings per share targets for the full year of 2024. We are now targeting full-year GAAP EPS to exceed $1.65 per share, increased from our previous target of $1.50 per share, and non-GAAP EPS of $1.92 per share, which is an increase over our previous target of $1.77. Order activity has been strong, and we're especially encouraged by the demand we're seeing for the BKR 9000 multi-band radio from our existing Wildland Fire customer base. We received several purchase orders for the BKR 9000 in the third quarter, including a $3.3 million order from Florida Forest Service, as I discussed earlier, the Missouri Department of Natural Resources for their Wildland Fire operations, the Minnesota Department of Natural Resources for their Wildland Fire operations, and the Gallatin County Sheriff's Office in Montana, representing interest for the BKR 9000 from a law enforcement agency in a Tier 3 county. We closed the third quarter with a backlog of $27 million, which was supported in large part by the adoption of the BKR 5000 and BKR 9000 among new and existing customers. We anticipate that most of this backlog will be delivered in the fourth quarter of 2024 and the first quarter of 2025. We completed the transition program with East West Manufacturing in the quarter, a move that's already delivering cost reductions and production efficiencies. As we've mentioned before, our move to East West is expected to provide continued enhanced gross margins while also allowing us to more closely focus on new product development. We retained a small production team in our facility in Florida for the final assembly and test of the BKR 9000, as well as to support the production of some of the smaller low-volume specialty products. A new streamlined build-to-order final assembly process for the BKR 9000 was implemented and is expected to be able to produce up to 20,000 radios per year at full capacity. I will now turn the call over to our Chief Financial Officer, Scott Malmanger, to go over our financial results for the quarter. Scott? Thanks, John. Sales for the third quarter totaled approximately $20.2 million, essentially consistent with $20.1 million for the same quarter last year, which is in line with our expectation that 2024 revenue will be consistent with 2023 results. Gross profit margin in the second quarter was 38.8% as compared to 31.9% in the third quarter of 2023, which surpasses our target margin levels of 35% for 2024. We expect to continue to achieve margin improvement as we drive our cost reduction initiatives. Selling general and administrative expenses, or SG&A, for the third quarter totaled approximately $5.2 million compared to $5.8 million for the same quarter last year. Operating income totaled $2.6 million compared with an operating income of $594,000 in the third quarter of 2023. We recorded net income of $2.4 million, or $0.67 per basic and $0.63 per diluted share in the third quarter of 2024, compared with net income of $90,000, or $0.03 per basic and diluted share in the prior year period. Non-GAAP adjusted net income, which adds back net realized and unrealized gain or loss on investments, stock-based compensation expenses, and severance expenses, was $2.7 million, or an adjusted EPS of $0.75 per basic and $0.71 per diluted share compared with adjusted net income of $1.1 million, or $0.33 per basic and $0.32 per diluted share in the third quarter of 2023. We expect enhanced profitability as we continue to reduce costs and improve our gross margins and are confident in our revised target of full-year GAAP EPS exceeding $1.65 and full-year adjusted EPS target of $1.92 per share. We reported adjusted EBITDA of $3.1 million in the third quarter of 2024 compared with an adjusted EBITDA of $662,000 in the third quarter of 2023. Turning now to the company's liquidity, we significantly strengthened our balance sheet in the year-to-date period. As of September 30th, 2024, we have approximately $4.2 million of cash and cash equivalents and no debt. Working capital improved to approximately $22.7 million at September 30th, 2024, compared with $16.8 million at December 31st, 2023, driven by increases in accounts receivable that were somewhat offset by inventory reductions as we transitioned radio manufacturing lines to East West. Shareholders' equity has also increased to $26 million compared with $21.3 million at December 31st, 2023, demonstrating the enhanced value we've achieved year-to-date. With our visibility today, we believe that we are well-positioned to continue improving our balance sheet through the balance of 2024 and that our current cash position, combined with anticipated cash generated primarily by radio sales and borrowing availability under our credit facility, provides us with the working capital we need to grow our business. I'll now turn the call back over to John. Thank you, Scott. With the third quarter now closed, I'm pleased to say that we are on track to exceed our operational and financial targets for 2024. Our visibility today, we're confident in our ability to achieve full-year GAAP EPS to exceed $1.65 per share, up from $1.50, and non-GAAP EPS of $1.92 per share, up from $1.77. We have made solid progress throughout 2024 and believe these new targets better reflect our performance year-to-date and where the business is heading going forward. As we close out the year, we remain focused on accelerating the BKR 9000 adoption rate, winning new customers, and growing our market share. With that, we can now open the call for questions. Kelly? Certainly. The floor is now open for questions. If you have any questions or comments, please press star one on your phone at this time. We ask that while posing your question, you please pick up your handset if listening on a speakerphone to provide optimum sound quality. Please hold just a few moments while we poll for questions. Your first question is coming from Aaron Martin with AIGH Investment Partners. Please pose your question. Your line is live. Hi, good morning, guys. Congratulations on the quarter. And obviously, the increased operating leverage really shining through. So congratulations on that. Just a technical question. The $3.3 million order, was that included in the quarter-end backlog? Because you announced it after the end of the quarter. Yes. Thank you for the question, Aaron. Okay. And then can you remind us on the, as we look towards Q4 and then going into next year of the typical seasonality of the business? Yeah. Thank you again for the question, Aaron. This is John. So our strongest quarters for orders and revenues is Q2 and Q3. Our weakest quarter for new order business is Q4, and that's primarily driven from the fact that the third quarter is the end of the fiscal year for federal government, and they still represent about 35% or 40% of our business. So as you go into the fourth quarter, which is their first quarter of their fiscal year, their budgets just are not set. And as you know, we just went through an election, and they just went through a continuing resolution. So we continue to talk to our customers. We have an understanding of what they believe their budget will be. But typically, and again, I think this year, they're just not going to be in a position to start placing purchase orders in the fourth quarter. So that tends to be a lot lower. The first quarter tends to be stronger because now that's in their second quarter of their fiscal year. And then we're into second and third quarter of the calendar year. Got it. And on the gross margin, obviously, a great number. And you've continually talked about not stopping there, even though you're past your target. So what can you tell us about the trajectory there again into Q4 and 2025? Yeah. I think the best way to characterize that, Aaron, is that we're targeting that 50%, right? And we believe that is achievable through both the transfer that we've done, the cost downs that we've done, and the transition of the BKR 9000. So we believe that you'll see continued gross margin improvements. Now, as we get closer to 50%, we may take one step back, two steps forward, just because of the different quarters and what they bring. But we definitely are on track to achieve that. Got it. Okay. And then I guess that sort of brings up the Vision 2025. Talked about a target of revenue of $100 million and 50% gross margins. And any thoughts around that, again, as we go into 2025 past the Q4 seasonality? Sure. So Vision 2025 was set when I started with the business in July of 2021. That remains our vision, and that continues to be what the business is focused around achieving. In terms of what we will be looking at in 2025, I certainly don't want to get ahead of myself, and we'll be talking to the street during our fourth quarter call, which I think is going to be in March of 2025. So at that point, we will provide you what our targets will be for 2025. But nevertheless, right, Vision 2025 exists, and that's what the business is driving towards. Okay. Congratulations on the progress. You know what? Actually, in the past, you've given us a number of radios shipped in a quarter. What was the number for Q3 or for the first nine months? So we actually stopped that practice, Aaron, and we actually communicated that on a call. And the reason for that was the competitive nature of the BKR 9000. And we just didn't want to provide any additional information to our competitors. Because again, the BKR 9000 really starts approaching onto their customer base. And so for that reason, we decided not to disclose numbers of units sold. Okay. Congratulations again on the progress to manage operating leverage. Thank you, Aaron. Once again, if you do have any questions or comments, please press star one on your phone at this time. You have a question coming from Samir Patel with Askeladden Capital. Please pose your question. Your line is live. Hey, guys. Congrats on a good quarter. Thank you, Samir. So I have three questions. The first is maybe you could talk about you talked about continuing to ramp those efforts to sell the BKR 9000. Maybe you can talk about kind of the market segments where you're the most optimistic. For example, I noticed that in addition to the Florida win, that's more kind of a traditional customer, you highlighted a win with the sheriff's department in Montana, which I assume is maybe a new customer. And I know you were at IACP recently. So maybe just some thoughts on kind of segments where you're continuing to focus, where you're optimistic about being able to drive those sales. Yeah. That's a good question, so what we have been communicating in the past with the market for the BKR 9000, because it's an all-band radio, we felt that that radio was best positioned for law enforcement and what we call structural fire, so your local fire departments and ambulance services, so these are very large market segments that operate in urban environments, and typically, we haven't sold to them in the past, so it was a whole new market. If you look at the total market of radios in the U.S., which is about $2.3 billion, 85% of those radios fall into those types of categories, and so when we started the program on the BKR 9000, we certainly view that as our largest market opportunity. As we've launched the product, what surprised us the most is just the adoption within the Wildland F ire. These are people that typically operate in one-band VHF. They're very cost-conscious. And so our thought was that these guys would not be paying twice as much money for a multi-band radio. What we found over the last year is, while that's true for, say, US Forestry, one of our largest federal customers, they're still buying those BKR 5000s. A lot of the state agencies, what we found out was they have a real need to communicate on the statewide radio systems, which typically operate in a different band, say, 800 MHz. And so they're making the business case that says, "Hey, I need my radios for forestry services and Wildland Fire. It's got to be BK. Why don't I just pay a little bit more money, and I can get a radio that I can use on the statewide system to interoperate with all the other agencies?," and so that was probably our biggest surprise. Typically, again, these agencies are not as well-funded as, say, state law enforcement, but they are getting the funding based on that requirement and that need, and so from our perspective, that's actually a very strong positive. I mean, I guess the Boulder County order is kind of an example of that. Yeah. Boulder County is, at a county level, exactly that, but at a county level, right? You had 26 fire departments. All of them had BK radios for Wildland Fire, but they also had a different brand radio for their structural fire operations. So when they respond to a fire in their town or in the city, typically, they're not using their BK radio. They're using a competitor's radio. When they made the decision to buy new radios, it made sense to them just to buy one radio for both operations, for both missions. And then they could have one radio for all the fire services covering all missions. And of course, that was the BKR 9000. Okay. That's good. My second question, you didn't mention anything about the BKR 9500. And kind of in the research I've done, talking to people, it seems like there's a significant portion of the market that likes to purchase the mobile and portable radios as a bundle. And it seems like that's kind of a big unlock for you once you get that to market. So maybe you could talk about how that development process is going, kind of how heavy of a lift that is relative to developing the BKR 9000. And with your increased earnings and cash flow, is there any chance you could kind of reinvest maybe a little bit more to accelerate getting that product to market faster? Excellent question, Samir. We did announce that we were starting a program for the BKR 9500, which is the multi-band mobile. We did say that we expected to bring that market in 2027. So that's what we've said in the past. In terms of the development risk, they use a lot of the common architecture between the multi-band portable, the BKR 9000, and what will be the BKR 9500 mobile. So the core technology of doing multi-band will be very similar, if not the same, between the radios. Now, there's some nuance differences between a handheld device and a device that's on a mobile more in the mechanics that needs to be worked out. But that's engineering that's well understood in our industry. And I think it's relatively low risk. Now, the timeline on this, why the timeline takes as long as it does, is because you're looking at all new mechanics. And so when you're going through mechanical designs, there's the design process, and then there's the tooling, the time to do tooling, which could be three to four months. And then you produce the product, and then you go through several iterations. Unfortunately, it's not a high-risk function, but it just takes a lot of time. And it's really hard to compress that time. And so that's why we stated that we'd have a product out by 2027. Okay. Understood. And then the final question, sort of just a boring modeling thing. But I was looking at the deferred revenue line item on your balance sheet, and there's not really any disclosure around it. And it's sort of not obvious to me, other than InteropONE, what that might be. So could you just kind of clarify the source of the deferred revenue? Yeah. As part of our product offering, we have extended warranties. And so according to GAAP, that's a deferred revenue until the extended warranty period is exercised. So that's primarily all of the deferred revenue. That InteropONE. Yeah. In the InteropONE. Okay. Understood. Appreciate the clarification. I'll pass it back. Thanks. Thank you, Samir. Your next question is coming from Erik Voss with Mission Vertical. Please pose your question. Your line is live. Hey, John. Scott, can you hear me? Yes, sir. Congratulations on a great quarter and a good year here. Can you kind of take us through or help us with the working capital and kind of how you think that progresses over the next six months to a year? Sure. Basically, the improved gross margins are generating the working capital improvement. And as I mentioned in the remarks, basically, we paid off all of our debt, including the line of credit. And we've established a new line of credit on October 30th. So we've got the working capital necessary to basically grow the business to our target of $100 million of revenue. And basically, that would be generated by product sales. Okay. So this is the right level for working capital at this point? Yes. Okay. And then can you kind of talk about the progression of gross margin? That's been fantastic. Is there seasonality to the improvement going forward just because of the seasonality of the business? Or how should we think about gross margins over the next couple of quarters? Yeah. Hi, Erik, it's John. So you've got so many factors that are impacting the gross margin as we go forward. So let me just hit some of the seasonality ones, right? In Q2, Q3, there are strongest quarters, primarily because a lot of the federal orders come in and get shipped. There are also the price on those radios are, I guess, lowest price, right? They're most aggressive because they give us the most volume. And so in Q2, Q3 tends to be more pressure on the gross margin because of the lower average selling price of those radios. If you look in the past, you wouldn't see that in the chart because it was overachieved by the cost savings that we've had through our cost initiatives and then now going through East West. And then on top of it, as we go forward, we're getting more and more BKR 9000 shipped out, which is even a higher margin profile. So when we map it out over the next year, we can see a couple of different scenarios happening based on when we ship, say, the federal radios versus when we ship the BKR 9000 radios versus when some of the cost improvements would kick in. And so it's really hard for me to definitely say what that is going to look like. But in terms of price pressure, I guess, on mix, it's Q2, Q3. And that's mainly driven by the federal radios. Okay. Brilliant. All right. Nice job, guys. Thank you. You have a follow-up question coming from Samir Patel with Askeladden Capital. Please pose your question. Your line is live. Hey. Yeah. Sorry if I missed this, but any update on that BKR 9000 tethering capability with InteropONE? Because I know that was one of the things you were kind of excited about in terms of being able to drive sales of InteropONE. Yeah. So we've been working on the tethering approach for this last year. The development team has made some great strides in that, but we're still not at the point that we're comfortable putting it into a first responder's hand. But we do believe that the solutions that they're on track to get to that point. Again, it's not about just making the calls and making the connection. It's about resilience, right? So you have to be able to change knobs on the radio, do a whole bunch of crazy things, and that Bluetooth connection stays intact in all cases. And so what we found was there were a few scenarios where the Bluetooth would drop or the audio would get distorted. And that's just not acceptable. And so we're trying to weed out those edge cases before we go into field trials with customers. Because I would say it's a very new approach for this market. The market's said that they're very excited about this. And the last thing we want to do is turn them sour on the technology. Because everyone has a preconception of Bluetooth as a reliable technology. We want to make sure that whatever we put in the hands of these first responders, even in a test environment, is rock solid. And we're just not there yet today. Understood. Appreciate it. This does conclude our question-and-answer session. I would now like to turn the floor back over to John Suzuki for closing remarks. Thank you, Kelly. Thank you all for participating in today's call. We look forward to speaking with you again when we report our full year's results. All the best to you and have a great day. Thank you, everyone. This does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful day. Thank you for your participation.