Greetings, welcome to the Jerash Holdings Financial Results for fiscal 2022 first quarter conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Roger Pondel, investor relations for Jerash Holdings. Thank you, sir. You may begin. Thank you, operator, and good morning, everyone. Welcome to Jerash Holdings Fiscal 2022 First quarter conference call. I'm Roger Pondel with PondelWilkinson, Jerash Holdings investor relations firm. It will be my pleasure momentarily to introduce the company's chairman and chief executive officer, Sam Choi, his chief financial officer, Gilbert Lee, and Eric Tang, who leads the company's operations direct from Jordan. Before I turn the call over to Sam, I want to remind all listeners that today's call may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to numerous conditions, many of which are beyond the company's control, including those set forth in the risk factors section of the company's most recent Form 10-K and Form 10-Q, as filed with the Securities and Exchange Commission. Copies of which are available on the SEC's website at www.sec.gov, along with other company filings made with the SEC from time to time. Actual results could differ materially from these forward-looking statements. Jerash Holdings undertakes no obligation to update any forward-looking statements except as required by law. With that, it's my pleasure to turn the call over to Sam Choi. Sam? Thank you, Roger, and hello, everyone. Our fiscal 2022 first quarter results demonstrate excellent progress. Revenue was at a record level for the first quarter, reflecting robust shipments to our largest customers as a result of strong demand amid the reopening of the U.S. economy. Gross profit also represent a record for the first quarter, primarily due to higher revenue and gross margin performance. Our gross margin continued to run in the high teens, reflecting increased shipment volumes and an improved product mix in the first quarter. Our robust momentum is continuing further into fiscal 2022, with orders for the first nine months of the year that we believe will lead to a revenue run rate for the year that would exceed our prior record. As a result, we have increased our revenue outlook for the full year, which Gilbert will discuss shortly. We continue to advance plans to increase capacity in our existing facilities and secure additional capacity to meet our customers' demands, both by building new facilities and through leases and acquisitions. We recently announced the signing of definitive agreements to acquire both the operator of our 71,000 sq ft manufacturing facility in Amman, Jordan, and the related physical premises. We expect to close this acquisition soon. Eric will provide more details in a moment. I'll now turn the call over to Eric Tang, who is based in Jordan, and then to Gilbert Lee, who will cover our financial results. Eric? Thank you, Sam. Hello, everyone. Our factories in Jordan are extremely busy, and we continue to add capacity as quickly as we can. Order volumes are up substantially, and customers have returned to more typical ordering patterns. As anticipated, our product mix improved in the first quarter, leading to orders with higher average selling prices and margins than we saw in the last fiscal year. Moreover, this positive momentum is continuing. Capacity is completely booked through the end of January 2022. Based on orders from our four largest global brand customers alone. Bookings remain heavily weighted towards jacket and other outerwear products that have higher ASP and margins. As Sam mentioned, we recently signed agreements to expand our manufacturing capacity in Jordan. This particular acquisition is in two stages. First, we signed an agreement to acquire the operating company of a 71,000-square-foot apparel manufacturing plant. Under the terms of the first agreement, Jerash assumes the manufacturing licenses and existing physical operations, including all machinery equipment, 500 workers and employees, and the dormitory. We have taken over production at the new facility as of August 1st, and we have begun manufacturing products for our customers. However, because the seller has yet to complete production for its primary orders, we are allowing them to temporarily maintain one production line, which in turn has delayed formal closing of the first part of the acquisition until September. Second, we signed a separate agreement to acquire the land and the building that house the apparel manufacturing operations. We expect this part of the deal to close in November 2021. The new facility is expected to enable Jerash to produce approximately $2.5 million-$3.5 million additional garments per year, adding approximately 20% to our current annual capacity. In addition, the facility gives us the ability to scale up even further. Customers already are placing orders that are expected to fully book the new factory through January 2022. As mentioned last quarter, we began a construction of a high-quality living space for expanding multinational workforce with the highest safety and comfort designs that will help position us for growth and further our ESG goals. Finally, we recently announced plans to double worker capacity at our facility in Irbid as part of a special humanitarian project with the Jordanian government that began in 2018. We are very proud of our progress on this project, despite the unprecedented disruption caused by the pandemic. The facility currently employs 300 people there, and we plan to increase this to 600 by end of 2021. With that, I will turn the call over to Gilbert Lee to discuss our financial results and fiscal 2022 outlook. Gilbert, please. Thank you, Eric, and good morning, everyone. Our fiscal 2022 first quarter revenue rose substantially to $30 million from $19 million in the same period last year, an increase of nearly 60%. The increase was primarily due to higher shipments to our largest customers in the quarter. The higher sales volume reflects stronger demand as the U.S. economy continues to recover from the pandemic. Gross margin expanded 250 basis points to 18.8% in the fiscal 2022 first quarter, compared with 16.3% in the same period last year. Gross margin expansion in the quarter reflects a higher proportion of export orders, which typically carry higher profit margins, as well as increased production and sales volumes. Operating expenses totaled $3.3 million in the fiscal 2022 first quarter, compared with $1.9 million in the same period last year. The increase primarily reflect high headcount additions to support our growth, higher shipping costs that were in proportion with increased sales volumes, and expenses related to COVID-19 precaution and recruitment of new migrant workers. Operating income was $2.3 million in the fiscal 2022 first quarter, compared with $1.2 million in the same period last year. Comprehensive income attributable to Jerash's common stockholders was $2.0 million or $0.17 per share in the first quarter, compared with approximately $813,000 or $0.07 per share in the same period last year. Our balance sheet remains strong with cash and restricted cash of $9 million and net working capital of $51 million at June 30th, 2021. Inventory was $31 million, and accounts receivable was $20 million. Net cash used in operating activities was $11 million in the fiscal 2022 first quarter, compared with $8 million in the same period last year. The net change was primarily due to working capital activity. Inventories increased in the first quarter, primarily reflecting seasonal activity and strong demand. Accounts receivable also increased in the first quarter due to strong demand, particularly in the month of June. To date, we have collected more than 80% of receivables at the end of June. We continue to expect the business to generate cash from operating activities on an annual basis. We also have been granted supply chain financing programs by our major customers and an untapped $3 million line of credit available. In terms of our fiscal 2022 outlook, we are increasing our revenue guidance to be in the range of $115 million-$120 million as strong demand continues and our capacities expands. We also anticipate revenue in the fiscal 2022 second quarter to exceed $40 million. Orders continue to be heavily weighted toward high-margin jackets and other outerwear products. We expect this pattern to support gross margins in the high teens for the full fiscal 2023 year. I would also like to point out that operating expenses are expected to be higher in fiscal 2022, reflecting our growth and the pandemic's impact on last year's first half. We also anticipate stock-based compensation to be at a higher level for the rest of fiscal 2022 compared with the same period last year. While customer orders remain strong, it is important to note that potential risks from the Delta variant of COVID-19 could constrain our ability to add workers needed to run our factories at full capacity. To a certain extent, we already have reflected this risk in our updated outlook. We'll continue to monitor pandemic developments over the next few months and give you an update on the next quarter's earnings call. Our fiscal 2023 first quarter results represent a strong start to the year. This robust momentum is leading to what we believe will be a record year for the company. We look forward to keeping you apprised of our progress as the year unfolds. Lastly, our board of directors approved a regular quarterly dividend of $0.05 per share to our common shareholders, payable on August 24, 2021, to stockholders of record as of August 17, 2021. With that, we will now open up the call for questions. Operator, may we have the first question, please? Thank you. We will now be conducting a question and answer session. Our first question comes from the line of Mark Argento with Lake Street Capital. Please proceed with your question. Hi, guys. Good morning, and nice quarter. I just wanted to maybe peel the onion a little bit on the guidance, which was very strong. I had anticipated, with the 20% plus capacity expansion through the acquisition, that that would take maybe a little bit longer to come online. Maybe you could talk about what you're seeing that gives you the comfort and confidence to guide as strong as you have here in terms of onboarding that additional capacity. Secondly, maybe you could just talk about your overall order book, and do you have more orders than you do capacity at this point? Is there anything additional you could do in terms of maybe leasing some additional space as well? Thanks. Thank you, Mark. First of all, I think we are trying to be conservative because there are still a lot of uncertainties all over the world with the pandemic still going on in various parts of Asia, in particular with the Delta variant. We're right now facing some challenges in bringing in additional migrant workers from Asia, even though we're working very closely with the Jordanian government, and we see some very promising opportunities. We don't want to overextend ourselves. We do have orders from our major customers that far exceed the projection, we just want to make sure that we have the ability to produce and to ship throughout this fiscal year. We are confident with our capacity and with our ability that we will be able to fulfill this $120 million in revenue. In terms of the mix of the incremental revenue, is it going to be more outerwear? Maybe give us a little bit of an idea of how you think about the mix. Is it going to look mostly the same, just another incremental $15 million-$20 million in revenue, or is it going to change materially? I think the additional revenue or the increase in the revenue is going to be highly concentrated in outerwear because that's our intention. Even though the new facility, the new workers, they probably need some time to be trained to manufacture our products, especially those for our premium customers. Those are rather complex products. We started out the new factory by producing some of the lower margin or more simple products, such as T-shirts and polo shirts. Just to use that to get them acclimated to our processes. Once that is done, and we anticipate that maybe after this fiscal quarter, we should be able to convert them into producing the outerwear of the jackets. Also, we are working on expanding our satellite facility in Al- Hasa into making jackets. We are hiring more people in Al- Hasa and training them and converting that facility into producing some higher margin, higher ASP products. Just the last question from me. The new facility that you guys are purchasing or have purchased, is that in the same complex as your current facilities? Of course, Al- Hasa is outside, but within Amman area there, in the current campus? Yes. The new facility that we purchased is in Amman. Eric, is it in the same industrial park? Yes. Industrial zone area. The location, it is situated in the same industrial city which the Jerash main factory is situated. For walking distance from Jerash main factory to this new facility is only around five minutes by walking. Great. All right, guys. Appreciate it. Congrats on a strong quarter. Thank you very much. Thanks, Mark. Thank you. Thank you, Mark. Yeah, also thank you for all the long-time support of the company. Yeah. Our next question comes from the line of Rommel Dionisio with Aegis Capital. Please proceed with your question. Good morning. Thanks for taking my question. We hear so much about increased freight expense around the world, as well as raw materials. Maybe raw materials is a little less applicable to you, but I wonder if you could just talk about the potential impact that you're seeing on gross margins, if you're seeing any delays, especially on the shipment front. We definitely hear about some challenges in the world of global freight. Thank you. Thank you, Rommel. Well, there are some challenges, especially on the incoming freight, on the incoming shipment from Asia for our raw material and supplies. However, because we're working with global brand customers, they are very understanding, and if there is any delay from raw material, they wouldn't penalize us or they wouldn't complain. They understand. If the increase in raw material costs or the inbound freight, most of the time they will reflect in the order on the prices to accommodate for that. Can you confirm that, Eric? Yes. Recently, we faced some problems. I cannot say a lot of problems, but some problems in the incoming containers, especially from Southeast Asia countries like Vietnam, like Taiwan, such countries, because they have been locked down recently. Unfortunately, some of the orders fabrics from The North Face, they are also from these countries. The fabric mill they order is also from these countries. These fabric mills, which are situated in Vietnam and Taiwan, are the nominated supplier by the brand. Once we place the order, they have the responsibility to ship to Jordan on time in order that we can deliver on time. Nowadays, because of the lockdown, the shipment came in late for one month or two months. The brand understands very much it is not the responsibility of a manufacturing being Jerash. This is the responsibility of the fabric mill. Okay. The brand is very willing to grant us extension of the delivery for one or two months according to the delay of the container. Sometimes, some of the garments, they may need to reach U.S. soil by end of November because they have a big Christmas sale at that time. They will ask us to air freight some of the garments to U.S. on the cost of the brand. This is the situation. Thank you, Eric. Thank you. Thank you, Eric and Gilbert. Maybe just a follow-up, Gilbert. I think in the prior question you talked about the potential challenges if Delta variant in terms of importing labor, but you obviously have a significant labor base in Jordan, domestic labor as well. I wonder if you could just refresh our memories on the availability of that. In the event that you have difficulties importing labor from some of the Asian countries, to what extent you can just simply rely on domestic labor within Jordan itself? Thanks. We're actually trying to hire more domestic labor or local labors in Jordan. On one hand, we're working on importing more workers from Asian countries such as India and Bangladesh. We all know that those two countries right now are kind of in the lockdown, and we don't know how successful that will be. At the same time, comparing to other manufacturers in Jordan, we already have a significant advantage because we already have quite a bit of foreign workers working for us. We have very good reputation, and we have very good relationship with the government, and they're helping us, or they're trying as much as they could to help us get those workers qualified and imported into Jordan. However, the pandemic, nobody can control it. We do put a little bit of conservatism in our projection, just because of that. At the same time, we are working very hard to recruit local workers, Jordanians, even Syrian refugees who are residing in refugee camps. We provide those workers, because they don't have transportation, and they live about one hour away from our factory in refugees camps. They couldn't leave the camp to live in our dormitory because they were not allowed. We provide them transportation every day with buses to transport them to our facility to work and bring them back home. Those are the kind of things that we are working on to make sure that we have sufficient workers to satisfy our demand or our increase in production volume. Okay. That's very helpful. Congratulations on the quarter. Thank you. Thank you. Thank you, Rommel Dionisio. Our next question comes from Michael Wu, a private investor. Please proceed with your question. Hi. Just want to ask a question about The North Face order. Do you have any estimate of the full year order from The North Face? Hello, Michael. Yes. We do have orders from The North Face for the whole year. The order amount really actually exceeds our capacity or our projection. Because they place orders, we may or may not be able to fulfill all the orders. The North Face have been working with us for six or seven years. Almost every year, they would place orders more than we could supply them. They are very understanding. They know, and they keep increasing the demand for us to produce. It's just that, even though we keep increasing our capacity, our productivity, there is always increasing demand from The North Face. We do have rolling 12-month orders from The North Face, from New Balance, from a few of the other global brand customers. Could you just give me just more of a rough idea? Last year is down for more than 15% with fiscal 2020. Is that fair to assume that you will recover to 2020 level, or at least, or maybe even exceed? I'm sorry. You said, last year, which is fiscal 2021? Last year. Yes. It was down right. It was down. from 2020. Yeah. Yes. Obviously, because of the global pandemic, everybody's sales were down. We were only down 15% from the previous fiscal year, which was $93 million, and last year, we were at $90 million. Because in the second half of the last fiscal year, we basically fully recovered from the pandemic. The first half, it was down quite a bit. The second half, we were almost at the same level as the previous fiscal year. That rebound. Yeah. Sorry. Sorry. I'm sorry? Sorry. I'm asking only about The North Face order. It's not about the whole company. The 2020, the amount from The North Face is around $72 million, right? Last year is $56 million. I was asking maybe, The North Face order would be recovered to 2020, or would you have any idea? I don't have the numbers in front of me, but I could tell you that. Sorry. The North Face order. Gilbert, can I answer this question? Okay. Yeah, please. You are asking about The North Face order, the figure. Okay. The North Face orders, we are increasing almost every month at the request of the customers. Okay. As of today, in dollar value, we have already confirmed orders with The North Face more than $75 million. That's great. Yeah, that's exactly what I want to know. Thank you so much. I think the figures will still going up as we only started two quarter. Okay. maybe you guys will even get more orders, right? Yes. Sure. Okay. That's great. Second one is, how about New Balance? Any update and any trend from the order from them? The New Balance, compared with the fiscal 2021, this year, the customer is also increasing the order around 20% compared with last year. As a reminder, if you would like to ask a question, press star one on your telephone keypad. Our next question comes from the line of Barry Posternak, a private investor. Please proceed with your question. Hey, guys. Congratulations on the quarter, the guidance, and the acquisition. I was wondering, on the acquisition, how much of a temporary gross margin impact should we expect this fiscal year from digesting the acquisition or on the revenue coming from the acquisition from the factory? For the new acquisition. No. We expect. Yeah. I'm sorry. Go ahead. The new capacity, you're talking about the facility that we just acquired in August, right? Correct. This one, there is already 500 workers, and obviously, within the first six months, we need to get the workers trained and converted into manufacturing our products. Previously, they were manufacturing jeans for their customers. Now we're turning them into manufacturing our kinds of garment, which is apparel for sports, sporting apparels, and also outerwear jackets. It will take some time for them to get trained and get acclimated with our system. We expect the first six months to be a little bit, maybe not as profitable. We'll train them first on some of the orders that are less expensive, less complicated. Over time, they'll be able to do the same kind of products and at the same productivity and efficiency as all our other factories and all our other workers. I would say the first six months, it will have somewhat of a negative impact to our overall gross margin. We'll just have to see. We did because of the mix that we put into this factory. Putting all our other factories into manufacturing the higher premium, higher gross margin products, we think the impact would not be very significant. In other words. Does that answer your question? Yes. Right. The impact on the total company gross margin will be at least partly offset by higher margin product being produced in the existing factories. There shouldn't be, would you say, more than a 50 basis point or less gross margin impact during these six months from the acquisition? Would that be a fair estimate? I would say it will be anywhere between 50 to 100 basis point. Okay. In the overall, right now we have 5,000 workers in total in Jordan. 500 workers in the new facility. If we mix all the products together, I think the impact probably would not be more than 100 basis points. Okay, great. On the four largest customers you referenced earlier, are those all existing customers from last year, or is there a new customer in there? Yes, they are all existing customers from last year. New Balance and American Eagle were new customers last year. Okay. Is there also a new customer this year that you've started shipping to that is not in the top four but has the potential to be, say, by next year? Uh. Or are you focusing in. Eric. Okay. Eric, do we have any new customer in our projection for this fiscal year? We have one new customer in our projection, and this is a very big name. This is Adidas. We have confirmed one trial order with Adidas. Okay. This order is around 35,000 pieces. That is very small, right? Because this is a trial order. Okay. After that, the customer will give serious consideration to place the bulk order to Jerash next year. Okay. Okay, great. Thank you. Thank you. We have no further questions at this time. Mr. Choi, I would now like to turn the floor back over to you for closing comments. Okay. Thank you, operator. Thanks again to everyone for joining us today and for your support and interest in our company. We look forward to speaking with you again soon on our fiscal 2022 second quarter earnings call. Thank you very much. Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day. Thank you. Thank you. Thank you.