Well, good afternoon. Thank you all for joining us. This is day 3 of our 24th Annual Oppenheimer Consumer Growth and E-Commerce Conference. My name is Brian Nagel. I work at Oppenheimer as the Senior Equity Research Analyst covering consumer growth and e-commerce. So again, thank you all for joining us. So I'm very pleased to have with us our next presenting company, Motorcar Parts of America, it's MPAA, and the company's chairman, president, and CEO, Selwyn Joffe. So Selwyn, thank you for joining us again. Thank you so much, Brian. Appreciate you inviting us. So we'll, Selwyn and I will structure this as an informal fireside chat. I'll ask questions, and Selwyn will provide answers. I mean, to the extent there are questions from the audience, just please send them through the chat, and we'll work them into our conversation. So Selwyn, I thought, you know, just for the, I mean, for the group here, that some may be less familiar or unfamiliar with the business of Motorcar Parts of America, maybe you could just describe your business, you know, kinda how you and your company basically fit into the broader auto and auto parts landscape. Yeah. So essentially, thanks, Brian. We're a supplier of non-discretionary hard parts for the automotive aftermarket. When I say automotive, I mean, we go all the way from light duty to heavy duty and rotating electrical. And in the brake line, we go all the way through to medium duty. So again, that sort of begs the question, we're in alternators and starters, which we call rotating electrical, which is our legacy product we've had for a number of years, still represents a big portion of our revenue. And then we're also in the non-discretionary full brake parts distribution business, so, and production business, and that's a lot of our growth is coming from the new brake programs. We have some diagnostics that go around, but along with it, that's exciting to, you know, that's exciting and a lot of, a lot of opportunity evolving there, but the main product is non-discretionary, hard parts we sell in the North American marketplace historically. We've recently launched into Mexico with huge success, and it's sort of indicating that not only do we have this $multi-billion-dollar opportunity in the United States and Canada, but we have a global opportunity as well now. Our products are well accepted, and as our customers expand internationally, so are we. And, through the Mexican expansion and the footprint of our product, our, our factories around the world, you know, we, we have a huge sustainable growth path for decades to come, just in the product lines we have, besides more product line opportunities. From a distribution standpoint, who are you, I guess, how do you get to market? Who are your key partners? Yeah. So the key, key distributors or key would be the retailers, would be the, the largest part of our business. We also have our own brands, which are fast evolving in the professional installer markets, all the WDs. We sell under the brand name Quality-Built, and that Quality-Built is experiencing exponential growth in the brand names, in its, you know, in our Quality-Built program, and you'll see it, you know, all through the professional installer aftermarket. That's not sold through retailers, that's sold only through the WD channel. So you, you and your company reported a fiscal fourth quarter, the March results yesterday, and hosted a conference call yesterday afternoon. So again, and maybe for the sake of those who are still digesting the results or haven't yet gone through the results, maybe just talk about, you know, what, what you, what you view as the key takeaways from this recent report? Yeah, I think, I think the, the key is that, you know, strong growth still. We've had a, we had a great year. I mean, probably the most significant item in the results is the large positive cash flow we generated. We generated $39 million of positive cash. We paid down $35 million of debt, and, you know, our cash conversion rate is on an adjusted EBITDA basis, in the 40%-47%. And if you don't adjust to the cash conversion rate, and EBITDA is even higher, we expect that to continue. Our total liquidity is very strong, and on our net debt balance, we only have a little over $100 million in debt. With the cash generation, you know, we think there's a big opportunity to pay off the debt or to allocate capital to other things. That's very significant. The top line continues to grow. We had some softness in one product line that relates to a transition in our Wheel Hub business, and that's coming right back. So, you know, had we had a normalized Wheel Hub fourth quarter sales, we would have blown through what was an all-time record comp quarter for last quarter. So, strong there. The other side of it is that as the brake lines are evolving, I mean, there's significant margin accretion coming with the brake lines, and that's where we've had headwinds on margin. Our margin on our legacy products continues to be very strong. So, you know, seeing a lot of tailwinds on the margin side. So, and then last, not lastly, but, the working capital neutralization that we're working on is pretty significant. I mean, we've now got over $120 million of purchases signed up for our supply chain financing program. And so the net effect of that is generating, you know, approximately $20 million of working capital, hopefully converting that to cash as well. And so significant opportunity in neutralizing working capital for our growth. And that's a big, you know, that's a big challenge for some of the aftermarket companies. So we're, we feel like, we've extended days outstanding by a net 30 on all payables. You know, there's an opportunity to go much, much, much further on that, but it's been very successful in its first year, and we'll see that, the benefits of that this year as well. And so, you know, you look at big revenue upside, margin accretion, significant cash flow, and then you look at the metrics of what we're trading at, you know, we're trading at, you know, 30% of book value, which, our market cap, is 30% of book value. Our debt levels are, you know, anywhere between 1.5 and 2.25, depending on how you look at our EBITDA, and debts are very low, low debt levels for my own debt. Enterprise to EBITDA, EBITDA ratio is 2.4 times. So just our metrics, we feel, there's an exciting, exciting time and investment opportunity here. On top of that, we're, you know, our ESG, we've got a great new board member, our governance is being enhanced all the time, and our environmental footprint is fantastic. I mean, we're a remanufacturer of, for the future. And, you know, so I think that there's a lot of tailwinds in our business. I'm rushing through this, Brian, but 'cause I don't wanna take up the whole time on, you know, just touting ourselves. But, you know, there's a lot of, there's a lot of big growth, sustainable growth, sustainable profitability, sustainable cash flow, you know, for the long term, and we expect to be part of that, and, and we're excited. So, what I'm gonna on that point, you know, one of the key points you just made there. I mean, what you're saying is that, you know, from your perspective, and I'm thinking from others as well, you know, there's a massive disconnect right now between the fundamentals and then where the markets are, say, valuing your stock. Yeah And the company. You're talking to investors. I know you, you've been in our conference here for the day. What are investors missing? I mean, can you, well, from your standpoint, what are investors missing? Is, and you can glean that from these conversations. Well, I think the key thing that investors were looking for is positive cash. And so when you launch into these product lines, we had... You know, we were burning cash over the last couple of years, so if you look at the trail of how positive cash flow has been, it's tremendous. I mean, we've had negative, negative, and now this big positive. We're through the big inflection point of investing in the category, and so I don't think people are understanding it. And the working capital situation as well, as we, you know, as we make this progress in neutralizing working capital and generating cash, you know, you've got to remember, we've got just a little bit over $100 million. We could pay down debt in a very short period of time, and so I think they're missing that. I think there's further opportunity for price increases, and I think that we're entitled to them. I know that the retailers and everybody will push back on that. But, you know, interest rates, if as interest rates come down, the cost of the supply chain factoring program goes down as well. We saw some good news this morning, I think, on some inflation data that came out. I think that, with Chinese tariffs coming in the future, that the Chinese will devalue, will try and devalue their currency, and I think the U.S. is gonna have to respond accordingly as well, which I think will also put further downward pressure on interest rates, to be honest with you. I mean, and so we see tailwinds coming from a reduction in interest rates, even though people, it seems to be taking a lot longer than most people had hoped for. But. And on top of that, so you neutralize interest rates, I mean, our earnings power just goes up exponentially, and on top of that, we're neutralizing it based on our working capital initiatives. The inventory build that we've had to get into the new brake product line has been pretty significant, but now we've done that, and now we're capturing share. And as that goes on, those inventory levels, there's tailwinds in the cash coming from those inventories as we go forward as well. And so, yeah, I just think people are missing the forest from the trees in terms of, in terms of the opportunity for the, for the aftermarket and for our company in particular. So from your- Yeah, sorry about that. No, sorry, I didn't mean to interrupt. Go ahead. No, no, no, I just, I'm hoping I'm being responsive to your, to your question. Definitely. Mm-hmm. So, I mean, again, maybe not a totally fair question, but, you know, you mentioned with the cash flow now, you could pay down debt. I I mean, as you're looking at this disconnect, you know, what are some of the other, you know, the other opportunities that are presented to you and the management team as far as this, you know, capitalize on, so to say? Well, we've got a big repurchase that's already in place. I mean, there's an opportunity to look at buying back the stock. I mean, that's the other side of the allocation of capital. Those are sort of the two immediate ones. So, we'll, you know, we'll have to wait and see how that unfolds. Just one more question, then I'm gonna jump more back, bigger picture. But how, from a cash perspective, we're talking about the improving cash flow generation of the company, you know, what type of capital do you need to run the business, and where are the, basically, where are the capital needs going forward? Well, we've invested in all the infrastructure. So, you know, we started this greenfield brake program. I mean, we're now in the top three largest suppliers of brakes and particular calipers in the U.S., and we've spent all that money. We've spent all the money ramping up the inventory. We've spent all the money starting new factories for direct shipments straight from Malaysia into the United States. We've spent all the money enabling us to grow into the Mexico market directly from our Mexico facilities, and so, you know, the ability to go through Central America all the way down to South America with our existing footprint is significant. We've got the infrastructure to go into Southeast Asia with our footprint already. We've got India and Malaysia built out already, ready to go, and we're picking up share in the U.S. So, you know, we've done a lot of the heavy lifting. It's cost us a lot of money, and it's taken a little longer. We had COVID, and we had a weaker customer, a large customer that was weaker than we would have hoped for, but we're through that right now. Let's hope those, you know, there's nothing unforeseen. I don't see it, but I think the runway for us right now is looking very positive, and we're a great supplier. I mean, the most important thing to remember is the customers enjoy our products. We've shipped 95%-100% fill rates. We're coming out of the world-class state-of-the-art facilities. If people come and see our factories, I've never had anyone say that this is perhaps the best factories they've ever seen in their lives. And that starts with OE suppliers all the way down to the aftermarket purchasers. And our field service teams are the best in the industry. We get, you know, credit for that all the time. We have great cataloging programs. We have the, some of the best quality control systems in the industry, and, you know, we're launching now a significant number of new parts. We've been a little bit slow on the new part introduction. We accelerated that dramatically. And so... You know, we're optimistic about our outlook. I mean, it's not reflected in our stock price yet, but we're very optimistic about our outlook. Mm-hmm. We've given some conservative guidance as well, Brian. I mean, 'cause the market has been softer, but the fundamentals of the market, there's still 280-something million cars, 12.6 average age. They're all gonna need- all of our products will be needed in all of these cars. So- Yes, let me ask, maybe that's a good segment for one of the bigger picture questions I have. Just, you know, and I've been talking with them over the last few days, talking with a number of companies across retail, across consumer. You know, there's different views out there of the health of the consumer, you know, from different perspectives. So the question I'll ask you is, I mean, given your perspective, you know, in your business, how do you view the health of the consumer at this point? And how does that play into your business? Well, look, I think the consumer's delaying replacing their parts. I mean, because that, you know, discretionary income I think is a little more valuable, you know, a little more scarce for the consumer. I think the consumer's a lot more sensitive. When it comes to our parts, I mean, they're non-discretionary, so they're gonna replace them. They may choose for a less expensive part, but we play in all the categories there. But what's less expensive is going to the aftermarket channel through the WD, as opposed through the dealer network. And so they're downgrading from an OE part into an aftermarket part, which should play right into, you know, into our hands and into the mass distribution channels of the aftermarket. But we're non-discretionary, so at the end of the day, what's important for the consumer is they've gotta get to work, they've gotta be able to buy groceries, they've gotta be able to take the kids to school. They need to take that summer vacation. They're gonna downgrade from an expensive airline flight to driving their vehicles. Miles driven, we're seeing, is ticking up. And so, you know, at the end of the day, I think it's all good for us. I mean, you know, I think the market is fine for us. And I guess another, you know... As you know, I follow closely the auto aftermarket auto parts- Yeah ... retailer for your customers. One thing we're talking a lot about is just the, you know, to the extent to which cars on the road are getting older. Yeah. You know, and so, look, they're built to go longer now. They drive longer, but as that happens, they require more maintenance over time. So you've gotta be a great play on that as well, right? Absolutely. I mean, the better the car is, the better it is for... People say, "Oh, the cars are made great, it's bad for you." It's the opposite. The cars are made great, it's wonderful for us, because you're not scrapping your car because it needs a new alternator. And so if the car is gonna, you know, if it just takes replacing the alternator and you can still drive that car, you're gonna get more than one replacement in the life of the vehicle. And so that's great. Then you look at, there's 96% of all the vehicles on the road are still combustion engine vehicles, and the average age continues to go up. So we've got so much tailwind and so much opportunity over the next 20-30 years, as a sustainable growth rate. We have the international markets, we have additional share in the North American markets that we're in already. We've got a footprint that's set up for growth everywhere. We've got margin accretion coming in, new products that we've launched. We've been through the toughest part of that, and we're hoping that we have deflation in interest rates. I mean, whether we do or not, if we have deflation in interest rates, that's immediate, immediate benefit to our bottom line. The tax situation, I mean, we, we've got a massive accretion because we took that provision, that allowance with the tax valuation. As we drive into more profitability each year, that'll all come back onto the balance sheet as well. So your stockholders' equity is gonna be accelerated dramatically, so the ratios even get more exciting. So yeah, so I think, again, forgetting about next quarter, but you look at the outlook for where we are today, this company is in a good position. Lots of liquidity to enable us to get to where we need to get to, too. We don't, we don't need any external capital. I mean, I'll ask the question, so who's your competition? But then also maybe broadly, you know, how do you consider competition? And if you can maybe talk about it in terms of, you know, where you are with these key distribution partners, or even by, you know, the specific parts and products you have. Yeah. So I think in rotating electrical, our main competitor is BB B, and they're a good company, I mean, they're a good competitor. They have the other lion's share of the marketplace. There are other smaller competitors that are out there, but we generally do dominate the industry. And then in the brakes, there's really three players that on the brake caliper side, and again, BB B, one of them, and, you know, First Brands and maybe a couple of smaller ones. But really the three of us sort of dominate the U.S. market there. In wheel hubs and bearings, I mean, that's a much broader market. I mean, you've got a lot of Chinese players that play there. There're not too many that have full line capabilities like ours. Now, with our own factories where we're producing, we're outside of China, which is, you know, customers don't have to rely on a source of China where they've got the tariff. We can supply the full program out of Malaysia, out of our own factory, so it's trustworthy, the quality is easily identifiable. There are no games being played in terms of, you know, country of origin, and so I think we have a competitive opportunity there against some of the Chinese players. And you know, the pads and rotors is a far more competitive arena, but in our brake pad program, we were able to get Centric which dominated the high-end aftermarket brake pad, and we were able... They sold the company, and the company that acquired them decided not to use their spec in the, in the Centric box. I mean, they went to a different spec, and we acquired the exclusive rights for that spec on a very established formulation for pads. And it's scientific, it can be tested, and you can see what it's about. And, you know, we've got that, and I think that spec gives us a competitive advantage over the rest of the market, and the installer trusts it. They've known. They've used it before. It's now under a different name than what it used to be, and it's all under the Quality-Built Braking name. So there's a huge competitive advantage just in the quality of the product there. And so we, you know, we feel like we have growth opportunities coming at us from all, all sides. On top of that, the diagnostic business for alternators and starters is now, with the EV market soft, the demand has gone through, you know, huge amounts of increase in our demand. We mentioned yesterday we will sell over $100 million of testing equipment in the alternator and starter space over the next three years. And you know that's good margin business, by the way, on top of it all, and good cash flow. So how do you think about it? And, you know, you know, we talked a bit here, I know, and historically, we've talked about just, you know, as you're building out this, this product portfolio. I mean, how, how do you, how do you think about just the kind of interplay between some of the legacy products and then some of these, these, these newer products? Look, the legacy products are relatively stable in the North American marketplace. As you get into... And I mean U.S. and Canada, when I say North America, that's probably not that accurate. But as you get into Mexico, we've seen growth in all of our products, including legacy. Opportunity for legacy to grow throughout the world, I mean, there's a massive market throughout the world, 3-4 times larger than the US in total, so we'll see continual growth there. I think we'll see continual share growth in the legacy products as well. Margins are stable in that business, and, you know, it continues to be stable. Fill rates and capabilities there are second to none, you know, excellent. I mean, they're phenomenal. The brake category is a little different. I mean, it's evolving. We're now over, you know, 50% capacity in our factories, so all of a sudden, your overhead absorption is starting to change. We've had headwinds on the margins out of the brake product lines, and, you know, that's gonna change. And so you're gonna see accretion in sales and growth in those businesses, as well as margin accretion. And, we're excited. We've got, we've got commitments with a new business that'll start, you know, in December, January timeframe, and, and in the meantime, we're, you know, we're, we're experiencing some efficiencies. And, and so, you know, I think that has enormous opportunity for growth just in the local markets and on the international markets. And we wanna focus just on those because with the cash flow metric, where we're generating cash and growing those product lines, we can grow the top line, we can grow the bottom line, and we can generate cash and pay down debt or utilize it, buying back stock or whatever, whatever allocation of capital we decide to do. So as you look at international, you mentioned Mexico a few times here. So before MPAA, you know, pushed more aggressive, pushed into Mexico, where were the... Who was servicing that market? That's a good question. There's a lot of local... You know, I—when I started in this industry, there were 85 manufacturers, alternators, and starters in the U.S. And I think today there may be, I'm, I don't wanna be insulting to anyone, but there may be 3-4. I'm not sure. But, and forgive me to some that may be small that I'm not knowing, but very few. In Mexico, it's the same thing. What happens in a market that's evolving, a third-world type market, the repair is happening by the mechanic, so they are rebuilding the alternator. And then, as more disposable income comes into the marketplace, instead of rebuilding that alternator themselves, they'll go to an AutoZone, O' Riley, whoever's in that marketplace, and they will buy a replacement remanufactured item. So the repairs, the type of repair changes. So it's not so much that there are 1 million factories, it's that everyone's, the mechanic has to rebuild the alternator themselves, and now they have the option not to do that. I see. That's- That's why there's enormous growth in that. Yeah. That's interesting. Yeah. So our time's running down here, so is there anything that we haven't discussed that we should discuss here? You know, I don't know. I've done a lot of pitching here, so I'm not sure. But you can obviously tell my enthusiasm for where we are as an entity, and my disappointment in the valuation of the company. But overall, I would say is I'm thankful to a great team of people that we work with, and I'm very thankful to a great group of customers that are extremely happy with us right now. So I see, again, more and more opportunities. And again, Brian, thank you for including us, and I know you have a great conference, and your knowledge base in this space is enormous, so we're very respectful of being part of your conference. Well, we appreciate you. It's been many years you've attended us, so thank you. Yeah. Thanks. Yep. Excellent. Anything more. Thank you so much. Any questions? I guess we- No, there nothing came through. Okay. All right. Thanks so much.