Power Integrations, Inc. Q4 2008 Earnings Call Transcript

Feb. 4.09 | About: Power Integrations, (POWI)

Power Integrations, Inc. (NASDAQ:POWI)

Q4 2008 Earnings Call

February 4, 2009 at 4:30 pm ET

Executives

Balu Balakrishnan - President and Chief Executive Officer

Bill Roeschlein - Chief Financial Officer and Corporate Secretary

Joe Shiffler - Director of Investor Relations and Corporate Communications

Analysts

Tore Svanberg - Thomas Wiesel Partners

Ross Seymore - Deutsche Bank Securities

Steven Smigie - Raymond James

Vernon Essi - Needham & Company, LLC

Auguste Richard - Piper Jaffray

Sumit Dhanda - Merrill Lynch

Christopher Longiaru - Sidoti & Company, LLC

Operator

Good day everyone and welcome to the fourth quarter and yearend 2008 financial results conference call for Power Integration. Today’s conference is being recorded. Now, at this time, it is my pleasure to turn the conference over to Mr. Joe Shiffler. Please go ahead, sir.

Joe Shiffler

Thank you, and good afternoon. I am Joe Shiffler, Director of IR and Corporate Communications for Power Integrations. With me today are Balu Balakrishnan, President and CEO of Power Integrations, and Bill Roeschlein, our CFO.

During today’s call we will make reference to financial measures that are not calculated according to Generally Accepted Accounting Principles. Please refer to today’s press release for an explanation of our reasons for using such non-GAAP measures as well as tables reconciling these measures to our GAAP results. Also our discussion today, including the Q&A session, will include forward-looking statements reflecting management’s current forecast of certain aspects of the Company’s future business. Forward-looking statements are denoted by such words as will, would, believe, should, expect, outlook, estimate, plan, anticipate, suggest, project, forecast, and similar expressions that look toward future events or performance.

Forward-looking statements are based on current information that is, by its nature, dynamic and subject to rapid and even abrupt changes. Our forward-looking statements are subject to risks and uncertainties, which may cause actual results to differ materially from those projected or implied in our statements. Such risks and uncertainties are discussed in today's press release and under the caption Item 1A, Risk Factors, in part 2 of our Form 10-Q filed on November 7, 2008.

Lastly this conference call is the property of Power Integrations, and any recording or rebroadcast of this conference call is expressly prohibited without the consent of Power Integrations.

With that, I will turn the call over to Balu.

Balu Balakrishnan

Thank you, Joe, and good afternoon. Obviously the impact of economic downturn is on everyone’s minds. So, I will begin with an update on recent trends.

As you may recall, we had already seen a significant slowdown in orders at the time of October conference call and projected that steeper fourth quarter revenue decline than many of our peers did at that time. That forecast proved accurate and revenues came in near the bit point of an original projection at $42.4 million, down 21% sequentially. With distributors and end customers reducing inventories, bookings declined at a faster rate than revenue. Compared to soft October bookings, orders dropped sharply in November before recovering slightly in December. In total, bookings for the quarter were down more than 50% from the third quarter.

As a result, we enter January with a backlog nearly 50% lower than the prior quarter. January bookings increased from December marking the second straight month of improvement but remained below October level. Forecasting of the first quarter revenue is exceptionally difficult due to the combination of lower backlog, the Asian holidays and the general uncertainty of the economic climate. Our expectation at this point is that our first quarter revenues will be between $32 million and $36 million and sequential decline of 15% to 25%.

We began the quarter with about 30% of our bookings needed to reach the midpoint of the range and including turns orders received thus far in the quarter; we have approximately 65% of the bookings we need to reach the midpoint. As we navigate this downturn, we are working to strike an appropriate balance between near-term profitability and longer term growth. Setting aside patent litigation cost, we have reduced our non-GAAP operating expense run rate by nearly $2 million per quarter since the second quarter of last year through a combination of headcount reductions and other cost saving measures. We are also taking steps in the production area including headcount reductions to mitigate the gross margin impact of lower production levels.

In total, we have reduced the size of the workforce by approximately 6% including deductions taken in Q4 and Q1. Lastly, we have total balance sheet to work returning a significant amount of cash to stockholders while reducing our share count, option overhang and stock compensation expenses. At the same time, we remained confident in the gross aspects of our business overtime and we are encouraged that design activity remains healthy despite the weak economy. The power supply industry is moving inevitably towards higher levels of integration and secular trend that Power Integrations has led since 1994 through a relentless focus on innovation.

While we continue to evaluate the balance between profitability and growth as economic conditions change, we believe that the continuing regiment in R&D and new products to support our future growth is the right thing for our business. In the fourth quarter, we introduced two products, LinkSwitch TV and Hyper PLC. LinkSwitch TV is an extension of our LinkSwitch-II products family targeting applications that require constant voltage but not constant cutting. This expands the range of applications in which we can offer the highly cost effective primary side regulation capabilities of LinkSwitch-II.

Hyper PLC is our first ever product for applications about 200 watt. The product integrates a resilient LLC power supply controller with power factor correction circuitry on a single chip and combines this with our high voltage driver chip in a single package providing a level of integration never before seen at such high power levels. This product targets high power application that we have not historically addressed including main power supply for flat panel TVs and ultra high efficiency desktop PCs and servers as well as high power LED streetlights and industrial controls.

Hyper PLC is the first of several products in our pipeline targeting applications over 200 watts. Once fully launched, we believe this high power products could increase our preferable market from approximately $1.6 billion to more than $2 billion. With respect to radio efficiency or other key growth drivers, there have been a number of developments since our last conference call. All were widely expected but it is worth to recapping them quickly here. On November 1st and January 1st respectively, Energy Star and European Code of Conduct both tightened their voluntarily specifications for external power supplies making them substantially tighter than the mandatory standards already in effect across the US. The mandatory European standard for the external power supplies is expected to receive final approval in the next several weeks and would be enforceable early next year.

Australia also adopted its mandatory external power supply standards effective December 1st, 2008 with New Zealand that is going to follow on April 1st, 2009. In November 2008, world's five largest mobile phone manufacturers introduced their joint rating scale for cell phone chargers, rating chargers from zero to five stars based on their level of lower consumption. The five star rating requires lower consumption of 30 mW or less, which is 94% below the mandatory limit imposed by the 2007 energy bill in the US and 90% below the threshold of Energy Star Version 2.0. This is a very challenging spec but one that we can meet quite comfortably with our LinkSwitch-II products.

Meanwhile, the European Union's new blanket standards for Standby received final approval in December and will take effect on January 1st, 2010. The standards mandate maximum Standby consumption of one watt for a wide range of electronic products with two watts allowed for devices containing a display. These limits are scheduled to be reduced by half three years after the standards take effect. A wide range of other standards are in development including work on television power usage at California Energy Commission setup box and energy light bulb specifications by Energy Star and standby limits in Canada, all of which were we are watching closely. It also increased by the new administration's commitment to energy efficiency as a solution to the nation's energy problem. While no specific proposals have been made regarding electronic products, the administrations energy policy explicitly recognizes that efficiency is the cheapest, cleanest, fastest energy source, something we have been saying for many years.

Before I turn the call over to Bill, I will give a quick update on the status of patent litigation with Fairchild Semiconductor where there have been a number of developments of late. As you may recall, we have previously won favorably a ruling determining that Fairchild willfully infringed four of our patent and that all four of our patents are valid and enforceable. In December, the court granted our request for a permanent injunction against more than hundreds of infringing Fairchild products. Although currently subject to a 90-day stay suspending action by the appeals court, we believe the injunction is having the desired effect. In fact we believe the infringing products had all largely been abandoned by Fairchild customers some time ago and Fairchild's claim it had ceased shipments of these products. Eliminating infringing products to the marketplace was the principle goal of our lawsuit and we are very pleased with this outcome.

The court also awarded us $6 million in monetary damages as well as interest on the damages owed. Our motion for enhanced damages and attorney's fees had been deferred pending the outcome of the new trial of any trial on the question of willful infringement, which should take later this year. The court's decision to order a new trial was expected in light of the 2007 Seagate decision which effectively changed the legal standard of proving willfulness. However, we believe that Fairchild's infringement was clearly willful under the revised standard.

The second case against Fairchild remains pending and has been scheduled for trial in the fall of 2010. We believe Fairchild continues to produce infringing products over and about the products covered by the injunction and in fact, we believe they continue to infringe two of the same patent they were found infringed in the earlier case. Separately, the US patent office is in the process of reexamining several of our patents at Fairchild's request, a common tactic now being used by the defendant in patent lawsuit. The reexamination process is ongoing and we are optimistic that our patents will ultimately emerge intact.

With that, I will turn it over to Bill for the review of the Q4 results. Bill?

Bill Roeschlein

Thanks, Balu, and good afternoon. Before I run through the fourth quarter results, I will touch on a few items that affected the quarter and will impact our financial model going forward.

First, as Balu mentioned, we are returning a considerable amount of cash to stockholders while reducing our share count and option overhang in the process. In the fourth quarter, we utilize $53 million to buyback 2.9 million shares of our stock or about 10% of total shares outstanding. We also paid a dividend of $2.05 per share on December 31st. For the full year, we bought back 4 million shares for $82 million. At December 31st, we had 27.5 million shares outstanding, down from 30.1 million at the end of 2007 with an average diluted share count for the fourth quarter with 29.8 million, down from 32.6 million for the third quarter. Expect our share count to fall further in the first quarter as the Q4 repurchases are fully reflected in the average and also reflecting continued buyback activity this quarter. At yearend, we had about $18 million remaining on our current repurchase authorization and we have used about 2/3 of that amount thus far in the first quarter.

Second, we executed a voluntary tender offer in December through which we purchase 2.4 million out of the money employee stock option for $9 million in cash. All of the options were purchased at prices below their current actual value. We believe these options offered limited retention value at a high cost in terms of option expense on the income statement. As a result of the tender offer, the compensation expenses that would have been recognized over the remaining vesting period of the tendered option were accelerated into the fourth quarter resulting in noncash charges of $19.3 million on our income statement. Including this charge, total stock-based compensation for the quarter was $22.9 million.

Going forward, starting with the first quarter, our quarterly stock compensation expenses will be about half of what they were in the third quarter of 2008, a savings of about $2 million per quarter. Also as the result of the tender offer, our option overhung was reduced by 30%, which should result in lower dilution down the road. There are two other nonrecurring items impacting our income statement for the fourth quarter, both reflecting the weakness of the current economic climate.

One is an impairment charge of $2 million for certain intangible asset which is excluded from our non-GAAP result. The other is an increase in our inventory reserve which is included in our non-GAAP result. This item reduced our non-GAAP gross margin by approximately 200 basis points and our non-GAAP EPS by $0.02 per share. Lastly, our non-GAAP effective tax rate for the quarter was higher than expected at 31.5% in order to bring our full-year rate up to 22.7%.

With that said, I will quickly review some of the financial metrics for the fourth quarter focusing primarily on non-GAAP results which exclude the accelerated option expense charges, other stock-based compensation expenses and the write down of intangible.

Revenues for the fourth quarter were $42.4 million, down 21% sequentially and 19% year-over-year. Full year revenues were $202 million, up 6% from 2007. This compares to 2% detraction in revenues for the analog semiconductor industry. The consumer end-market was the weakest performer in the fourth quarter, down almost 30% sequentially with significant weakness in both appliances and electronics. Industrial revenues declined in the mid 20s while computer revenues were down approximately 20% driven by weakness in desktop PCs.

The communication segment was a relative bright spot down by a low double-digit percentage driven by stronger than expected revenues from the cell phone charger market. The distribution channel accounted for 63% of revenues for the quarter while 37% came from direct sale. Channel inventory remained at 4.8 weeks exiting order, unchanged from the end of September although in dollar terms, inventories came down by about 25%. Avnet, our leading distributor, was our only 10% customer for the quarter accounting for 15% of total revenues.

Churns orders as the percentage of revenues were in the mid 50 and our average selling price was $0.32, down from $0.35 in the prior quarter primarily due to customer mix, most notably, the relative strength in the cell phone market compared to higher ASP market such as industrial. Non- GAAP gross margin was 49.9%, down 500 basis points sequentially, about 200 basis points of the decline was due to the increase inventory reserve. Of the remaining 300 basis points, roughly 2/3 came from changes in the revenue mix, specifically the relative weakness of the higher margin consumer and industrial market as compared to the lower margin cell phone market. The remainder of this sequential decrease, about 100 basis points, was the result of lower fix cost absorption due to the production cuts we implemented in the second half of the year.

As noted on our October call, we expect further gross margin pressure going forward from a combination of lower production levels and the stronger yen versus the dollar, plus an increasingly competitive pricing environment. As Balu mentioned, we are working to mitigate this effect through a variety of cost saving measures in the production area. This includes scaling back our in-house test operations which entails a significant reduction in headcount. Assuming no significant changes in mix, we are expecting a first quarter GAAP gross margin of 50%, plus or minus 100 basis points with a further decline of approximately 2 points in Q2 due largely to the impact of lower production levels and the stronger yen.

Non-GAAP gross margin should be about 50 basis points higher than the GAAP numbers. Non-GAAP operating expenses for the fourth quarter were $16.3 million, down $0.5 million from the prior quarter primarily reflecting the impact of expense reduction measures. This includes the elimination of a small number of non-production jobs in various areas of the Company, a 2-week companywide shutdown in December, a near freeze on hiring and a variety of other measures.

As Balu noted, we had taken nearly $2 million out of our quarterly non-GAAP expense run rate since the second quarter of 2008, setting aside patent litigation expenses allowing for seasonal fluctuations in operating expenses such as the resumption of payroll tax payment as well as a possible increase in the litigation expenses. We expect first quarter non-GAAP operating expenses to be similar to the fourth quarter. Stock-based compensation expenses should total about $2 million but in total operating expenses in the range of $18 million to $19 million. As mentioned earlier, our fourth quarter effective tax rate for the quarter was 31.5% on a non-GAAP basis. We expect our 2009 non-GAAP tax rate to be in the range of 25% to 30% due to changes in the geographical composition of our earnings mix.

Non-GAAP diluted EPS was $0.15 per share in the fourth quarter which again includes a $0.02 impact from the increased inventory reserve. We exited December with a $174 million in cash and short-term investments, down $51 million for the quarter reflecting the impact of the buyback. We had 28 days sales outstanding at December 31st, unchanged from the prior quarter, marking the seventh consecutive quarter of DSOs at 30 days or fewer.

Inventory on our balance sheet increased by $2.1 million and we stood at three inventory churns exiting the quarter. Assuming we hit the midpoint of our revenue projections, we would expect inventory dollars to level off in the first quarter and our aim is to return to the range of four to five churns within the next two to three quarters.

With that, I will turn it back over to Joe.

Joe Shiffler

Thanks, Bill. Since there are some other calls starting shortly, I would to ask everyone to limit themselves to one question first time around so we can get to as many people as possible to the top of the hour. We will be happy to come back for a second round as time permits. Operator, would you please give the Q&A instructions?

Question-and-Answer Session

Operator

(Operator instructions) Your first question comes from the line of Tore Svanberg - Thomas Wiesel Partners.

Tore Svanberg - Thomas Wiesel Partners

Balu, could you talk a little bit about your notebook adaptor business? I know that is a new business opportunity for you and it is probably quite a small percentage of revenue but as we walk throughout 2009, can you just talk about how you expect that business to run?

Balu Balakrishnan

Yes. We have several designs ongoing right now. They are all, I would say tier-two type of design and we are optimistic that we will get some revenue in the second half of 2009.

Tore Svanberg - Thomas Wiesel Partners

And Joe, can I do a quick follow up?

Joe Shiffler

Yes, go ahead.

Tore Svanberg - Thomas Wiesel Partners

With the test being outsourced more, what type of saving could that potentially gives you on a quarterly basis or has that saving already occurred?

Bill Roeschlein

We factored in the savings into the guidance that we gave on the call already.

Operator

Your next question comes from the line of Ross Seymore - Deutsche Bank Securities.

Ross Seymore - Deutsche Bank Securities

Could you clarify a bit on the ‘churns required’ commentary you gave and then how much you need as of today, I guess?

Joe Shiffler

Yes, Ross. This is Joe. The churns requirement for full quarter is just under 70% and the other comment we gave was that it includes the churns that we have gotten already were up to 65% booked to the midpoint of the guidance.

Operator

Your next question comes from the line of Steven Smigie - Raymond James.

Steven Smigie - Raymond James

So, I was hoping you guys could talk a little bit about how you think Chinese New Year has impacted orders here? How much shutdowns there may have affected standard ordering patterns and what you think maybe will start to happen next week and the following weeks as we get pass that?

Balu Balakrishnan

Well, the Chinese New Year was the last week of January and as we normally expect, there was very little in terms of bookings from Asia and of course, this week, we are out of the Chinese New Year and we have seen the bookings pick up. So, we have passed that.

Steven Smigie - Raymond James

Okay because my understanding was there were a lot of shutdowns that were still going to be in place this week and it is really next week that you can see probably the full force of orders coming back.

Balu Balakrishnan

Well, there are only a couple of days this week but if I look at those today, we think it will come back to the type of bookings we had before the Chinese New Year.

Operator

Your next question comes from the line of Vernon Essi - Needham & Company, LLC.

Vernon Essi - Needham & Company, LLC

Just a question on the balance sheet, I do not know if you clarified this at all, Bill but there is a new item there on note receivable. Could you discuss that?

Bill Roeschlein

Sure. That is the re-class from long term to short term of VMD or X-FAB note receivable which has been on our balance sheet now for a couple of years.

Operator

Your next question comes from the line of Auguste Richard - Piper Jaffray.

Auguste Richard - Piper Jaffray

Just to get a better handle on the gross margins over the next couple of quarters, it looks like they will come down about 300 basis points this quarter and then a couple of hundred more next. Could you just talk again about the yen increased pricing pressure and other effects under absorption and the magnitude of each in those two quarters?

Balu Balakrishnan

Sure. The yen, as most of you know, a 10 yen change has approximately one point impact, 100 basis impact on the gross margin and as far as the production levels going down, we estimated that that is going to be two points but it take some time to move through the inventory and so you will see a little bit of it this quarter and you will see the full impact next quarter because of the flows through the inventory.

Auguste Richard - Piper Jaffray

Got it and the under absorption..? Oh, I am sorry, you have that and then just little quickly, litigation expenses, is that going to be something that is going to be flat going forward or is there going to be, how should we think about those expenses?

Balu Balakrishnan

Well, that is the hardest one for us to estimate. The best we can come up is approximately $6 million for the year and we have said that $1 million to $1.5 million in the first quarter and that is going to fluctuate quite a bit from quarter to quarter.

Operator

Your next question comes from the line of Sumit Dhanda - Merrill Lynch.

Sumit Dhanda - Merrill Lynch

Balu or Bill, a quick clarification as it relates to the relative impact of the lower production versus the stronger yen. On the yen front, is the full impact of the 89 yen to a dollar reflected by Q2 given the lag between the strengthening of the yen versus the impact on your actual cost line? Is it fair to assume that the bulk of the impact in Q2 is production related versus the stronger yen?

Bill Roeschlein

Well the bulk of the yen should be fully reflected by June to be sure but that would imply that there could be some spillover into Q3 because as we are now paying 89 yen here in December, it will probably take six months to have sell-through on that. So, I would see it being a Q2 or Q3 issue.

Sumit Dhanda - Merrill Lynch

And as the impact, the two point decline in Q2, how does it breakout between lower production and stronger yen?

Bill Roeschlein

It is more the yen is probably 1.5 and 0.5 production. We are seeing the impact of lower production levels sooner and we are going to see the impact of the yen so bookings, we have already seen that impact on production but booked much a lot of it.

Operator

Your next question comes from the line of Christopher Longiaru - Sidoti & Company, LLC.

Christopher Longiaru - Sidoti & Company, LLC

My question is about, just talking about scaling back the in-house test and the reduction of headcount. Has that started yet or has that been done or is that something you are planning to do and what is the impact of that?

Balu Balakrishnan

It has been done and so we expect that it is going to be reflected in the current quarter, the severance related to that and we take that into our guidance that we gave you for the next couple of quarters.

Christopher Longiaru - Sidoti & Company, LLC

Okay and then only, I think, can you give the share count for the next quarter, if you could?

Bill Roeschlein

The share count should be about 28 million shares…

Christopher Longiaru - Sidoti & Company, LLC

Diluted basis.

Bill Roeschlein

On a diluted basis. When everything is said and done, the average is, it should average down to about 27 for the year though.

Operator

(Operator's instruction) You have a follow up question from the line of Ross Seymore - Deutsche Bank Securities.

Ross Seymore - Deutsche Bank Securities

Have you seen any changes in the pricing environment outside of the mix implications you talked about in your kind of spot ASP in the quarter?

Balu Balakrishnan

Yes, we are definitely seeing a pricing pressure because of the slowdown and we were expecting that and we are reacting to that as we speak.

Ross Seymore - Deutsche Bank Securities

And you did not really mention the ASPs as part of the gross margin pressure, is that something that could be incremental to that or is that already included in your guidance?

Balu Balakrishnan

Well the ASP reduction in Q4 was primarily due to the mix change because of the cell phones that were unexpectedly stronger relative to other market. But going forward, there will be impact due to pricing pressure but historically, we have been able to offset that by cost reductions. So we are doing cost reductions. So, the guidance we gave you is a combination of all of those things as the cost reduction that we would last to some of the impact of the pricing pressure, the lower production and yen exchange rate.

Ross Seymore - Deutsche Bank Securities

One quick follow up. That cell phone business doing stronger than you expected, what caused that?

Balu Balakrishnan

Well, two of our large OEMs did better than we thought. One of them was ramping up. We knew that they were ramping up but they ramped up to much higher levels that we expected. We are not quite sure whether that is going to be a run rate issue or it is just a one quarter benefit. The other OEM also did better than we expected. They actually grew slightly from Q3.

Operator

You have a follow up question from the line of Tore Svanberg - Thomas Wiesel Partners.

Tore Svanberg - Thomas Wiesel Partners

Yes, Balu, just a follow up on the joint rating scale for the top handset manufacturers that was announced, has that already started to have an impact on your design activity?

Balu Balakrishnan

It is definitely impacting our design activity. It obviously has had an impact on revenue. We have at least two of our largest, actually, two of our largest OEMs in cell phone asking for the five stars back on their new design.

Tore Svanberg - Thomas Wiesel Partners

Okay then lastly on the new PLC product, I think you mentioned revenues in 2010 but could start to see already some revenues here in 2009, second half maybe?

Balu Balakrishnan

We may get very slight revenue in the fourth quarter maybe but really it will not be material.

Operator

You have a follow up question from the line of Auguste Richard - Piper Jaffray.

Auguste Richard - Piper Jaffray

Again in looking at past Chinese New Year, do you have any sense as to whether production rate will start up? Have you gotten any indications from your customers?

Balu Balakrishnan

I do not think we have much of a visibility. What we do see is that a pick up of the bookings since the beginning of this year. It is still on a strong, January was not as strong as October but as you can remember, we lost almost one full week in January to the Asian holiday. So it is hard to do the comparison. So, February will really tell us whether the pick up has, if it is real essentially and as I said, we only have couple of days in February and if they have come back to levels of booking that we saw in January but that is only two or three days. That is very hard to tell whether that is the trend.

Auguste Richard - Piper Jaffray

Okay and if you have a full January, would that be similar to October?

Bill Roeschlein

Bookings had continued for that off week with similar rate to previous weeks that probably would have been in the ball park of October.

Operator

You have a follow up question from the line of Sumit Dhanda - Merrill Lynch.

Sumit Dhanda - Merrill Lynch

Balu, just a clarification on what you said about backlog entering the quarter and where you are in terms of how much you have booked versus the midpoint of guidance, so you enter 30% booked within a month or so or five weeks, 65% booked. If you sustain this trajectory, does this imply that you are really ahead of plan or am I misinterpreting what you are saying here?

Balu Balakrishnan

Well, we have to remember that bookings in January almost entirely within the quarter. The bookings in February will be partly in the quarter and partly in the next quarter. So, we are taking all of those into account when we gave you the guidance of $32 million to $36 million. Of course there is a lot of uncertainty. We just do not know how February and March will turn out. Can it be better than that? Yes. Can it be worse than that? Yes. This is the best guidance we have given all the data we have.

Sumit Dhanda - Merrill Lynch

Okay and then any update on incremental share recapture at Samsung or had that reached the status quo at this point?

Balu Balakrishnan

That is a good question. We think that our customer will supply its chargers to Samsung. That is larger share than they were anticipating in the fourth quarter. We do not know whether that is a permanent share gain or it is just that that quarter, they were able to get more share and we will know better by the end of this quarter but that will continue and I would say that to best we can estimate at this time, the share is in the 30% to 40%. If Q4 is the actual run rate, it will be in the 30% to 40%.

Operator

And that does conclude our question-and-answer session. This time, I would like to turn conference back over to you Mr. Shiffler for any additional or closing remarks.

Joe Shiffler

Okay, thank you. That concludes the call. There will be a webcast replay of the call available on the Investor Info section of our website which is Investors.PowerInt.com. Thanks for listening and good afternoon.

Operator

That does conclude today's conference. Thank you for your participation. You may disconnect at this time.

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