Rudolph Technologies, Inc. (NASDAQ:RTEC)
Q2 2016 Earnings Conference Call
July 28, 2016 04:30 PM ET
Bob Koch - VP, General Counsel
Michael Plisinski - CEO
Steven Roth - SVP, Finance and Administration, and CFO
Patrick Ho - Stifel
Tom Diffely - D. A. Davidson
Farhan Ahmad - Credit Suisse
David Duley - Steelhead Securities
Good day and welcome to the Rudolph Technologies’ Second Quarter Earnings Release Conference Call. Today’s conference is being recorded. At this time I would like to turn the conference over to Bob Koch, Vice President and General Counsel. Please go ahead, sir.
Thank you, Lauren, and good afternoon, everyone. Rudolph issued its 2016 second quarter financial results release this afternoon shortly after the close. If you’ve not received the copy of the release, please refer to the company’s website at www.rudolphtech.com, where a copy of the release is posted.
Joining us on the call today are Michael Plisinski, Chief Executive Officer; and Steven Roth, Chief Financial Officer.
As is always the case, I need to remind you of the Safe Harbor regulations. Any matters today that are not historical facts, particularly, comments regarding the company’s future plans, objectives, forecasts and expected performance, consist of forward-looking statements within the meanings of the Private Securities Litigation Reform Act of 1995. Such estimates, whether expressed or implied, are being made based on currently available information and the company’s best judgment at this time. Within these is a wide range of assumptions that the company believes to be reasonable. However, it must be recognized that the statements are subject to a range of uncertainties that can cause the actual results to vary materially.
Thus, the company cautions that these statements are no guarantees of future performance. Risk factors that may impact Rudolph's results are described in the company's latest Form 10-K as well as other periodic filings with the SEC. Rudolph Technologies does not update forward-looking statements and expressly disclaims any obligation to do so.
Today’s discussion of our financial results will be presented on a non-GAAP financial basis unless otherwise specified. A detailed reconciliation between GAAP and non-GAAP results can be found in today’s earnings release.
I will now turn the call over to Mike Plisinski. Mike, please go ahead.
Thank you, Bob. Good afternoon, everyone and thank you for joining us this afternoon. I’ll begin by reviewing business and operational highlights for the second quarter, after which I’ll discuss market dynamics and our guidance for the third quarter. Following my remarks, Steve will review our financials in detail, and then we’ll open the phone lines for your questions.
As highlighted in our earnings release today, the Rudolph team once again delivered strong financial results for the quarter. Revenue increased 15% to $62.7 million, a quarterly record, and was at the high-end of our guidance. Leading that growth our lithography business had a record quarter in which we ship both the display tool as well as a repeat order to increase fan out wafer Level packaging capacity for an existing customer.
Our display tool was selected to provide lithography for next generation AMOLED devices and is quickly moving through process qualification. In addition, our software sales were near record levels with continued strength in tool-centric sales driven by the accelerated adoption of over TrueADC solution, which is providing significant value in advanced packaging. Driven by the need to achieve superior quality and device reliability, our customers are adopting Rudolph’s integrated process control solutions for applications such as RDL control and bond pad inspection, where the amount of data generated can overwhelm operators and mistakes impacting yield can occur.
Our customers and their customers see Rudolph software as an important capability to address this issue and enable a greater level of quality for manufacturing lines utilizing Rudolph’s integrated inspection and software solutions.
In addition to our growth and revenue, we saw excellent flow through to the bottom-line with operating income increasing by 60%, and positive operating cash flow representing 19% of sales. Our gross margins remained strong at 55%, driven by the strong software sales and increase value of our integrated solutions.
Steve will discuss the financials in greater detail, but before turning to him, let’s spend a moment on the business conditions.
We’ll start with our largest market driver for the quarter advanced packaging, which included contributions from all business groups. Though we serve multiple advanced packaging applications, we continue to see the greatest expansion occurring in fan-out wafer level packaging. This expansion is being driven by the migration to smaller dye with higher IOs and the need for greater package efficiency, especially for mobile applications.
Underscoring that expansion, during the quarter we received a multisystem order totaling over $11 million from a leading OSAT, primarily to meet the growing demand for fan-out wafer level packaging services to their customers. This order is comprised of Rudolph’s unique integrated solution, which consist of multiple process control systems enhanced by both Discover and TrueADC software products.
A comprehensive solution will be broadly deployed into multiple areas within this customer’s manufacturing process, including whole wafer inspection, 3D bump metrology and post saw dye inspection. This type of solution helps leading fan-out manufacturers to ramp more quickly and provide higher-quality devices. The first system shipped for this order included our new 3D metrology option on our NSX platform. This tool shipped in the second quarter with the remaining of the order set to ship the second half of 2016.
Our newly launched combination 2D inspection and 3D metrology tool continues to gain traction in the marketplace and we added over $2 million in additional sales over the $5 million we announced in Q1. To put this new product growth into perspective, our revenue for system supporting 3D technology in the first half of 2016 is already more than double our 3D revenue in all of 2015. Demand for these systems will continue to grow our customers increase focus on quality and not only cost.
For example, Rudolph was selected in a recent competitive run off by a large IDM based on the quality of our measurements which is especially critical in application such as copper pillar height measurement where the accuracy and repeatability of the measurements is a direct correlation to yields. We expect to ship this system in Q3 with follow on orders in late 2016 or early 2017.
Looking ahead we are excited about the potential for new applications with our patented clear fine technology which we also announced this month. This technology can detect residue defects that are difficult to impossible to see with conventional imaging techniques. These defects are often the root cause of very costly field failures, which can occur when dye interconnects have weaker bonds and then are exposed to operating conditions for extended periods of time.
We’ve been actively collaborating with several key customers to understand this inspection challenge and how this new technology addresses it. We plan to incorporate Clearfind technology in our latest defect inspection system for advanced packaging and frontend applications in the second half of 2016. Clearfind will provide our customers with the ability for early detection of process and manufacturing related issues resulting in significant reliability improvements.
These new capabilities integrated 2D inspection with 3D metrology, our Clearfind technology and other programs in our pipeline are part of the Rudolph team’s focus on increasing the cadence of our new product releases and doing so while maintaining the high standards of quality that our customers have come to expect from Rudolph. We’re encouraged by the initial reaction to these new products and we are confident they will enable us to generate new value added solutions, which should result in future market share gains.
Specific to our lithography business, recently a third party semiconductor equipment market researcher cited advanced semiconductor package lithography growing 18% or 4x faster than IC Lithography. Lithography tools are used to patterning advanced packages such a fan out wafer level packaging, fan-in, wafer level chip scale packaging, flip chip in 2.5 and 3D packaging.
Rudolph continues to make process in this market both by engaging new customers as well as expanding to other applications at existing customers. We see the utilization of our tools in the field continuing to increase, which we expect will lead to additional business late in the year. Finally as previously announced we’re on track to ship a JetStep S system to a new JetStep customer for a panel level packaging in Taiwan in the third quarter.
We’re encouraged by the heightened level of interest in panel level packaging and we are actively running samples for multiple customers considering this investment. This level of flexibility to handle multiple applications from flip chip to fan out and from wafer to panel and to display underscores the JetStep systems’ versatility to handle a variety of applications at a compelling cost of ownership and with an increased process latitude. This process latitude is important to ensure higher yields at volume production levels.
Though our sales cycle remains long, we recognized that the selection of a lithography solution is a critical decision for our customers and the time we spend to educate the customer base about our advantages and the process latitude our tool can provide is resulting in steady annual growth, even as our quarterly growth remains lumpy.
In summary, advanced packaging is driving revenue across all business units and we expect that to continue into the next several quarters as customers ramp to meet increased demand for mobile devices heading into the holiday season. Apple and Qualcomm appear to have gotten through their pauses and we see our customers ramping to meet expected demand. For Rudolph this should drive not just our advanced packaging customers but also our RF Filter and MEMS customers.
Wireless communication continues to expand into all manner of device and these devices are communicating on increasing numbers of frequencies driving more filter content per device. We see existing customers expanding their product portfolios and new players entering the space most recently evidence by Infineon’s acquisition of Wolfspeed for next-generation filter applications.
After a digestion period in Q1 we saw revenue from RF filter customers increased dramatically in Q2, representing just under 10% of our revenue. We see investments from this market continuing in the second half of 2016 and we expect to add another top five filter manufacturer during that period as well.
Now turning to guidance we expect our strategic markets to drive nearly double-digit growth in our process control business group over Q2 levels. Partially offsetting the lack of the higher price display tool, which we recognized last quarter. In addition to the strong process control group growth, our software business is expected to remain at these near record levels and as a result we expect revenue to be between $59 million and $63 million and non-GAAP earnings in the range of $0.27 to $0.31 per share. This underscores an important strength of Rudolph which is our balanced business model where we efficiently served multiple growth markets by leverage a synergistic product portfolio with our software and applications knowhow to achieve sustainable growth.
Now let me turn the call over to Steve who will review our Q2 financials in detail.
Thanks, Mike and good afternoon, everyone. In my remarks this afternoon I will provide some guidance detailed behind our Q2 results and also provide some guidance on gross margin and operating expenses for Q3. As Mike has already highlighted we saw improvements in almost every financial metric. On our P&L we posted record quarterly revenues, strong gross and operating margins and above guidance EPS. In fact our Q2 results are in line with our long-term operating even at quarterly revenue levels less than previously forecasted.
On our balance sheet we had approximately $10 million in free cash flow for the quarter driven by strong profits and a reduction in inventory balances. So now let’s get into some details. Second quarter revenue was $62.7 million up 15% from $54.4 million in the first quarter and was at the high end of our guidance and was driven by strong lithography tool and software sales. Both our lithography and software groups are poised for a record year in 2016.
Our process control group accounted for 69% of sales in the quarter, this compares to 84% in the 2016 first quarter. The two lithography tools drove our lithography group to 19% of revenue for the quarter and our software group results for the second quarter in a row came in just short of record levels and represented 12% of revenue.
Breaking down our revenue by end market on a percentage basis sales to OSAT customers accounted for 34% of revenue, specialty devices were 21%, with half of that going to RF customers, memory was 9%, foundry 8%, logic 5% and the remaining 8% was in the other category. That adds up to 85% of our revenue coming from semiconductor related sales. The remaining 15% came from the sale to the flat panel display market.
Also breaking down our semi revenue between front end and back end market shows that 75% of our sales were back end and 25% were front end. Those percentages will not be comparable with historical figures as we are now tracking our sales more precisely. For example, previously sales to foundry customers were accounted as front end sales however as you know foundries and many other customers have both front end and back end operations. As part of our investment and operational efficiencies we have enhanced our ability to track our markets and customers.
With the data we are now collecting we will be able to provide better information on where our tools are being used in the manufacturing process. Our gross margin for the quarter was 55% and above the high end of our guidance range this compares to 54% margins in the 2016 first quarter. Our continued strong software sales contributed to our strong margins in the quarter.
Looking at the 2016 third quarter we are forecasting continued strong software sales and an increase in our core process controlled systems and therefore are forecasting gross margins to be in the range of 54% to 55%. Our operating expenses for the second quarter totaled $19 million and was at the low end of our guidance. This compares to $19.5 million in the first quarter. R&D for Q2 was $10.3 million a decrease of $10.9 million in the first quarter. The decrease in R&D was primarily due to reduction in project cost in the quarter.
SG&A for Q2 of $8.7 million was unchanged with the first quarter of 2016. For the 2016 third quarter, we’re anticipating operating expenses to be in the range of $18.7 million to $19.5 million.
Our effective tax rate for the second quarter was 28% and we anticipate our rate for the year to be in the range of 27% to 29%. This lower than historical effective tax rate is primarily due to a higher foreign tax credit in 2016, after implementing changes to our international transfer pricing policies.
Net income for the second quarter was $9.9 million or $0.31 per share above the high-end of our guidance of $0.22 to $0.28 per share. This compares to net income of $5.7 million or $0.18 per share in the first quarter.
Now turning to the balance sheet, we ended the second quarter with cash and marketable securities of $163.1 million. We had strong cash generation in the quarter increasing our cash balance by $14.9 million. Subsequent to the end of the quarter, we repaid our $60 million [ph] convertible debt, which will reduce our cash balance in Q3. However, we expect additional positive cash flow in the quarter, and we also expect to collect $14.6 million from the Camtek judgment next week. So we will continue to be in a strong cash position at the end of the quarter.
Accounts receivable ended the quarter at $64.6 million, a slight decrease in the quarter and our DSOs decreased primarily due to increase in sales in the quarter. Inventory decreased to $70.6 million from $74.1 million in the first quarter. We continue to focus on improving inventory metrics. We have made improvements in the inventory supporting our core process control products. However, some of those gains will be offset by our continued investment in the lithography business and new products.
Capital expenditures for the quarter were $659,000 and depreciation expense for Q2 was approximately $923,000.
Finally to wrap up, during the second quarter, we repurchased approximately 245,000 shares of Rudolph stock under our authorized repurchase program, bringing the total shares repurchased under the plan to 3.6 million. The cost of the second quarter repurchases totaled approximately $3.3 million.
Now I’ll turn the call back over to Mike. Mike?
Thanks, Steve. In conclusion, our revenue for the first half of the year is ahead of the same period in 2015, which as a reminder was a record year for Rudolph. Our long-term view remains very positive as our broad exposure to multiple growth markets allows us to take advantage of customer investments in advanced packaging, RF filters and MEMS, driven by the mobility and IoT markets.
We continue to maintain strong business fundamentals in both gross margin, a measure of the value we provide our customers and operating margin, a measure of our efficiencies, while we increase the cadence of our R&D programs to meet accelerating market needs. Though our markets remain very competitive by leveraging our proven approach of combining products, services and software, we’re building a foundation for sustainable efficient growth and establishing ourselves as a value-added partner for these high-growth markets we serve.
Thank you. And this concludes our prepared remarks. And now, we will open the floor for your questions. Operator?
Thank you. [Operator Instructions]. Our first question comes from Patrick Ho with Stifel.
Thank you very much and nice work on the quarter. Mike, as you look towards 2017 on the advanced packaging side for your core business, obviously, fan-out was a big driver for a lot of your business this year. Are you seeing any other potential interest or demand in other applications, whether it would copper pillar or even TSV as CMOS image sensors begin to migrate towards that process. What’s kind of the outlook as you look forward?
From the process control group, we see both copper pillar and fan-out continuing through 2017. CMOS image sensors, there is a number of the higher end manufacturers that are already using TSV processes today, but these are very large, relatively easy TSV processes. However, we do think with our Clearfind technology that that’s going to be potential growth area for us, as we move into 2017 not necessarily because of the TSV, but because of the challenges inspecting in the imaging array and the types of defects that they are worried about. We believe Clearfind is going to provide some unique capabilities that will be very strong value to them.
Great, that’s helpful. And maybe as a follow-up on the lithography side of things. You shipped and recognized revenue this quarter and you mentioned it was for AMOLED. What’s the interest level there given that the industry is obviously accelerating towards old led type of displays over the next couple of years. What’s kind of the interest level, how do you look at that maybe on a big picture basis what I’ll get it on a quantitative basis?
Well we see a lot of interest in the our steppers capacity Azores came from the display side, we’ve got a number of installations at some of these manufacturers that are doing R&D for next generation old led displays. So obviously the value of our tools is established. The market as you mentioned is clearly going there, so it remains an opportunity for us.
Great. And final question Steve, now that you’ve got a couple of years of lithography business under your belt and now that you’re starting to do volume shipments particularly in the wafer side of things. How has the supply chain adjusted, how do you keep improving margins as volumes increase what are some of the tactics you’ve taken in the past year and as you look going forward?
Good question Patrick. Obviously we’ve got the system specially JetStep wafer system we’ve been shipping those for a while now. So we’ve got to do programs where we’re doing cost reductions from a supply chain standpoint. Obviously I think when we first started we brought inventory up for a several tools we could react quickly. Obviously since then we’ve been ordering new products, but yeah we’ve got -- we've also had time to also look at the designs and see what we can do to improve cost in the system.
So over the last year we’ve taken some cost out of system. But I still think be that as and we’re not even at peak manufacturing anywhere near it. I think there will be some efficiencies in the overheads as we continue to push more stuff to the plant. But it’s still I think it’s going to be a lithography business. It runs -- I’m targeting it to be a 45% gross margin business overall, which is what that’s an ASML type numbers also. But we -- I think the software offset that. So I think our model stays intact.
Great, thank you very much.
We’ll take our next question from Tom Diffely with D.A. Davidson.
Yeah hello. So first question on the front end business the traditional front end business. Maybe a little highlight of how that business is going and how you see it trending over the next couple of quarters?
We see excellent demand for our metrology the MetaPULSE increasing over the next several quarters driven both by traditional front end manufacturers as well as the RF customers.
So at this point how much of that business is RF versus traditional semiconductor?
I think more of it’s like 50-50 or was it…
Well I mean I think I gave out the numbers for the quarter, just looking at it. I mean our logic business was 5% our memory business was 9% of revenue those kind of the traditional front end I think what you’re talking about. And I think Mike mentioned in his point that the RF business was about 10%.
Okay great. Alright and then on the display side, I know the latest flat panel display went into R&D. Is that tool capable of production or is it the size of it limited to the R&D lab?
It’s going to be doing pilot production. So building sample so it’s capable, but for real high value manufacturing they want a larger display size. So we have the capability to do that, but that’s not what they’ve bought so far.
Okay. And your lead times are still quite long for something like that I assume.
Compared to our inspection they are. But we are trying to manage lead times by using up buying inventory and being prepared. So we’re working on gathering forecast from a number of display manufacturers to understand and make sure we’re ready, if they need more of these tools.
Okay. And then, I guess, obviously, on the handset side, you’ve mentioned that some of the big manufacturers are working through the inventory builds from early this year. On the RF side, did you ever see that slow down or is that a situation where the RF chips themselves and the increase in RF dollar content per phone keeps going up, and so that business was solid the whole way through. I’m just curious, how sensitive it is to the actually production versus the design activity?
We definitely saw a slowdown in Q1, no doubt about that. Whether it was because of a digestion period and overcapacity or the customers utilization -- the customer demand itself, it’s hard for us to quantify, but we definitely saw a slowdown, and we’ve certainly seen an increase in Q2, the quarter we just announced as well as looking forward, we see continued demand increasing from a variety of customers.
Oh. Great. Okay. And then finally, Steve on the financial model itself, when you look at the margin structure and how you just posted some very strong margin, you’re guiding towards strong margin going forward. Is it simply the software content? Or is it the fundamental business working at higher margin levels and I did see a year ago?
No, I would say the process control, I mean is obviously somewhat mix dependent, because you’ve got a spectrum of metrology tools, our metal metrology as well as our inspection tool. So within just the process control, as Mike alluded to, going forward, he was saying that see some stronger demand for our metrology products, that’s helping the margin for sure. And then, I think as we improve a little bit on our lithography margins, that’s being offset by the stronger software growth.
So I think we just got a number of things in play that should keep our margins up at this -- I’m not going to tell you, we won’t be down to a 53 or 53-ish, 54 guidance to future quarter, if the mix changes dramatically, but I think we’re at this level just because of the dynamics of all our business elements.
Great. Sounds Good. Thanks for your time today.
Our next question comes from Farhan Ahmad with Credit Suisse.
Thanks for taking my question and congratulations on a solid results. I just have a couple of questions. In regards to the lithography in the AMOLED side of the business, what’s your strategy there? And also can you talk about, is the customer that you’re shipping to, is it a new customer or is it a customer that was already using that tool or had some tools from you before and they are just buying another one? And is this an area that you see as a growth area going forward, because I think like at the Analyst Day, this was not an area you were highlighting. And I just want to understand, if you see AMOLED as a significant opportunity going forward and you’re investing in that part of the business as well?
Well, it’s a -- so you asked a number of pieces, so I’ll try and answer and if I forget something, please remind me. But it’s existing customer, so they had bought tools from Azores the company, we purchased years ago for different application. So this was a new tool for new application, high-res application that they recognize the value and the strength of our tool and for developing these new flat-panel applications, these new AMOLED.
The opportunity we’re quantifying. So there is clear opportunity here. Obviously, it’s an investment from us, so we’re weighing the investment as well as the opportunity. And as we are able to share more with you we will. But right now, this is an area that looks exciting. We’re getting a lot of interest for our technology and we’re certainly aggressively analyzing the potential here. But we’re encouraged by what we’ve seen, and the feedback from the tool and the results the tools producing on site. So…
And could you give some color on like what’s the scale of this customer? Is it like a very large display manufacturer or is it like one of the very small?
I believe this is the largest display manufacturer in the world.
Got it, got it. Thank you. And then, one question for Steve, obviously, like there are few things on the revenue reporting side that seem a little bit changed and in particular when we look at advanced packaging versus front end, Steve you mentioned like your tracking it much better. But just so that we can analyze it a little bit better and get some context on how the sales are doing relatively to historic level. Could you maybe just provide us some rough percentage maybe last year like what portion of your front end business last year was maybe back end even a rough number would be very helpful.
We didn’t analyze. Farhan I can’t tell you that right off with the information I have in front of me I know what you are trying to get to. I mean I’m just thinking last year the perfect example is foundry right which is a lot our case driven by TSMC. I mean last year’s numbers we would be drawing foundry in front end with memory logic foundry. Even though there was even back then a back end component to a lot of the business that we will be selling into TSMC for example. Obviously info skews it a lot this year. So I could probably talk with you offline and see if I could kind of reshape it for you a litle bit.
Got it, thank you. Thank you, that’s all I had.
[Operator Instructions] Our next question comes from David Duley with Steelhead Securities.
Thanks for taking my question. Could you just help me understand what you guys are expecting in the second half of the calendar year for the lithography business and would you expect to just kind of number of units that you have announced just recap that type of stuff and then talk a little bit about the initiatives on panel lithography from your customers because there seems like there is a lot more buzz about that particular process.
So what we are seeing is increased utilization of the tool. So there is a lot of new entrance into the -- and investments into fan out wafer level packaging. So a number of those customers that are currently ramping lines with JetStep are also qualifying products for future orders and as they get those orders we expect some level of repeat sales. Hard to quantify the timing of that as they are also waiting. But we would expect at least additional tool stepper sales in the second half at least one additional one besides the one we’re already shipping in Q3.
As far as the panel goes the -- as you know we are shipping a panel tool this quarter. We are seeing invest -- let’s say a focus from larger IDMs in this area. So a number of different manufacturers looking to help scale and improve their competitive situations through advanced packaging and panel level packaging in particular. This is both for let’s say heterogeneous die. So different die being put together with fan out as well as the traditional same die all on a larger panel and just getting economies of scale there.
And what are some of the ways that you feel going forward that you can capture more business from your entranced competitor?
Continue to execute is the biggest thing. We have the technical advantages they have the lion share of the market and we need to continue to educate the market and demonstrate our technical advantages and eventually as is happening we’ll continue to expand our footprint.
Okay. And then to switch gear a little bit, you talked about yours sales in the 3D inspection business I think you mentioned it went like $3 million and $5 million or $3 million to $8 million something like that a nice ramp up in business and how that was bigger than what had done in all last calendar year already in the first half of this year. What would be the outlook for the 3D revenue in the second half of the year and how big is that market and do you have a market share goal there?
The market share for 3D is not really broken out and because these tools are becoming combined with 2D inspection tools it’s even more difficult to break them out. But that being said, obviously our goal is to be number one and we expect we see no why we can’t be we have some pretty aggressive road maps and in that that regard. The outlook for second half is I would say based on what we’re seeing probably equivalent to what we’ve done in the first half.
Okay. And then final question from me, there is a big foundry you made a large round for investments for its fan out wafer line. And I would suspect that it would be another round of investments coming. And I was just curious if you could -- do you think that this calendar or are you planning for 2017?
I think it’s most likely early 2017. Although they did announced increased revenue I believe through if we’re talking about the same foundry who increased the spending. They announced $100 million in additional sales for the fan out line. So as they continue to increase their capacity and fill out that line then they’ll expand. But we’re not expecting that until maybe early ‘17. But we’re ready if it’s sooner.
Okay. One more in here, as far as your overall inspection business goes, with that in mind with the big foundry guy how does the outlook here in the third and the fourth quarter look from the all of the major OSATs and the other spenders that are putting in advanced packaging and inspection equipment?
How does the outlook of the foundries and OSATs for advanced packaging look?
Yeah well given the fact that it looks like the large foundry isn’t going to be ordering until next year and putting in more capacity, I was just curious if are you seeing a lot of the cuts in the assembly guys of the OSATs putting in fan out capacity for the second half of calendar year?
Yeah. Well that’s a great question, we are seeing that and we’re seeing it across a number of different customers, which is again one of the strengths of our business model is the number of customers we serve. And you can see that reflected in some of the growth we talked about for the quarter we grew double-digits we’re expecting to grow low double-digits in our process control group for the quarter. And Q4 is traditionally a weaker quarter from the back end perspective, but based on what we’re seeing it may not be as weak as tradition would have it.
Excellent, thank you very much.
And it appears there are no further questions at this time. I’d like to turn the conference back to Mike Plisinski for any additional or closing remarks.
Thank you everyone for joining us today and for your continued interest in and support of Rudolph. And with that we’ll conclude today’s call.
And once again that does conclude today’s conference. We thank you for your participation.
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