Q1 2023 Motorcar Parts of America Inc Earnings Call
Hello, My name is Chris and I'll be your conference operator today at this time I'd like to welcome everyone to the motorcar parts of Americas fiscal 2023 first quarter conference call.
Lines have been placed on mute to prevent any background noise.
After the Speakers' remarks, there'll be a question and answer session.
You'd like to ask a question. During this time simply press Star then number one on your telephone keypad.
To withdraw your question. Please press star one again.
Thank you Gary Maier VP of Investor Relations and corporate Communications you may begin.
Thank you. Thank you, Chris and thanks, everyone for joining the call today before.
Before we begin and I turn the call over to sell and Jonathan Chairman, President and Chief Executive Officer, and David Lee The company's Chief Financial Officer.
Like to remind everyone of the Safe Harbor statement included in today's press release.
Private Securities Litigation Reform Act of 1995 provides a safe harbor for certain forward looking statements, including statements made during today's conference call.
Such forward looking statements are based on the company's current expectations and beliefs concerning future developments and their potential effects on the company.
There can be no assurance that future developments affecting the company will be those anticipated by motorcar parts of America.
Actual results may differ from those projected in these forward looking statements. These forward looking statements involve significant risks and uncertainties.
Some of which are beyond the control of the company and are subject to change based upon various factors in particular expectations about anticipated future growth and opportunities with customers may not be achieved the company undertakes no obligation to publicly update or revise any forward looking statements.
Whether as a result of new information future events or otherwise.
For more detailed discussion of the ongoing risks and uncertainties of the company's business.
Refer you to the company's various filings with the Securities and Exchange Commission with that said I'd like to begin the call and turn it over to Selwyn.
Jonathan Thank you Gary I appreciate everyone joining us today.
I hope, you're all safe and healthy as announced this morning, a new fiscal year is off to an excellent start with sales climbing 10% on a year over year basis, reaching record levels supported by continued strong demand for non discretionary products across our north American customer base.
Let me highlight several items that support our optimism as fiscal 2023 evolves.
Our brake pad line utilizing an industry, leading proprietary formulation is rolling out as planned as our brake rotors brake caliper operation continues to gain momentum with expected operating efficiency improvements as volume increases with fixed cost absorption opportunities we have.
Targeting a break related business to exceed $300 million in annual sales above that fiscal 2022 reported results in the next three to five years.
We are growing sales in Mexico, with multiple product lines, including rotating electrical wheel hubs and master cylinders.
All major automotive retailers continue the rollout of our rotating electrical bench top tester and we expect sales from this opportunity to reach a cumulative $80 million over the next five years.
Also expect additional revenue from maintenance and add on services.
Our EV contract testing center in Detroit, Michigan continues to attract interest to support the design and development of electric vehicles. This contract testing as an initial entry into SaaS software as a solution model.
We're excited about all of our multi year new business commitments I expect these numerous opportunities to continue to fuel that growth.
As I emphasized during our fiscal year end call in June we are well positioned to address both the internal combustion engine market and the emerging electric vehicle market with product functionality and applications across both markets.
Nonetheless, we expect strong demand for internal combustion engine applications for four decades, and we offer a broad line of non discretionary aftermarket parts necessary to service the internal combustion engine car population of approximately $280 million.
At the same time, our applications and services also offer significant opportunities to address the emerging electric vehicle market.
The electric vehicle market continues to gain momentum. So we will not only benefit from a non discretionary product offerings, but also from increasing demand for battery power emulation.
And development of Inverters Electric Motors and high speed battery charging applications offered by our electric vehicles subsidiary.
As I highlighted earlier, a bench top test as well Tonight and we'll start has continued to rollout of more than 15000 retail customer store locations.
These bench top tester is enable retailers to offer accurate advice with the latest protocols to diagnose problems for consumers and reduce unnecessary returns.
This provides a value added benefit for the retailer while strengthening their consumer relationships.
Notwithstanding the continuing challenges facing the aftermarket industry and all businesses for that matter. During these unpredictable times. We are working diligently every day with our customers and suppliers to meet the demand for our products.
Let me take a moment to summarize where we are today.
Our strategic investments have been completed we.
We have further solidified our position in the industry with an expanded line of non discretionary automotive aftermarket products customer commitments and opportunities.
Our global footprint is scalable supported by approximately 6000 global employees with vast experience to support growth and profitability.
We believe our initiatives will fuel our growth to more than $1 billion in sales.
I will now turn the call over to David to review our results in greater detail.
Thank you Lynn and good morning, everyone I would like to encourage everyone to read the earnings press release filed as an 8-K earlier today, which contains more detailed explanations of our results on.
On this call today I will review our fiscal first quarter results.
As someone mentioned that we achieved record net sales for the fiscal first quarter, reaching $154 million and increased our 15 million or 10% from 149 million for the prior year.
Gross profit for the fiscal of 'twenty, three first quarter increased $6 7 million or 28, 6% to $30 3 million from $23 6 million a year earlier.
Gross profit for the quarter was impacted by noncash items as well as cash items.
Let me provide details for each and then I will provide further details on the impact on each additional line item you can accurately understand underlying fundamentals between periods and appreciate our optimism as our new fiscal year evolves.
The noncash items reflects.
Core and finished good premium amortization and revaluation of cores on customer shelves, which are unique to certain of our products and required by GAAP.
The total for these noncash items in the quarter was approximately $3 6 million.
A more detailed explanation of core accounting is available on our website now I would encourage anyone with questions about this topic to review the video.
In terms of the cash items, let's begin with Malaysia.
Sat down at the country by the government due to Covid and then the slow reopening impacted our facility and our regional network of key suppliers in response we.
Quickly move to outsource certain products from China.
These products were unfortunately subject to 25% tariff these.
These are transitory disruptions in the supply chain.
As well as timing of shipments are being reduced as you ramp back up in Malaysia, and our suppliers we cover.
As a reminder, one of the benefits of production in Malaysia as low test. So a return to production at our facility in this country. There is also a fairly immediate relief on tariffs.
Next we incurred higher freight costs.
Excess of customer freight surcharges that we already implemented we've taken swift action to implement additional freight surcharges and further price increases to mitigate this impact going forward.
These are expected to be further in effect in the fiscal second quarter ending September 32022.
To offset more of the higher freight costs, we incurred based on current rates.
Total cash impact of these transitory costs, including freight and task related to supply chain disruptions on gross profit was $2 5 million compared with $4 8 million a year ago as referenced in exhibit two of this morning's earnings press release. So in short we are encouraged that these costs are decreasing.
Before moving on I should note that there were no ramp up and transition expenses related to our Mexico expansion in this quarter compared with $1 9 million in the prior year first quarter.
Fees that brake caliper production is increasing nicely.
Reported fiscal first quarter gross profit as a percentage of net sales was 18, 5% compared with 15, 8% a year earlier.
Reported gross margin was impacted by two 2% from the previously mentioned non cash items as well as one 6% on a previously mentioned cash items from transitory costs related to supply chain disruptions.
We continue to experience extraordinary global supply chain challenges.
And inflationary costs, while our price increases were not fully in effect and we made strategic inventory investments to support business growth and mitigate supply chain challenges.
In addition, gross path as you would expect was further impacted by three key items first we experienced inflationary costs related to raw materials and supplies and offshore wage increases.
The price increases as I mentioned, a moment ago should help offset these price pressures.
The experience of ramp up costs related to our growth initiatives for our new brake caliper product line with price increases and the ramp up of our new business opportunities, we expect enhanced gross margins.
Finally, gross margin was impacted by product mix.
Moving on operating expenses were $23 million compared with $17 8 million for the prior year period the.
The increase was primarily due to a noncash loss of 678000 for the Mark to market foreign exchange impact of lease liabilities of smaller contracts compared with a noncash gain of $2 5 million for the prior year first quarter. The remaining $1 9 million increase was primarily due to increased commissions.
Employee related expenses professional fees travel outside service expenses and noncash foreign currency fluctuations.
We reported a net loss of 175000 or <unk> <unk> per share a primary factor was due to higher interest expense, reflecting higher interest rates, which are being addressed by working with our customers, including price increases and we are focused on generating cash flow to pay down borrowings.
Additionally results were impacted by items that totaled $6 9 million or <unk> 36 per share as follows.
These include noncash items totaling $4 2 million or <unk> 22 per share, including <unk> <unk> premium amortization and revaluation of cores on customer shelves totaling $3 6 million as previously explained.
Noncash items also included a loss of 678000 or <unk> <unk> per share on a pre tax basis for the foreign exchange impact of lease liabilities and forward contracts.
Cash items that impacted results include transitory cost related supply chain disruptions totaling $2 8 million or <unk> 15 per share.
Additionally results for the fiscal fourth quarter were also impacted by higher interest expenses, primarily due to higher interest rates compared with the prior year.
<unk> expense was $6 9 million compared with $3 9 million for last year, primarily due to higher interest rates.
The accounts receivable discount programs offered by our customers and higher borrowings to support higher sales.
Additionally, the income tax expense was $589000 compared with 947000 in the prior year period.
You also mentioned that the effective tax rate was impacted in part due to specific foreign jurisdictions from which we did not expect to recognize the benefit of losses. However, we expect these losses will be utilized against future profits, which will benefit future tax rates.
Net income was 861000 or <unk> <unk> per diluted share in the year ago period.
Results are you earlier were impacted by a total of seven 6 million or <unk> 39 per diluted share. These include noncash items totaling $2 million or <unk> 10 per diluted share, including a noncash gain of $2 5 million or <unk> 13 per diluted share our pre tax basis for the foreign exchange impact of lease liabilities and <unk>.
Word contracts.
And cash items totaling $5 6 million or <unk> 29 per diluted share primarily transitory costs related to supply chain disruptions.
EBITDA for the first quarter was $10 5 million EBITDA was impacted by $5 5 million of noncash items as well as a $3 7 million in cash items, primarily due to the transitory costs related to supply chain disruptions.
EBITDA before the impact of noncash and cash items mentioned above was $19 7 million for the first quarter.
EBITDA for the prior year first quarter was $8 9 million.
A year ago was impacted by $2 7 million of noncash items as well as seven 3 million of cash expenses, primarily transitory costs related to supply chain disruptions.
EBITDA before the impact of noncash and cash items mentioned above was $18 9 million for the prior year first quarter.
Now, we will move on to cash flow and key corporate items.
Net cash used in operating activities during the fiscal first quarter was 982000 versus $4 7 million cash used in operating activities in the prior year period. This.
This reflects working capital requirement.
Record sales growth and inventory increases for anticipated business growth as well as proactive strategic initiatives to address potential supply chain disruptions.
We believe that these investments in our business, we're not only mitigate risk, but will also spur further growth on the company on a year over year basis.
We do expect to generate cash from operating activities for fiscal 'twenty three we expect to generate an increase in operating profit on a year over year basis supported by organic growth from customer demand introduction of new product categories price increases and operating efficiencies from our footprint expansion that we completed last year.
Our return on invested capital on a pretax basis at June 32022 was 18, 9% compared with 22, 1% a year earlier.
As our investments bear fruit, we expect to realize further benefit from the expansion of our Mexican operations and the launch of our new brake categories with expectations of increased returns from both new and existing product lines.
Lastly, our net debt at the end of the quarter was approximately $152 6 million, while cash and availability under our revolving credit facility was approximately $95 5 million.
For further explanation on our reconciliation of items that impacted results and non-GAAP financial measures. Please refer to the exhibits one through three in this morning's earnings press release.
Now I'd like to open the line for questions.
As a reminder, if you'd like to ask a question. Please press Star then one on your telephone keypad.
Our first question is from Brian Nagel with Oppenheimer. Your line is open.
Hi, good morning.
So I'm, sorry, I have already okay.
Morning, depending where you are right.
So I got a couple of questions.
First off just I guess first maybe bigger picture just with regard you talked about the nice sales increase.
Fiscal Q1.
Drivers behind that were behind that I know, we talked a lot about just what youre seeing from a consumer's perspective, particularly given a while.
Various factors out there play right now to Wilton re gas prices or just discretionary spending broadly, but then my second question just with David you laid out a lot of that kind of puts and takes with with gross margin here in the quarter.
The question I have is and how should we think about and recognize you don't really have Walter guidance out there, but how should we think about the underlying margin potential of the business.
Some of these factors begin to normalize.
Okay. So let me start out just with the demand side of the question.
I think the fundamentals of the aftermarket continued to be strong I mean, the average age of vehicles has over 12 years, yes gas prices have gone up.
Alternative.
Cost of travel and so we see a fundamental <unk>.
Strength in the demand.
For non discretionary parts.
And.
Sort of seeing that across the board.
And our product lines.
<unk>.
I would say.
You know the miles driven is a little bit of a headwind, but we continue to see growth. Despite that I think that that's reversing out.
I think the opportunity for <unk>.
We're fairly comfortable with.
We will continue to see strength in sales were off to a strong start this quarter. So.
So that looks good.
In addition to sort of the base organic grew.
Growth that I see from the fundamental statistics within the aftermarket.
We're also experiencing.
And I wouldn't be too exuberant, but I'll call. It significant success in our brake pad and wrote a business.
The demand the demand profile for that is turning out to be.
Very very strong.
As we ramp up through that we expect again.
We mentioned that we think are great product lines can reach $300 million.
And.
So I think the speed depends on how fast we can ramp up.
And get changeovers down on customers' shelves so.
Very positive there.
Mexico expansion is going well and we continue to grow that business.
Break our bench top tester, we have all three retailers committing to rollout the bench top tester in their stores and more interest from others.
So that bench top tester business, while it has taken us some time to get here.
It looks like the thesis is unfolding as we expected.
Be it a little bit longer than we thought it would take.
And then last but not least I think there are some headwinds a little bit on the EV capital expenditure.
Where.
Some of these Oems are not getting the supply that they want so they are pulling back on some of the capex, but having said that we see our base fundamentals in that business or so.
Perhaps strengthening in the new sort of a new direction.
We're focused on trying to drive revenues from software. So so all in all for US I think we have so many multiple drivers for our business.
Right now, but we're bullish on our opportunity.
When you see more volume that goes through the volume that goes through our facilities, we've got an overhead structure.
Designed to support this growth and so leveraging.
The existing overhead with incremental revenue will certainly contribute to better contributions on the gross margin side and on the operating income side.
I think short term margin profile were looking.
No.
Sure.
<unk> as we get through that.
We're going to have to see what happens with inflation.
And how we keep up with that with the price increases we continue to lag the market dominant on price increases just with a time delay of getting it getting it through our customers but.
No.
We are getting price increases.
Sure.
And now we are suddenly.
Eliminating any waste that we possibly can from our structure. So that we can enhance the margins as we go forward.
Okay.
Thanks, Joe I appreciate all the detail.
Thank you Anna.
Next question is from Matt Koranda with Roth Capital Your line is open.
Hey, guys.
Thanks.
Just.
Hey, guys.
So maybe just I guess my traditional first question is usually could.
Could you provide a breakdown of revenue by product category, David returned rotating electrical wheel hubs break and other products.
Yes, so for the first quarter, our rotating electrical was 67% wheel hubs, 12%.
Break related products, 17% and other was 4%.
Okay, great. Thank you.
And then.
I think in the release you guys had said that demand had improved throughout the quarter, especially in the May and June timeframe. I'm curious if you could maybe speak to the magnitude of that improvement and then just any commentary on sort of follow through as we've gotten through July .
August obviously a bit early here, but just any commentary on follow through on that demand through July .
Yes, I don't know off the top of my head the exact increases between the first months on the back months, but its double digits.
And it's continuing and we expect we expect to have a strong quarter.
<unk> continues to be strong and that's fueled by organic organic demand and growth and then also by the rollout of all of our new brake.
Greg Pat and brake rotor business.
So and as the quarters progress we expect.
A bench.
Test the business to continue to increase we have.
We are starting to receive purchase orders from from.
From customers, there and thats ramping up nicely so a lot of growth drivers.
I think as we get through I think I've mentioned in the past Matt.
And our price increases in September October .
Should see the majority of them through that.
We should see the margin profile will get better as volume and price increases.
Hey, Ken.
Okay got it Paul you mentioned price zone.
Yes, that's helpful. So.
Since you mentioned price.
Maybe just curious if you could maybe disentangle or help us understand how much price contributed to the 10% year over year growth in the quarter and then you did mention there is some incremental price action. It sounded like maybe even in addition to what you had talked about on the last call.
When you had mentioned higher factoring costs and I'm curious.
If that if that comment was in reference to price action that is incremental to what we've already discussed on calls before or is that sort of just what's on the come from.
You had mentioned on the last call.
Yeah.
I think.
It's hard to break down the differential because the.
The mix of products has changed so dramatically.
No I mean, the new product launch certainly contributed to the growth of the pads on the road as there is some price increases that contributed to.
So the growth.
<unk>.
But I still think that when I look at fundamental demand through the register continues to be strong.
And can you repeat the second part of your question, Matt I missed that Im sorry.
Yes, sure that you had mentioned sort of.
In the prepared remarks that pricing action.
Was either in place or employment or in the process of being implemented to offset some of the increase in factoring costs that you guys are experiencing just with the higher rates.
I'm just curious if that was incremental price tag that is over and above what we've discussed on prior calls.
Yes. It is so we have product we definitely have product price increases that are staged to come in and are now.
We're working through the factoring cost.
Increases lets separate and above yes.
Okay, Alright got it understood.
And then I didn't hear you guys discuss the outlook for fiscal 'twenty, three and maybe I missed it but.
Or are we just to take.
Sort of the <unk> in line here with our expectations as sort of a reiteration of the full year fiscal 'twenty three guidance for revenue and EBITDA any changes to sort of the outlook from your standpoint.
No no changes, we still we still have the same outlook, but we're feeling real positive about how things are.
Developing.
Great.
And then just lastly.
You mentioned a goal of.
300 million between sort of the new brake products.
You've launched over the next three to five years just curious if.
Folks should be factoring in sort of a linear progression to that $300 million over the next call. It four years or so if I'm, taking the midpoint of the goal.
How does that sort of play out and then when we get to maturity and the brake products business. What does that look like in terms of the mix between pads rotors calipers and other great products.
Okay. So I think linear is probably a good let me let me try and do it one at a time linear is probably a good example, I mean, obviously, we are starting from zero I think that we will see.
You know as we go.
Through this fiscal year, so next fiscal year.
We should see that business grow by 100% in the next fiscal year.
We were coming off of a launch here.
And then sequentially after that we expect double digit growth in that business.
So.
You know that.
Good.
The mix between.
Between these.
It's a tougher one to predict I mean, we today we include brake calipers and the.
And the break related product so that that mixes we are pushing close to.
Close to a $100 million in that business.
As we get through our commitments with all of our new customers on them.
And our roads and pads I think we are probably looking with existing commitments.
North of $50 million to $60 million, just as a kickoff and so.
The breakdown going forward eventually I'm not sure when those when those terms, but the pads on road is will become the largest revenue generated out of the brake category.
That's not to say that the rest of the brake category is not going to grow significantly just the fact is that breaks and road is or not.
I mean, there are reported they are not a failure item there replacement item and so you get far more far more volume out of our glass in the pads.
Certainly the most exciting part of the road of pad equation for US is the we have a very unique proprietary formulation for a brake pads.
And.
And it's only it's being sold under our own brand name.
And so.
The.
And it's a proven formulation as well.
And a very recognized formulation by the professional installer and so as we get this product out the traction and the ability to roll all of our other products out under the same brand names to customers that may not have tried our brands in the past is pretty significant so.
We're bullish on it.
In particular, the pad business on the road has come along as sort of a.
And mandatory match.
Where you can.
Match up your friction with your lithium metal.
So.
Hard to tell you exactly what that mix is going to be but again longer term as you look out four to five years. The pads on road is going to be the biggest part of it.
Got it yeah it sounds like.
If I'm paraphrasing caliber is probably a little further along in the growth phase maybe not.
Not hitting maturity, yet, but more mature than the other two but yes.
Rotors and pads.
Eventually eclipse the caliber opportunity over time.
Size of the category so much larger as oil.
So just by definition, if we can get to our fair share in each of these categories the pads and rotors should be very significant amount of revenue.
Alright, perfect got it I'll jump back in queue guys. Thank you.
Okay I appreciate it.
Again, Please press star one if you would like to ask a question. The next question is from Bill <unk> with Titan Capital. Your line is open.
Alright. Thank you I wanted to pick up on <unk> comment in the release and someone else has already asked about that momentum building in May and June .
Could you discuss in a little more detail why.
That momentum has been accelerating.
Well I think I wish I knew exactly Bill I Couldnt tell you. The exact reason that I can give you some theories.
Firstly, I think if you listen to the retail of public reports that.
There was a lot of rain.
Early in the quarter and so suddenly the diyer.
Generally when were those bad you'll see sort of a decline.
Their immediate repairs and then the next part of it is we've had some extreme heat throughout the country.
Suddenly for all rotating electrical and some of them even for and for the brakes.
When you have extreme meet you have accelerated.
Failure rates.
So I see that in them.
Over and above that you've got.
We've had delayed update orders that are starting to come in we have the new launch of our new product lines are starting to come in we have so much new business kicking in.
In multiple categories, we have new business, that's ramping up.
That starts now really.
As we go forward and then price increases so.
This is coming from.
In a positive way.
I want to be cautiously optimistic that in a positive way coming from a lot of different areas.
That's that's helpful. Thank you and relative to inventory, we know that you have intentionally increased your inventory.
Do you feel like you have one.
Orders.
As a result of having that higher inventory and maybe in cases, where others were not able to fulfill orders and you were able to slide in there.
Yes.
I won't comment on how those because I don't really know that as factual, but I can tell you that both.
Significant wins in the brake pad business and in the and the brake caliper business, we're dependent on us having the inventory.
And so yes, having that inventory was a significant competitive advantage and again when you have uncertainty in supply chain customers are not willing to take a chance with that knowing that youll supply chain is reliable they.
They don't want to take a chance on switching suppliers because the last thing they want to do is switch of supply and fund that and not having not getting product.
Our fill rates are.
Considering the environment until rates actually excellent.
And.
And I think at the end of the day that is a competitive advantage here.
That's helpful and then.
I did just hear what you said so pardon. This next question, but do you feel like inventory has now peaked out and then it will fall from this level.
Or is is this really a new a new normal, particularly given what you just stated.
No I think that we I think the supply chain is opening up I mean borrowing again.
There is.
It's hard to predict and our shutdowns in different places, but it seems like the supply chain is opening up.
I think we've got our arms around it and I think we have peaked out on inventory.
Suddenly inventory as a percentage of revenue should start coming down.
We shouldnt, we should see some positive cash flow and some.
And some.
Easing of the inventory requirements.
Great. Thank you and then I believe that that with everything you've said that I think I understand the answer to this next question, but are you feeling like the March quarter. So last quarter was the low point for both reported and adjusted gross margin.
And we had growth this quarter sequentially that that will continue now going forward.
Yeah.
Yes look I think theoretically that is correct.
We are subject to fluctuations in foreign exchange, which is unpredictable.
But putting that aside I mean, interestingly enough I read this morning or yesterday, yes.
Warren Buffett made a comment on.
The people get confused assessing Berkshire hathaway's.
Performance because of the mark to market fluctuations in these portfolio.
And.
We have the same <unk>.
What durations than mark to market, whether it be from foreign exchange relating to our lease liabilities.
Or two.
The noncash write down of cores and customer shelves.
And I just think that he said he encourages people to ignore those.
Win win.
Evaluating the company's health and I feel the same way so if you ignore those.
I think I think you are correct I think that we did see a low point.
So, yes, I mean, I think our fundamentals today I mean, what we've done over the last five years and I've been trying to say it is as clearly as I can as we've done a few things.
We've changed the footprint of our organization to two to leverage low cost production opportunities.
We've also changed the footprint to become less dependent on China imports, which makes us less susceptible to the Chinese tariffs.
We've also.
Increased capacity to leverage the existing G&A. So that we can start seeing better operating income margins and we have also leveraged our capacity to take on all of us the new product lines on the new business that we're getting which ultimately will help the operating.
Absorption and gross margin profile are all of that now is fundamentally completed we've now just got to ramp up get the new business under control.
Started shipping that.
Again, we've given guidance and we are optimistic about about our guidance and.
And we are optimistic about our business in general.
Despite a pretty unpredictable time, I, just do want to be cautious there.
This unpredictability in the world today, as we all know but.
Putting that aside we feel like we are strategic initiatives all set to start reaping the benefits Ralph.
Great. Thank you and if we have time for one more I'd like to ask relative to the interest expense David what alternatives. If any do you see to reduce your interest expense other than paying down debt.
The obvious.
So as we had commented we are working with our customers to address price increases and as you pointed out also generating positive cash flow for the year to pay down borrowings.
And those price increases are essentially in part to offset the higher the higher our AR factoring costs.
Just overall market rates that have increased.
Great. Thank you both.
Thank you.
We have no further questions at this time, Mr. John field, turning to you for any closing remarks.
Okay, well I think as you.
As you've all heard.
Just in summary, we are excited about our future and the prospects ahead of US we have built a solid foundation for both topline and bottom line growth from our existing product lines and supported by strong demand for replacement parts until wins from an aging car Park.
In closing as usual I want to thank all of our team members for their ongoing commitment and customer centric focus on service. They have been absolutely outstanding during these challenging times.
We are particularly focused on the safety and well being of our employees and I am extremely proud of our team members and our company.
For their performance and conduct.
And we appreciate all of their continued support and I. Thank you all again for joining us for the call and we look forward to speaking with you when we host our fiscal 2023 second quarter conference call in November and at Investor conferences in the future.
To you.
Ladies and gentlemen, this concludes today's conference call. Thank you for participating you may now disconnect.
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Yes.
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