Q4 2022 Applied UV Inc Earnings Call
Greetings and welcome to the applied U V fourth quarter and year end 2022 financial results Conference call.
At this time all participants are in a listen only mode.
A question and answer session will follow the formal presentation.
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Please note this conference is being recorded.
I turn the conference over to your host Brett Maas of Hayden IR.
Okay.
Thank you once again welcome to apply to these 2022 earnings call with me today on the call are Max mine, founder and CEO , President and director, Mike <unk>, Chief Financial Officer, and Brian Stern, President apparel lighting as a reminder, all materials for today's presentation are available on the company's Investor Relations website at <unk> Dot com sorry.
Let's say again applied UV ink dot com before we begin please take a moment to read the forward looking statements in our earnings press release during today's call. We will make certain predictive statements that reflect our current view about future performance and financial results.
These statements on certain assumptions and expectations of future events that are subject to risks and uncertainties. Our most recent Form 10-K lists some of the most important risk factors that could cause actual results to differ from our predictions with that I'll turn the call over to maximize Baxter floor is yours.
Thank you Brett and good morning, everyone. My name is Max amount I'm, the founder of applause.
And I became the CEO about three weeks ago.
As it was for most other companies 2022 was a very challenging year.
Our challenge arose from the acquisition of scientific Air in late 2021.
With disinfection products that were substantially focused on one distributor short too.
Scientific Air was also focused on one industry, which was hospitals and with revenues totally driven by COVID-19, Consequently sales collapsed four scientific air in 2020, 'twenty two as the pandemic receded and.
Unfortunately, our previous senior management's focus did not repositioned the company to address this weakness at scientific air. Consequently, we recently determined that it was best to write down.
Substantially portion of our investment in scientific here and put this problem behind US. In addition to this noncash write down of goodwill.
The company has incurred.
And our 2022 financials include significant one time integration and acquisition costs related.
Just legal and accounting expenses associated with our more successful acquisitions included.
'twenty two.
Expenses are other noncash items, such as depreciation interest.
And the issuance of options to employees 2022 was indeed, a very challenging year, but it was also a turnaround year.
Therefore.
Starting 2023 with our company much better positioned to achieve significantly improved results.
I am extremely optimistic.
As a reminder, applied UV as two operating segments.
<unk> elimination of disinfection segment.
Which includes the development manufacturing marketing those air and surface Disinfecting systems.
And the hospitality segment, which includes domestic manufacturer of better mirrors and premium furniture, specifically for hotels resorts and related properties.
Now I'd like to take a more detailed review of our hospitality segment.
In hospitality mud works.
Is resuming its prepaid debit growth as this industry continues to show strong growth fueled by.
The post pandemic travel search.
Which has accelerated faster than generally forecasted this market growth has heightened the need for hotels to make capital improvements to facilities in order to maintain their franchise flags.
Something that was postponed for almost three years due to the pandemic.
Hotel operators are now required to catch up on delayed refunds.
<unk> fishermen.
In the last few months, we had several hotel developers place multimillion dollar orders with our company this surging demand.
Coupled with our newly acquired 100000 square foot manufacturing facility located in Brooklyn, New York has given us a strong competitive advantage due to the demand for domestic manufacturing by these hotel operators.
Cost differential between China and domestic manufacturing has decreased.
<unk> due to the 25% tariff.
As well as other factors, leading hotel management to favor U S based manufacturing.
Additionally.
There was a significant fear of potentially higher tariffs because hotel developers are concerned with the ongoing negative dialogue between the U S and China worrying that any potential conflict or even a threat of a conflict could result in more global supply chain disruptions as well as incremental.
And increased tariffs. These factors are driving more hotel operators to domestic manufacturing to mitigate supply chain delays and enable hotels to better manage project timelines and ultimately the revenue generation.
Due to the shift and with very limited U S competition, we were able to raise prices significantly without displacing orders, which will result in margin expansion, which we expect to accelerate in the first half of 2023.
Yeah.
As part of the Brooklyn facility acquisition, we inherited a number of lower margin products due to the fact that 50% deposits were paid in advance of our acquisition of the facility, but pay to prior owners of that business, leaving us with fulfilling those major hotel.
Commitments without the benefit of the associated cash receipts, we delivered on those commitments and all of our legacy orders have now been fulfilled.
Our sales pipeline for hospitality, which is approximately $10 million to date with projects underway and slated in Cleveland, Washington D C Indianapolis Orlando in Knoxville.
We also plan to increase mine works revenues through the installation of our pathogen elimination devices.
As an option into our hotel guest room furniture to be supplied to better hotels.
Now, let me discuss the pathogen elimination of disinfection segment of our business.
The domestic UV disinfection market is expected to reach $9 billion.
Yeah.
In 2027.
The CDC states that each year, one in 25 patients gets a hospital acquired infection, resulting in over 3 million serious infections at a 100000 deaths annually.
This amounts to losses from contagious pathogens that cause the U S economy more than $270 billion, including.
Loss productivity due to absenteeism.
Recent CDC warning about the rapid spread of new and deadly drug resistant Super bugs, such as C. Auris, coupled with the urgency for improvements it indoor air quality within HVAC systems in order to control the spread of pathogens will continue to drive adoption.
Of many of our proven systems.
Our recent acquisition of Piero and its technology further validates our long term strategy for developing or acquiring the best technology to protect all of us from definitely pathogens. This strategy is.
It's not only correct, but it is now firmly in place.
Our technology helps keep people safe, but just as important our technology protection extends the shelf life of high value agricultural products with shortages in purchase restrictions, the resulting food insecurity being reported throughout the world. We have concluded that protecting food from Ford.
From farm to table is a high priority and a major opportunity for us.
Currently with 15% to 25% of shipped agricultural products lost to spoilage during transit to distribution centers and transfer the food retailers.
Our company and adventure with Canon Virginia.
Unit of the Japanese company will soon introduce a proprietary air purification system that can be incorporated into ship the containers and long haul refrigeration trucks as well as district.
Excuse me distribution centers that we expect will significantly reduce food spoilage. There's technologies the same photocatalytic oxidation system, which we developed for NASA for use in the international space station.
Our technology is not only currently being used to ing crews increase the shelf life for food, but we are already generating revenue in the cannabis industry and then one storage and we also expect to expand into the presentation of cut flowers during transit in display.
We believe that our focus on food security is as urgent as this healthcare and is also one of the highest investment priorities in the world today, We plan on growing our revenues and post harvest food security by leveraging our success with our aerosol product line, because we have already demonstrated the reduction of <unk>.
Food spoilage of high value fruit and berries with global.
Companies, such as Dell Monte do whole foods and others.
Two months ago, we completed the acquisition of pure lighting as well as Leds supply.
As a result, we are forecasting total.
Total revenues of approximately $45 million to $50 million.
Excuse me for this current year, approximately a 100% increase over 2020 to.
This further positions apply do you view as a fully integrated company <unk>.
Providing a broad pathogen elimination platform with leading technology.
That can be used by consumers businesses and governments.
At this point I want to also reiterate.
That I personally agree with the recent projections by a major investment banking research analyst.
Our common share price will likely reach $2 50.
By the end of this current year.
Our primary focus for growth in 2023, we'll be on food preservation healthcare and safe building systems and will include the.
The complete installation.
Utilizing proprietary software.
And facilities HVAC systems, which we'll continually monitor indoor air quality with the merger of Piero.
Complete our wholly owned subsidiary Istar alumina is gaining critical mass to address the ever challenging.
And ever changing.
Challenge of combating air and surface pathogens.
Hospitals for acquired infections, protecting businesses and their facilities and their employees and consumers who frequent to facilities.
After a long delays due to the comp.
Covid pandemic late.
Late in 2022, our company began a clinical trial without Luna side sync and drain disinfection product at the prestigious Mount Sinai Hospital in New York City, we expect to announce the results of this highly anticipated clinical trial.
In Q3 2023.
To support our planned growth we formed.
Hey, Scientific Advisory Board.
With renowned infectious disease scientists.
As well as one in food preservation experts.
The company plans to have these experts speak at leading industry conferences and trade shows as well as right publications in leading journals rigor.
Regarding the effectiveness of our pathogen elimination product.
We plan to announce the details regarding this advisory board in the very near term.
Our global distribution of strategic partnership expansion continued throughout 2022 with the company now boasting several established strategic manufacturing partnerships and alliances.
With canon.
Acuity lighting Johnson controls you Sheila.
Siemens and Grainger. Additionally, our pathogen elimination segments Global network has grown to include 89 dealers and distributors in 52 countries, including Southeast Asia with 47 sales agencies as well as not having.
19 U S based sales personnel.
Our global customers will now have access to our complete suite of research back in.
And clinically proven best in class product, including Photocatalytic oxidation advanced UBC activated carbon.
Far UV technology utilizing newly developed 222 nanometer wavelength radiation as well as our new air monitoring and reporting software for use in smart building products.
We recently announced a significant <unk>.
Strategic manufacturing supply chain outsourcing agreement with Canon Virginia.
Our wholly owned subsidiary of Canon USA, one of the Premier Global advanced contract manufacturers there.
This agreement makes Ken on the Companys primary manufacturer.
And logistical partner for our entire suite of air purification solutions.
Our joint teams continue executing on an accelerated plan to completely transfer our manufacturing to canon during this current quarter.
We will simultaneously close our existing manufacturing and distribution operations, yielding a significant reduction in our fixed G&A.
We believe this partnership will translate into production and logistics cost savings or to accelerate development of our next generation product by removing manufacturing execution risk and allowing the company more effectively scale and focus on advanced technology development and marketing.
We've also recently expanded our relationship with Karen in Japan to include Karen in financial services.
As a partner, which allows our company to offer for the first time leasing and finance options for our product to our customers.
With the pure acquisition.
We are obtaining.
Pure net software application.
Which will further differentiate.
Our systems and those of our competitors.
Through the introduction of pure net proprietary.
Systems.
Our software will accelerate our industry differentiation by adding Iot integration throughout our entire product portfolio with proven software that continually monitors and reports indoor air quality throughout an entire facility.
Pure <unk> has recently been installed into almost 100 surgical suites.
P Rose H V AC system products.
Product allows us to competitively compete in one of the fastest growing hair pathogen elimination marketing markets excuse me offering complete systems.
With our proprietary air monitoring software, which is rapidly becoming.
They must have in HVA systems.
To conclude.
2023 will be a transformative and extremely positive year for <unk> now.
Now I would like to turn the call over to Brian Stern, President of pure lighting, allowing them to speak more about pure OLED supply Brian .
Thank you Matt This is Brian .
The CEO and cofounder of both Leds supply, Joe and pure life in my new role as President apparel lighting and board director allows me to consolidate integrate and create a uniform vision for air and surface disinfection technologies.
Which are made up of very solid scientific there, Linda Tsai and pure lighting.
Our goal is to use this merger to leverage cross selling opportunities and increased revenue per customer while also improving bottom line profitability for the division and the organization as a whole.
I am proud to share that our latest spike, which I co founded 14 years ago has greatly expanded its business and we now provide design services lighting in technology distribution and OEM product development after sales service and turnkey installations for new construction renovation and national account projects across the United States.
Our reach has also expanded from just lighting and controls to include building technologies, such as EV Chargers building automation systems, UV devices, and smart panels for low voltage irrigation gas and water metering.
Our customers range from large developers to national energy service contractors, as well as lighting and electrical circuits providers.
The merger with applied really allows us to realize many synergies with our business.
We're already enjoying the benefits of the merger as we have been able to start specifying moneywort smears.
Case goods.
On a multitude of different projects.
It has enabled us to provide our customers with a higher quality product with a better price points and improved gross margins for the company and we recently announced a major $4 5 million contract with the US companies the country's premier co living rental property developers that has over $1 billion in plant construction.
Moving onto the apparel lighting, which was formed in 2019 with emission of using white technologies to improve health and wellness within buildings.
Today sure lighting has been operating and encompasses pathogen elimination and disinfection.
These systems in Delta Air applications continues to air Disinfection technologies and surface Disinfection technologies, which are primarily sold into health care education commercial facilities and government spaces.
We expect to announce in the very near future that we have renewed our agreements with one of the leading distributors hospitals, expanding our reach into health care with our Purion <unk>, plus chemo, plus Piero protect systems, which utilized our UV technology.
With this agreement we also expect to announce that our pure on that particular, plus tricky part D. UV disinfection control systems.
Our scheduled to be installed in 2016 operating rooms at a leading medical school. This renewed agreement should help applaud you be achieved greater penetration of the Purion systems within the hospital segments serviced by this distributed.
Hospitals currently utilizing the pure on that system include mass General University of Chicago mode, and children's Mercy in Kansas City.
Carol has continued to expand our business partnerships with the newly announced research partnership with Johnson controls this year.
This partnership allows us to provide additional research on the safety and efficacy of our UV technology additions.
Additionally, we announced an expanded partnership with acuity brands to further expand our pure protect our unique portfolio of products.
Next I will turn the call over to Mike Riccio, Our Chief Financial Officer for a review of our financial results Mike.
Thanks, Brian .
Net sales of $20 1 million represented an increase of $8 5 million or 73% for the year ended December 31 2022.
As compared to net sales of $11 6 million for the prior year.
This improvement was primarily attributable to the hospitality segment with sales of $13 $6 million.
Representing an increase of $7 7 million or 130% as compared to the prior year.
This was largely due to the vision Mark asset acquisition in Brooklyn, accounting for $6 million of the increase was the increase in sales in the legacy <unk> business of one 7 billion.
The pathogen elimination and disinfection segment had sales of $6 5 million in 2022.
Which represented a 14% increase over the prior year.
The pathogen elimination and disinfection markets have not yet fully rebounded from the initial volume during the early stages of the Covid pandemic.
Additionally, due to macro market shifts the company saw a major global trends toward end to end system.
The entire facility that includes software monitoring capabilities.
Allows facilities implement standards in the current EPA clean the air initiatives and guidelines announced in early 2022. These.
These guidelines at the standards that are focused on improving indoor air quality, including indoor air ventilation and HVAC systems to all public places.
The shifting macro trends the company alter its marketing Emma.
M&A and R&D activities to address these changes.
The Bureau merger, coupled with the strategic manufacturing partnership with Canon further addresses this year.
Gross profit was $4.0 million, which is approximately 20% of sales for the year ended December 31, 2022, as compared to $4 1 million or approximately 35% of sales for the prior year.
Gross profit as a percentage of sales decreased primarily due to the higher sales mix of the hospitality segment.
The hospitality segment sales for the year ended December 31, 2022 were 68%.
Total as compared to 51% for the prior year.
Additionally, the hospitality segment gross profit as a percentage of sales decreased year over year, largely due to the completion of projects that were in process. When the company first acquired the assets of vision in Brooklyn, which is a nonrecurring condition.
The company is totally focused on streamlining both manufacturing and distribution operations across both segments.
SG&A costs were $14 8 million for the year ended December 31, 2022, which represented an increase of $3 5 million as compared to the prior year.
This increase was primarily driven by the asset acquisitions of vision Mark in Brooklyn in Bihar.
Hospitality segment in Q1, 2022, and the asset acquisitions of science and technology and scientific error in the pathogen elimination and disinfection segment at the end of Q3, and the beginning of Q4 and 2021.
As a result payroll and sales commission cost increased approximately $1 $5 million amortization.
Amortization costs increased approximately $1 million marketing increased approximately approximately zero point $4 million.
Rent and professional fees each increased approximately <unk> 5 million.
The company anticipates efficiency gains in the coming year as all three acquisitions have now been fully integrated and synergies are being realized.
The company has determined that a triggering event had occurred as a result of a settlement agreement with scientific air.
A quantitative impairment test on the goodwill determined that the fair value was below the carrying value and as a result of rig company. The company recorded a full noncash goodwill impairment charge of $1 $1 million on the consolidated statements of operations for the year ended December 31 2022.
We also evaluate a potential triggering events that might be indicators that other intangibles related to the scientific air were also impaired.
As a result of our analysis and additional noncash impairment of intangibles of $5 9 million.
Also recorded in the consolidated statements of operations for the year ended December 31 2022.
As a result of the scientific air settlement and the change in the values of the shares of stock returned to the company. The company recorded a net gain of $1 4 million in other income in the year ended December 31 2022.
Other income in the year ended December 31, 2022 also includes $205000 for the employee retention tax credit.
The company recorded a net loss of $16 6 million for the year ended December 31 2022.
Compared to a net loss of $7 4 million for the prior year.
This increase of $9 $2 million in the net loss was primarily due to the noncash loss on impairment of goodwill and intangibles of 7.0 million.
And an increase in SG&A costs of $3 5 million as previously as previously explained.
Loss per share for.
Per common share is $1 41 for 2022.
We exclude the impairment loss the loss per common share is <unk> 86.
Third to 86.
The loss of 86 in 2021, which is in line with the guidance given by a prominent investment banking research analyst.
With the integration of the pure merger rapidly progressing coupled with the shifting of our entire supply chain logistics offshore manufacturing and next generation product R&D to canon the savings and the reduction of duplicate expenses across all of our divisions is expected to equate to improvements in our SG&A driving.
Higher future earnings.
Lastly, I would like to talk about the company's efforts to strengthen liquidity.
On July one 2022, the company filed a $50 million shelf registration on form S, three which with the SEC, which allows for flexibility to raise funds as needed.
Italy in December 2022, the company entered into a loan and security agreement with Pinnacle Bank, which provides for a 5 million secured revolving credit facility.
At December 31, 2022, the company had approximately $2 7 million of unrestricted cash available on its consolidated balance sheet.
I will now turn the call back over to Max for closing remarks.
Well.
Thank you.
Oh.
Let me.
Let me just say that.
As the founder of applied UV.
And recently, taking on the role as the CEO .
I'm absolutely committed to our success.
2022 was a tough year for all of us.
But it was also a transformative year.
We will continue.
To focus on our strategic priorities, while at the same time tightening expenses across all of our businesses aligning our resources, including cash with current demand.
I am extremely optimistic about the outlook for both of our pathogen elimination and hospitality segments.
We now have a great portfolio of highly effective product.
Okay.
That management, our management team.
I.
Truly believe will be strong levers for growth in 2023.
Thank you again, everyone for joining our call today. This concludes our prepared remarks, the operator will open the call for questions.
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One moment, please while we pull for questions.
Thank you. Our first question is coming from Chip Moore with Es Hoffman you May proceed.
Hi, good morning, Thanks, Hey, everybody.
One wanted to aggregate first I guess on visibility comfort around that $45 million to $50 million top line goal.
I think Max I heard you talk about sort of our near term pipeline of $10 million for monarch vision market, we did mark any other sense of.
Pipeline for <unk> and some of the other parts of the business.
Well, Brian Stern, why don't you respond to the pipeline for Rob.
And then I can.
Talk a bit more about.
Why.
We're very comfortable about a $45 million to $50 million a year.
Sure.
So current pipelines for pure <unk>.
<unk> currently has roughly $500000 pipeline.
Yes.
The last quarter.
Ali do you roughly $4 million to $5 million pipeline.
With strong sales expectations for the remainder of the year for both the organization.
So we feel very confident in the numbers that are being portrayed.
And hopefully we'll be able to meet those goals this year.
Hey, chip.
The backlog.
Between all of our all of our businesses is in excess of.
15.
<unk>.
At the end of the first quarter last week.
We are.
We know what the.
Outlook is in the near term.
Because we're quoting.
A significant number of jobs and the.
The percentage of conversion of quotes.
The actual orders to actual receipts.
It gives us a great deal of comfort that.
We will hit that $45 million $45 million to $50 million.
Yes.
And we will.
There's even.
A reasonable expectation that we will exceed that.
We have a.
We have great expectation that there are several very large multimillion dollar projects that we've been working on throughout 2022 that we.
We will get actual Pos for this current quarter.
So I'm.
The metrics.
Backlog.
RF skus that were dealing with give us.
That comfort I hope I've answered your question.
No that's very helpful. Max I appreciate it.
And I guess around hospitality specifically.
I guess capacity there with Brooklyn, and then I think you talked about.
Getting through those lower margin orders.
Should we think about that margin ramp for hospitality I guess specifically.
Yes.
Over the next few quarters.
Throughout the year.
Prior to the pandemic monarch was running.
Margins in excess of.
In the low to mid <unk>, we expect to be back to those margin levels now that we've completed.
The projects that were undertaken.
During the acquisition of the Brooklyn facility, which as I explained 50.
50% of the proceeds.
We'll turn it over to the prior owners, which we didn't enjoy.
So the.
The.
Margins are.
I think a pretty a pretty much.
Established historically, but I will tell you the.
<unk>.
Problem, one that will have.
If we're going to exceed.
<unk>.
Forecast is a labor shortage.
And we're working diligently with with New York City.
Agencies to train at their expense.
Employees as much of this country has already experienced.
Getting.
Again getting decent.
Employees with some skills is really the challenge today it isn't the facility it isn't the $9 million worth of equipment.
We acquired with this facility, it's really it's really employees were on.
Overtime right now working on several large product projects.
We're just about to receive a <unk>.
$3 million to $4 million order from a European hotel developer for a major hotel refurbishment and rebranding in Washington D C.
So the challenge is going to be labor.
That machinery, not the facility not raw materials.
<unk>.
It's a problem that is solvable.
But.
It is an issue to deal.
In response to your question about where our capacity constraints.
Got it that's very helpful.
And then another one around the <unk>.
Mccann relationship.
This outsourcing agreement.
<unk> that this current quarter.
<unk> pretty much through it I guess the current quarter, but.
How to think about.
One time costs or double costs and things like that.
When that sort of normalizes.
Maybe Mike for you.
SG&A sort of implications there.
We've furloughed a significant number of employees in the legacy manufacturing business.
And kennesaw outside of Atlanta.
We have.
Very little duplicate SG&A because.
The contract with Carolyn.
Has them.
Invoicing and charging us at shipment so.
So we have a variable.
Cost structure, rather than a fixed cost structure.
Atlanta currently.
We're already seeing benefits and reduction of.
Payroll and other SG&A in Atlanta.
That's not.
And issue that.
He is going to be a negative.
Got it okay. Thanks Max.
And just one last one for me on sort of new product development I think you talked about going after that.
Shipping and essentially distribution center market more on the food spoilage side.
When should we think about that how are you going to attack that market.
Kennedy.
Well.
The.
To give you a very short.
Science answer.
Photocatalytic oxidation, which were probably leaders.
Likely leaders in that technology.
Because we.
Been running it for years.
It's the system that's in the.
International Space station and it was a science developed for NASA removes ethylene from the air.
And it removes ethylene from the air.
Aerosol product removes ethylene from the year utilizing photocatalytic oxidation.
Helene happens to be the chemical in the.
In the air.
<unk>.
Accelerates food spoilage.
So photocatalytic oxidation removes ethylene very effectively and convert it to water vapor and C. O two which are both naturally occurring in the in the atmosphere.
So our systems when they're in a refrigerated truck or in our refrigerated sea container, bringing fruit.
Berry's flowers from South and Central America, and even from California to the East Coast.
Removes ethylene.
Significantly increases the shelf life.
Valuable post harvest product <unk>.
Proven science, we're working with canon.
Two two.
Sure.
<unk> had to see containers delivered to the <unk>.
Counting.
In Virginia.
We're working on installing our systems in order to show.
Large sea container companies such as Maersk.
Is that.
Our system will significantly reduce spoilage up there.
Currently responsible for transport.
Transport.
High value post harvest product, we're doing a side by side video with or without our system.
Our system in one container.
And nothing in the other container.
Both will be loaded with berries in bananas and other high value.
Fruit and vegetables.
So what happens over.
An average four to five day transit time.
In each of those containers, we know from existing science.
So and that's been proven in laboratories and tests at the University of California, Davis and in <unk>.
Videos that are available on Youtube partners really company was working on the same.
Issue, but theyre dealing with packaging, which we're not.
Shows that.
The video specifically that I'm referencing that bananas term.
Dark Brown and four days in transit.
Without.
Photo Act Photocatalytic oxidation.
And will last over eight to 10 days with it. So we know the science is there.
To prove it.
Bring it to the large shipping container companies del Monte for example is already installed our systems and a 2 million square foot refrigerated warehouse.
In Atlanta.
Where they bring.
Our food in from the West coast for redistribution.
Uh huh.
Yes.
It turns out to be applying of kennan. So we've got an entre to that introduction.
Interesting that's helpful Max and maybe if I could sneak one last one.
Around sort of sales synergies from the recent deals. Thank you.
Talk about numbers.
It's getting some traction.
Outside of the traditional brookdale market be that relationship is that.
How do you see that synergy opportunity and is that potentially additive to that outlook or is that contemplated within there.
It's not in our numbers yet.
You're referring to the inclusion of Aero side into.
Guestroom furniture show that.
The hotel.
So.
Pure air.
Our room.
With the best Science is that what you're referring to you anything that you said that and also just the ones Youre seeing now in terms of pull through on works.
As well into some of the newer channels.
That's an obvious one.
The more near term and the one that we've already.
Scene purchase orders for <unk>.
Supply has received as Brian Stern mentioned.
$4 $5 million in orders for it systems included in that order.
He is the first of at least four.
Projects that PURA has paper on the first one alone is five.
Involves one works is for about just in excess of $500000.
Worth of are backlit hotel there was.
To the multifamily.
Development.
Definitely.
Purchase orders for <unk> is currently not in the multifamily space, but recently we've received.
Almost $600000 order from the related companies, which is the largest real estate developer in the country.
Uh huh.
Medicine, cabinets, which we make which we manufacture.
Electrified generic medicine cabinets that not only act as mirrors, but as lighting and and obviously, it's medicine cabinets.
L. A D is bringing to us is their extensive relationship with multifamily.
Rental and multifamily condo developers.
Much supply.
Vanity.
And the medicine cabinet in every apartment if not several.
So we're now seeing.
We're seeing business coming from that direction, none of which existed prior to last quarter.
That's great.
Okay I appreciate all that color I'll take the rest of mine offline. Thanks.
Thank you.
Once again, ladies and gentlemen, if you have any remaining questions or comments. Please press star one on your phone at this time.
Okay.
There are no further questions in queue at this time I will turn the call back over to management for closing remarks.
Well I think I think we've made are optimistic.
Statements.
Clear.
I wanted to thank everyone for supporting our company and we're looking forward to a very successful 2023.
Thank you this.
This concludes today's conference and you may disconnect your lines at this time and we thank you for your participation.