Good day, ladies and gentlemen and welcome to the Daktronics Fiscal Year 2020 First Quarter Earnings Results Conference Call. As a reminder, this conference call is being recorded today, Wednesday, August 28, 2019 and is available on the company’s website at www.daktronics.com. [Operator Instructions] I would now like to turn the conference over to Ms. Sheila Anderson, Chief Financial Officer for Daktronics for some introductory remarks. Please go ahead, Sheila.

Thank you, Scalar. Good morning, everyone. Thank you for participating in our first quarter earnings conference call. I would like to review our disclosure cautioning investors and participants that in addition to statements of historical facts, we will be disclosing and discussing forward-looking statements reflecting our expectations and plans about our future financial performance and future business opportunities. All forward-looking statements involve risks and uncertainties, which maybe out of our control and may cause actual results to differ materially. Such risks include changes in economic conditions; changes in the competitive and market landscape, including impacts of global trade discussions and policies; management of growth; timing and magnitude of future orders and contracts; fluctuations of margins; the introduction of new products and technologies; and other important factors as noted and detailed in our 10-K and 10-Q SEC filings. With that, let me highlight some of the financials for the first quarter of 2020 and the related comparisons to fiscal 2019 first quarter. Fiscal 2020 is a 53-week year and fiscal 2019 was a 52-week year. The extra week of fiscal 2020 fell within the first quarter, resulting in a 14-week versus a 13-week quarter comparison. Sales orders and all areas of operating expenses were impacted by this additional week. Orders are up 17.5% when compared to last year’s first quarter. Orders increased in Live Events, international and commercial business units, decrease in high school park and recreation business units and were relatively flat in the transportation areas. For comparisons, orders paced at $13.4 million per week in fiscal 2020 as compared to $12.3 million during the same time last year or around a 9% increase using this comparison. Each business unit was impacted by that additional week in fiscal 2020. Live Events orders led the increase primarily due to the number…

Thank you, Sheila. Good morning, everyone. As Sheila highlighted, we had a strong start to fiscal 2020. Our teams across the Company worked to serve our customers, which translated into top line and bottom line performance in the first quarter. We’re historically busy at these times as the first half of our fiscal year has many of our sports customers installing facility upgrades or enhancements and this is also the construction season in the northern hemisphere and much of the world uses this time to install outdoor applications before the winter months. As a result of our increased investments and development over the past few years, we have broadened our offerings to customers. Solutions like our Narrow Pixel Pitch displays are being adopted by new and existing customers around the world. Especially for these new indoor product lines, we continue to explore and develop new channels to sell through, often with integrators that can incorporate our products into locations like corporate offices, control centers and retail stores. Our control offerings have also been enhanced, creating demand for both control system upgrades and new system purchases. We have been successful around the globe. We continue to see buyers interested in making decisions to invest in our solutions even while economic concerns linger. Like many other companies, we are in the midst of a dynamic and volatile global trade environment. Today we are most impacted by the China and United States administration measures to impose import tariffs and the current rhetoric on where to do business. We continue to monitor and evaluate this situation from multiple perspectives and we will continue to adjust our sourcing and production methodologies to minimize impact to our customers and to Daktronics, while providing high quality, high valued solutions at a competitive price. However, in our current…

[Operator Instructions] And our first question comes from Greg Pendy with Sidoti. Your line is now open.

I just wanted to – I think in the quarter you said the tariffs were at $1.8 million impact and you’re expecting a $10 million impact throughout this year. So just – can you help us understand the timing of where there might be some step ups throughout the year, maybe more tariffs coming through and how we should be thinking about that? Because it seems like given a $10 million impact, you’re expecting it to increase a little bit throughout the year.

There was just a recent announcement that there would be a bit of an increase, so there was that – create some of that increase to the $10 million. And then it also goes along with when we utilize the inventory. So there’s some tariff pop-up in our inventory at this moment that we’ll use in future quarters.

Got it. Thanks. And then just moving on – just wondering, you know, I think in the guidance for next quarter, you kind of mentioned you’re expecting revenue to be up slightly. Just trying to understand the Live Events because it looked very strong in this quarter you’re thinking it kind of balances out throughout the year, I take it. And can you just kind of give us a little bit of color, it was helpful that you pointed out the Cincinnati Reds, the [indiscernible] but just trying to understand a little bit maybe of what you’re seeing environment wise and maybe the NFL, given the attendance problems maybe a few years back and whether people are more comfortable in some of the professional sports attendance trends?

We continue to see an investment by sports teams across the board in improving the in-venue experience, not just in the bowl, but in all different spaces associated with today’s modern sports venues. We believe that investment will continue to happen in the NFL and the other pro teams and that without a big stadium construction, that investment tends to be upgrades or enhancements, which are more difficult to predict in time because a customer can choose to do it this season or next season and on their personal schedules and other priorities.

Great, that’s helpful. Thanks a lot.

Alright, next question.

[Operator Instructions] Our next question comes from Lisa Springer with Singular Research. Your line is now open.

Thank you. And congratulations on a good quarter by the way.

Thank you.

I wanted to – could you give us a little bit more color around the surge in orders for the International segment and how soon do you think you’re going to recognize the revenues from those orders?

I think the International business has its ups and downs, but we continue to grow overall and our presence has been continuing to build over the years as far as the timing of when the business will turn to the sales.

I think in the next two to three quarters, mostly projects that will finish out in the relatively near term here.

Okay. And just in general, in a given quarter, what percentage of your sales are from replacement sales and what percentage would be new customers and new installations?

Lisa, I don’t know if we have a number at our fingertips, and it would vary a lot from year-to-year depending on construction cycles. We don’t keep figures like that. I will say that in North America, especially almost every major team from a college, minor league has some type of video system and so when they choose to upgrade that – really you could consider that a replacement and so then some parts of our business – the whole thing is almost some type of upgrade or replacement outside of new.

And what would be the typical replacement cycle for a college or professional sports board?

A nominal 10-year replacement cycle for most of what we do is a rule of thumb but not everything [correlates][ph] with that.

Okay, thank you.

No worries.

And at this time, I’m showing no further questions, I’d like to turn the call back over to Reece for any closing remarks.

I would like to thank everybody for attending the call today. For those of you in the U.S., I wish you a great three day end of summer holiday. I look forward to talking to all of you in a few months.

Ladies and gentlemen, thank you for your participation in today’s conference. This does conclude the program. You may now disconnect everyone have a great day.