Good day, ladies and gentlemen. And welcome to Daktronics Fiscal Year 2023 Third Quarter Earnings Conference Call. As a reminder, this conference is being recorded today, Wednesday, March 8, 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, Michelle. Good morning, everyone. Thank you for participating in our third quarter earnings conference call. I would like to review our disclosures, cautioning investors and participants that in addition to statements of historical facts, we will be 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 may be out of our control and may cause actual results to differ materially. Such risks include, but not limited to, our ability to obtain additional financing on terms favorable to us or at all, changes in economic conditions, changes in the competitive and market landscape, including impacts of global trade discussions and policies. The impacts of governmental laws, regulations and orders, including those resulting from pandemics, disruptions to our business caused by geopolitical events, military actions, work stoppages, natural disasters or international health emergencies such as the COVID-⁠19 pandemic. Any future goodwill impairment charges, management of growth, timing and magnitude of future contracts, fluctuations of margins, availability of raw materials, components and shipping services, the introduction of new products and technologies, and other important factors. These identified important factors could cause actual results to differ materially from those disclosed in this call in the company's third quarter 2023 earnings release and its most annual report on Form 10-K. We refer you to these documents. Our third quarter 2023 earnings release contains certain non- GAAP financial measures and was furnished to the SEC, Securities and Exchange Commission on a Form 8-K this morning and is available on the Investors section at the Daktronics website at www.daktronics.com. I'll turn the call over to our CEO, Reece Kurtenbach.

Thanks, Sheila. Good morning. Thank you for joining us today. Our past actions to carefully match our production schedules, inventory and labor to demand fulfillment were successful as measured by the increase in sales and generation of operating income for the third quarter. The pandemic recovery period was unprecedented. The last 24 months were marked by historically high demand while experiencing persistent instability of supply chains, a tight labor market and inflationary conditions. We are seeing supply chain conditions easing, which supports a more stable production schedule. We have also increased production capacity to match market demand, which was achieved despite labor shortages and long cycle times for the technology and fixed assets necessary to increase output on an ROI positive basis. Operating margin improvement was achieved because of a more stable environment. Pricing actions that we took in light of supply chain conditions and inflationary pressures, product mix adjustments and prudent management of operating expenses. Quoting activity and sales opportunities remain active, resulting in an order volume of $148 million for the quarter. Fiscal year ’22’s level levels were partially attributed to pent-up demand. As a comparison, orders for the fiscal 2023 third quarter, the last quarter prior to the onset of the pandemic were $135 million. During the past quarter, our team focused on our liquidity enhancement program and working capital improvements, as evidenced by the lowering of inventory levels and their attention to billings and collections of accounts receivable and deposits. I appreciate the efforts of our teams across the company have made to come together to solve these challenges and to serve our customers. I'll now turn it over to Sheila for some more details on the financial results.

Thank you, Reece. As Reece mentioned, we experienced higher stability in our fulfillment areas in the third quarter after experiencing a challenging first half of the year. Operating income was $7.1 million, or 3.8% of sales or using adjusted operating income, we generated $11.7 million, or 6.3% of adjusted operating margin, during the third quarter of fiscal 2023. Net sales for the third quarter of fiscal 2023 increased by 32.5% to $185 million compared to $140 million for the third quarter of fiscal 2022. The $463 million of backlog coming into the quarter, coupled with easing in the supply chain, supported production stability in the third quarter's record level of net sales. Orders for the third quarter of fiscal 2023 decreased 30.9% as compared to the third quarter of fiscal 2022. As Reece noted, order volume levels declined after a record number of orders in fiscal 2022, driven from pent-up demand coming out of the Pandemic shutdown and because of timing differences in bookings of large projects. This high demand coupled with supply chain challenges, led to historically high backlog, creating much longer lead times which impacted order levels. At the same time, we utilize this opportunity to be selective in addressing demand, and so we prioritize our focus on winning only the most profitable opportunities. In addition, our International Business Unit orders were lower due to the softening market caused by exchange rates and geopolitical conditions in various regions. As a result of the relationship between past order bookings and the realization of sales, product order backlog remains historically high at $429 million at the end of the third quarter. Gross profit as a percentage of net sales was 22.6% for the third quarter of fiscal 2023, as compared to 16% a year earlier. The increase in gross profit…

Thank you, Sheila. As we emerge from the uncertainty of the pandemic and its response, we expect greater stability in our production and overall business. We began FY23 Q4 with a $429.1 million backlog and we'll enter FY24 with a backlog that is unusually large for Daktronics, which will provide consistent use of our factory capacities. We are still focused on reducing backlog to improve lead times, which we believe will have a positive demand generation effect in most of our business areas. In addition, we continue to selectively and carefully price projects and manage costs in all areas. Supply chains have been stabilizing which will allow us to reduce our component inventory levels in the coming months as our production levels continue to increase and we're able to purchase less safety stock. Our capacity to fulfill manufacturing and services work is dependent on plant automation and people. We have invested heavily in both areas over the past 24 months. Have many of our automation projects complete and are close to our desired staffing levels in most areas. We expect to complete the remaining factory automation projects by the end of fiscal year ’24, Q1. These were delayed due to equipment lead times and are focused on increasing staffing levels at certain factories and in our technical services areas. We believe these investments will carry us through expected demand growth through FY24 and possibly into FY25. The world has seen a lot of change over the past two years, and Daktronics has navigated this as a recognized industry leader in quality, technology and reliability. Now, in our 55th year of operation, customers continue to choose Daktronics as demonstrated by our strong order volume and backlog. We do not believe that the geopolitical situation is back to normal, but we do…

[Operator Instructions] : :

I am showing no questions at this time. And I would like to turn the conference back over to Reece Kurtenbach for any closing remarks.

Well, I'd like to thank everybody for attending today's conference call. We will see you in a few months as we have our next call to announce our yearend results. And I wish you all a happy spring.

This concludes today's conference call. Thank you for participating. You may now disconnect.