Good morning. My name is Chelsea, and I will be your conference operator today. At this time, I would like to welcome you to the Optical Cable Corporation Fourth Quarter and Fiscal Year 2022 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer period. [Operator Instructions] Mr. Palash, you may begin your conference.

Thank you, Chelsea. Good morning, and thank you all for participating on Optical Cable Corporation's fourth quarter and fiscal year 2022 conference call. By this time, everyone should have a copy of the earnings press release issued earlier today. You can also visit www.occfiber.com for a copy. On the call with us today are Neil Wilkin, President and Chief Executive Officer of OCC; and Tracy Smith, Senior Vice President and Chief Financial Officer. Before we begin, I'd like to remind everyone that this call may contain forward-looking statements that involve risks and uncertainties. The actual future results of Optical Cable Corporation may differ materially due to a number of factors and risks, including, but not limited to, those factors referenced in the forward-looking statements section of this morning’s press release. These cautionary statements apply to the contents of the Internet webcast on www.occfiber.com as well as today's call. With that, I will turn the call over to Neil Wilkin. Neil, please begin.

Thank you, Aaron, and good morning, everyone. I will begin the call today with a few opening remarks. Tracy will then review the fourth quarter and full-year results for the three-month and 12-month periods ending October 31, 2022, and some additional detail. After Tracy's remarks, we will answer as many of your questions as we can. As is our normal practice, we only take questions from analysts and institutional investors during the Q&A session. However, we also offer other shareholders the opportunity to submit questions in advance of our earnings call. Instructions regarding such submissions are included in our press release announcing the date and time of our call today. In fiscal year 2022, our OCC team executed well in an evolving marketplace, focusing on initiatives to grow and demonstrating OCC's strength and resilience in the process. I'm pleased to report that our net sales and results from operating activities significantly improved during every quarter of fiscal year 2022 compared to the respective prior year periods. Our sales and production volumes grew even as we experienced the lingering direct and indirect impacts of the COVID-19 pandemic on our supply chain, including the availability of materials, increased lead times and increased costs and labor constraints, including recruitment of sufficient production personnel and increased costs. We are particularly pleased with our strong finish to the fiscal year and the results we achieved during the fourth quarter of fiscal 2022. Specifically, we delivered double-digit percentage growth in net sales and gross profit, the highest gross profit margin of any quarter of fiscal 2022, and net income of $1.2 million or $0.15 a share. I'm incredibly grateful for the OCC team members and their dedication and tireless efforts this past year, the resilience, perseverance and hard work have enabled OCC to successfully navigate unique…

Thank you, Neil. Consolidated net sales for fiscal 2022 increased 16.8% to $69.1 million compared to net sales of $59.1 million for fiscal year 2021. Consolidated net sales for the fourth quarter of fiscal 2022 increased 26.3% to $20.1 million compared to net sales of $15.9 million for the same period last year. We experienced an increase in net sales in both the enterprise and specialty markets, including the wireless carrier market during the fourth quarter and fiscal year 2022 compared to the same periods last year. We believe the increase in net sales is primarily due to both increased demand for our product and increased production throughput as well as increases in product pricing taking effect for new orders. During fiscal year 2022, we continue to see product demand and sales and production volume increase compared to fiscal year 2021. Our sales order backlog and forward load has been approximately 3x to 4x higher than typical levels throughout the fiscal year as product demand continues to be robust. Our sales order backlog and forward load exceeded $12 million at the end of fiscal year 2022 and is a bit higher since the end of the fiscal year, exceeding $14 million. At the same time, we believe continuing and lingering direct and indirect impacts of the COVID-19 pandemic have created challenges that have affected production volumes and sales despite increased demand. Our production volumes continue to be tempered during fiscal year 2022 as we continue to experience supply chain challenges for certain raw materials as well as challenges recruiting additional personnel. Turning to gross profit. Our gross profit increased 26% to $20.5 million in fiscal 2022 compared to gross profit of $16.3 million in fiscal 2021. Gross profit margin increased to 29.7% in fiscal 2022 compared to 27.5% in fiscal…

Thank you, Tracy. And now if any analysts and institutional investors have any questions, we are happy to answer them. Chelsea, if you could please indicate the instructions for our participants to call in any questions they may have, I would appreciate it. Again, we are only taking live questions from analysts and institutional investors.

[Operator Instructions] All right. Our first question will come from Michael Jones with WCM Global Wealth. Your line is open.

Hi. Good morning. Can you spend some time trying to quantify or help us quantify what the price increases were or what you expect price increases to be whether it be by segment or product lines? And also how much of the revenue growth was price versus unit volume? I missed the first couple of minutes of the call, so if you can cover that, I apologize, but I would like to hear the answer.

Sure. I appreciate the question. We don't give specifics about our price increases other than what we announced in the industry. We made a couple of price increases sort of in mid-year, but they weren't really taking effect until later in the year. Most of it mostly impacted the fourth quarter. I don't believe that, that significantly increased our sales dollar numbers. The price increases vary depending on product type and what we were seeing from a material standpoint. And we're really based on making sure we're recovering that cost. And I think that really is the best I can tell you. I don't have a percentage saying that this is what the exact impact was on sales and we didn't see it as significant during the year.

Are you getting much pushback on price? And do you think you're ahead or behind on price at this point, at least in general?

We believe we're right where we need to be, and we have not been receiving pushback on price.

Okay.

I think typically, in our industry, people have been able to – have needed to and are able to increase the prices to recover the increased costs that have been occurring within the supply chain.

So is there still a lot of inventory that needs to be repriced as it goes out. So there will be some excess margin there?

Not really. I mean what happened during the year was we were seeing demand and getting backlogs. We also had some challenges in supply chain and getting materials. We did our best to try to get the materials in as we could, but not really at any continually increasing price. I mean, the prices were increasing as we are buying them, but I don't see those prices continuing to increase, at least at the moment. And so while we've increased our raw materials a bit and you'll see that in our Form 10-K in the annual report that will be filed later, that's not – we don't have a lot of sort of built-in profit sitting or unusual profit sitting in the materials we have on hand. I would not describe it that way. We've also been focusing on trying to make sure we're keeping up with the demand we have been experiencing, which is the part of the reason why our backlog has been – backlog sales orders have been higher than unusual all during the year.

What's the current book-to-bill?

I'm sorry, what?

The book-to-bill as far as bookings over sales?

I don't have that precise percentage, but we've described what the dollar number is in our filing that we're making later today. So you can see that described in the MD&A.

Okay. Will there be any opportunity to follow-up on that once it is filed, if we have further questions, your Investor Relations effort is quite poor at the least. So trying to have some contact or some insight on follow-up questions would be helpful. Any thoughts on that?

If you – we work through our Investor Relations firm. I think that they've done a good job. I think we're – we try to be as responsive as we can to shareholders. We're also very careful to make sure we're complying with the Reg FD and not disclosing something to one shareholder that we're not making public to others. So we can generally...

That's totally understandable. But there seems to be no effort to contact shareholders. I don't know if you talked at [indiscernible] or not, but getting information or responses even as a – even if you said, don't – I can't talk to you, that would be helpful, but I get nothing from the IR firm or from you, it’s frustrating to say the least as a shareholder. On the other side is what's the...

I apologize for that, and we're happy to do better to return your call. I didn't think that we were – had a call from you that hadn't been returned, but my apologies.

Okay. I appreciate that. What's the draw on the revolver currently?

That will be disclosed in our – everything that we can disclose about that is disclosed in our annual report, which will be disclosed and filed later, hopefully, today.

All right. Thank you. [Operator Instructions] All right. We have no more questions via the telephone. I'd like to turn it back over to Neil.

Thank you, Chelsea. I appreciate it. I would like to thank everyone for listening to our fourth quarter and fiscal year 2022 conference call today. As always, we appreciate your time and your interest in Optical Cable Corporation. We hope everyone has a safe and happy holiday season. Thank you.

Thank you, ladies and gentlemen. This does conclude today's conference, and we appreciate your participation. You may disconnect at any time.