Blonder Tongue Laboratories, Inc. (BDR) on Q4 2021 Results - Earnings Call Transcript
Operator: Good day, ladies and gentlemen, and welcome to the Blonder Tongue Laboratories Fourth Quarter and Full Year 2021 Earnings Call. At this time, all participants have been placed on a listen-only mode and the floor will be open for questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Ted Grauch. Sir, the floor is yours.
Ted Grauch: Thank you very much. Hi. Good morning, everyone, and thank you for joining us and participating in Blonder Tongue Laboratories 2021 fourth quarter and full year earnings call. I'm Ted Grauch, President and Chief Executive Officer of the company. As we give our remarks this morning, we will be discussing certain subjects that will contain forward-looking statements, including management's view of our prospects and evolving trends in the market. As you know, the future is all but impossible to predict, and so I caution you that actual results may differ materially from those that may be projected in our comments. We would ask you to refer to our prior SEC filings, including our Form 10-K for years 2019 and 2020 and our filed Form 10-Qs for the first 3 quarters of 2020 and for the first 3 quarters of 2021, as well as our upcoming 10-K for the year ended December 31, 2021, which also includes information about our Q4 2020 results and 2021 results. Each of those filings include additional information concerning factors that could cause actual results to differ from the information discussed this morning. With me today are Steven Shea, our Chairman of the Board of Blonder Tongue Laboratories; and Eric Skolnik, our Chief Financial Officer and Senior Vice President. Eric's remarks will follow mine and will cover our detailed financial results. All of us will be available to answer questions that you may have during the Q&A session immediately following our prepared remarks. For our 2021 full year results, the company is able to announce a small but positive net income of $84,000, compared with a net loss of $7.47 million for the full year of 2020. The change in year-on-year performance came from a combination of our continued work in progress on operating efficiencies and improved higher technology product mix that improved our blended gross, product gross margins and the recognition of significant non-operating income in 2021. The sources of our non-operating income were from the company's qualification for the Federal ERTC program in 2021 and the forgiveness of our 2020 Paycheck Protection Program loan that occurred in mid-2021. As discussed on previous quarterly earnings calls, both the Federal ERTC and PPP programs were associated with pandemic relief. Our improved product mix yielded a blended gross margin -- excuse me, a blended product gross margin improvement in 2021 of 39.8% versus 30% in 2020. And our operated -- our continued operating efficiency work has yielded a 23% reduction over the last 2 years when comparing January 2020 versus January 2022 monthly operating expenses. In the fourth quarter of 2021, the company experienced product delivery challenges caused by semiconductor supply chain shortages, with delays, price increases and batch size uncertainties growing throughout the quarter. Our 2021 fourth quarter sales decreased by 7.7% to $3.993 million from $4.327 million in the fourth quarter of 2020. And our net loss for the fourth quarter was $927,000 compared with a net loss of $2.413 million in the same quarter for 2020. Although the quarter was a relative improvement year-on-year, it was not in line with our average performance during the first 3 quarters of last year. In particular, the company had to engage in a series of price increases in an effort to compensate for a very fast-moving environment of rising raw material costs throughout the quarter. Conversely, the company saw a continued positive movement in project demand, in our more advanced technology products and that had begun during the third quarter of 2021 and was discussed in our third quarter earnings call. Those included demand for our NXG IP video processing products, our Clearview encoder and transcoder product lines and our Aircaster professional off-air receiver products. This pickup in market demand ultimately led to a year ending product backlog of approximately $10.2 million on December 31. On the product front, the company completed and released into production a total of 14 new products and product derivatives during the full year of 2021. We've most recently announced our TiVo-specific NXG platform configuration and our TiVo hospitality market sales partnership, as well as Blonder Tongue Laboratory selection and product certification by DIRECTV for our Clearview 4:2 IP video transcoder product line. That announcement included our clear -- also includes our Clearview 4:2 high definition, our standard definition products, as well as our 24-channel and 12-channel versions of those products, as well as those products also being qualified for DIRECTV's equipment subsidy program that they have for the dealers. As the company is entering 2022, we have continued to see improving market demand in a number of areas. So far, that has been an improving hospitality sector, increased demand for our high-speed data products and a continued positive trend in demand for our latest most modern and highest technology video processing, encoding and transcoding NXG and Clearview product lines. Our biggest challenges have continued from the fourth quarter into early 2022. And at this time, supply chain issues are expected to be the primary driver of uncertainty in our 2022 financial performance. Now, I would like to pass things over to Eric Skolnik, our Chief Financial Officer, to cover our detailed financial results. Eric?
Eric Skolnik: Thanks, Ted. Our net sales decreased $334,000 or 7.7% to $3,993,000 for the fourth quarter of '21 from $4.327 million for the comparable period in '20. The net loss for the 3 months ended December 31, 2021, was a loss of $927,000 or a $0.07 loss per share compared to a loss of $2.413 million or $0.23 loss per share for the comparable period in 2020. The decrease in sales is primarily attributable to a decrease in sales of CPE products, DOCSIS data products, analog modulation products and coax distribution products, offset in part by an increase in IP video encoder transcoder products at our next-gen IP video signal processing series of products. Sales of CPE products were $23,000 and $1,114,000. DOCSIS data products were $122,000 and $418,000. Analog modulation products were $133,000 and $438,000. Coax distribution products were $171,000 and $287,000. Video encoder transcoder products were $2.529 million and $1.381 million. And our next-gen series products were $614,000 and $135,000 in the fourth quarter of 2021 and 2020, respectively. For the year ended December 31, 2021, our net sales decreased $625,000 or 3.8% to $15.754 million in 2021 from $16.379 million in 2020. Our net earnings for the 12 months ended December 31, 2021, were $84,000 or $0.02 per share -- diluted share, excuse me, compared to a net loss of $7.474 million or a loss of $0.76 per share for the comparable period in 2020. The decrease in sales is primarily attributable to a decrease in sales of CPE products, DOCSIS data products, analog modulation products and coax distribution products, offset in part by an increase in IP video encoder, transcoder products and next-gen IP video signal processing products. Sales of CPE products were $1.120 million and $4.165 million. DOCSIS data products were $755,000 and $2.184 million. Analog modulation products were $790,000 and $1.274 million. Coax distribution products were $1.266 million and $1.603 million. Video encoder transcoder products were $7.863 million and $4.245 million. And our next-gen series products were $1.924 million and $705,000 in 2021 and 2020, respectively. The company experienced a reduction in CPE products during 2021 due to the deemphasis of this product line, which the company expects to continue into 2022. The company experienced a reduction in DOCSIS data products due to reduced demand caused by the pandemic on these products that are used in the hospitality and assisted living environments. The company expects sales of these products to improve during 2022. The company experienced the reduction in analog modulation products due to the continued market shift away from analog modulation solutions. The company experienced a reduction in coax distribution products due to the reduced demand for legacy products. The company expects the sales of analog modulation and coax distribution products to continue to decline in 2022. The company experienced an increase in video encoder transcoder products and next-gen products, as these product lines represent newer products with advanced technologies and higher demand from customers. The company expects sales of these product lines to remain at 2021 levels or increase in 2022 depending on conditions in the semiconductor supply chain. Although the company does not expect overall sales to return to pre-pandemic levels during 2022, the company does expect overall sales to be higher during 2022 due to approximately $10.240 million of sales backlog at December 31, 2021. The company's primary sources of liquidity have been its existing cash balances, cash generated from operations, amounts available under our MidCap Business Credit LLC revolving credit facility, which is the MidCap facility, amounts available under our subordinated loan facility and cash generated from sales of our common stock, as well as funds made available to the company through participation and several federally-funded financial assistance programs implemented, pursuant to the Coronavirus Aid Relief and Economic Security Act, including the Paycheck Protection Program and the employee retention tax credit. On a go-forward basis, the company expects its primary sources of liquidity will be its existing cash balances, cash generated from operations and amounts available under the Midcap facility. The company also may seek to raise additional capital through the issuance of shares of common stock or other securities convertible into or exercisable for shares of common stock, although the company cannot provide any assurances that this type of additional financing, will it be available on reasonable terms at or at all. During 2021, the company received approximately $700,000 under the subordinated loan facility and approximately $492,000 in net proceeds from sales of common stock. Our ability to continue as a going concern is dependent upon our becoming profitable in the future and having assets is sufficient capital to execute our business plan and to meet our payment obligations on our debt financing agreements and other financial obligations when they come due. The company had approximately $92,000 and approximately $609,000 available for borrowing under the MidCap facility as of December 31, 2021 and 2020, respectively. The company's annual report on Form 10-K, which is being filed today, includes an explanatory paragraph going concern from its independent registered public accounting firm. Although the company has actively taken steps to address operating expenses and liquidity, there could be no assurances that these actions and others that the company intends to take in the future will be sufficient to address the concerns relating to the explanatory paragraph going concern. Now, I'd like to turn the call over to the question-and-answer session.
Operator: . Our first question comes from . When the floor is turned over to you, please state your affiliation and pose your question.
Unidentified Analyst: Good morning. As you all know, I'm a private investor. Could you elaborate a bit on the supply chain and how you're managing those issues?
Ted Grauch: Sure. Since -- just before -- shortly before the beginning of Q4, we started to receive a number of notices sort of one-by-one from different major suppliers, all of which were associated with parts that we had had an order for at least a year under contractual commitments, et cetera. But as everybody in the electronics industry globally have been seeing, we're just faced with some unprecedented situations with our suppliers not being able to supply products because of their suppliers, and it's been sort of running down through suppliers of our raw materials. The way we've been managing through it is -- actually, before I jump into that, I do want to kind of paint a broader picture of where the problems are coming from and how they've been shifting over the last, roughly, 6 months or so. The problems initiated with the largest sort of highest technology system on chip, very advanced microprocessor products, price increases on memory and a broad set of other sort of higher technology problems. Although those have persisted, we have seen some significant improvements in that class of semiconductor. Some of which we were able to resolve relatively quickly through combinations of negotiations, certain relative priorities with our suppliers, cutting back on quantities in exchange for guarantees of a smaller quantity, et cetera, et cetera. So lots of detailed work on that, that started back in late August, September last year. As the quarter -- as the fourth quarter progressed, we saw the problems start shifting to smaller parts, unusual parts that would normally not have any problems whatsoever, things like crystals and power conditioning, semiconductors and delays in PCBs because of shortages of copper in Southern China. I mean all sorts of different things that were kind of coming out of the blue. Those are the kinds of issues that have been persistent through Q1 as well. So it's really a mixed bag, wherein, in terms of how we're dealing with it, every notification in every conversation that we have with our suppliers in these areas tends to be a little bit different, because the impacts are different. They impact -- we've never had a single notice just, completely impact our entire product line. It's simply a matter of, we have a problem with one part, it might have -- that might cause a problem with us producing 1 product or 2 products or 3 products or 1 product in several product derivatives. And so we basically just set up the problem, figure out how to attack it, attack it, solve it, move on. In some cases, we've been able to find alternative replacements for the products -- sorry, for the raw materials that have shortages, in which case they either just go right back on to the current design and we keep producing with, say, a 2- or 3-week delay, for example, that there's been a lot of that. That seems to be generally the bulk of what we've seen. There have been other situations where the alternative parts that we found that are available will require small, very fast board spins, as we call them. So the design doesn't fundamentally change, but we've changed a very, very extremely small part of the design to accommodate that alternative part. We get those new boards into the QA, do the testing, and we're back in business in, say, 6, 7, 8 weeks kind of a timeframe. In some cases, there aren't alternative parts and we've had some situations where a product was not able to be produced for sort of in the 9- to 10-week range. So that's been the general sort of scope and scale of what we've seen. So it's very bad news for us, of course. Q4 was significantly impacted, as we've already told you. The good news is if you look at the glass half full kind of view of it, we've certainly seen some of our competitors and other sectors in the electronics industry where products have been delayed 6 months and 7 months and 8 months and 10 months. And we have not -- we've been able to manage through our problems with a lot less impact in our delay in shipping of products thus far. As I touched on already, the larger, more high-technology products that we have, the initial problems with, we're seeing very significant positive movement in those supplies in general, but we remain very, very cautious because we're really in a situation here where we keep being surprised every week or 2 of something else. We figure out what the problem is, where the problem is coming from, we try to solve it in the situation that's associated with that particular product, either to work around it, find alternate supplies. In some cases, we've had to move to parts -- semiconductor parts brokers in different parts of the world that we would not normally deal with. We had general luck and success with those activities, finding alternate sources, we've moved to alternate parts and in some cases, as I already pointed out, we've had to do small, slight redesigns on our printed circuit boards to keep production going with the small delay. So that's the way we're working it. We do see some of our suppliers that have the biggest problems are now confirming delivery dates that are a lot more confident going out starting in sort of the September, October timeframe. Some have actually resumed shipping products. So it's really a broad mixed bag of different situations vendor by vendor and different parts classes.
Unidentified Analyst: Certainly appreciate the elaboration. And I like the numbers on the backlog. Are we going to be able to work that down over what timeframe? At 10.2%, which I assume, where you tell me, is it roughly the same now as at year-end?
Ted Grauch: I would only say it has not materially changed. I think, the best way to answer that question, Greg, is to say that there's 2 elements to the backlog. Number one, that the fundamental part of it is that we shifted our sales strategy in the early part of last year, taking advantage of the fact that some of our competitors were seeing the supply chain issues hit earlier than us, in some cases, just simply maturing the relationship, the sales relationship we have with some of our customers to extend PO coverages to longer periods of time. And to put it more specifically, we've tried to push as many of our largest, most loyal customers into 6-month rolling forecasts that are instantiated into purchase orders. And we've had very good success with that since the second quarter of last year. We believe a portion of that, kind of, a best practice is going to continue even after the supply chain. So in a perfect world, we'd actually retain a fairly significant backlog, because what it is, is representing us having under contract a long sort of runway of shippable products that the customer will not take until subsequent months. That's a very good thing. That's a portion of that amount. And of course, obviously, there's a healthy portion of that $10.2 million -- roughly $10.2 million backlog that we would love to be shipping faster if we only had the parts to build products at a faster clip. So those, ideally, in a best case scenario, we start to see some actual material recovery in supply chain later this year. But the problem is we don't have enough broad-based feedback from all of our suppliers to really give a high level of confidence as exactly when the timing of a recovery will happen. We just don't. And so because we tend to be a very conservative company is as it relates to prognosticating and giving future. We're wishing for, and we're planning and we're working to improve the situation as fast as possible. We're planning for the worst-case situation as well. So -- and the truth is going to play out over the coming 9 months or a year or however long it takes for the overall market recovery to happen in supply chain, semiconductor supply chain. On the positive side, that does seem, as you probably picked up, a backlog that's big and with all the new product announcements, product releases last year, we feel really good about the company's prospects. A lot of demand, a lot of conversations with new customers. We grew customers last year, large telecommunications and cable operator customers, smaller ones, a broad-based upswell of new customers. If we just have the parts to build at the level that the demand is at and is growing, we'd be in a really good shape, is my opinion.
Unidentified Analyst: The -- given the supply chain issues, which we talked about on the last call, have you had -- have there been layoffs, furloughs?
Ted Grauch: As we've reported in -- well, as we discussed in this, as we released in the press release and we'll elaborate a little bit more on our upcoming annual report and 10-K, we have had to do operational expense reductions. That's a broad base of layoffs to as limited of an extent as we can manage, while still being 100% confident we can operate the company, build the products, continue R&D, et cetera. And other areas that we found to find more efficiencies and production, more efficiencies in our operations, reduced expenses in terms of services and consulting and other things. It's a broad base and it has included layoffs, yes.
Unidentified Analyst: All right. The -- we talked about this last time. The price increases, are those likely to be temporary or permanent going forward?
Ted Grauch: Our intention is that they are temporary and that they match the cost of doing business related to our ability to build our products in a timely manner and the competitive environment that's out there. So if there's a silver lining to the whole process of us having to raise prices, it is the fact that all of our competitors have had to do the same from the level of market intelligence that we have. Everybody is being faced with the same problem. And for the most part that we've seen, they've responded in the same way that we have, and they've had to raise prices related to their own increasing raw material costs. Our intention and why I think we were able to generally get our customers to respond -- and I think I mentioned this to you a similar question last quarter, we were able to convince all of our biggest customers, regular customers, all these customers that have moved over to 6-month rolling forecasts with purchase orders backing them up. We've convinced them all to take price increases, and we were able to do so pretty rapidly. And part of that process of why we were so successful relatively quickly, was we gave assurances that when our costs were coming down, we were not going to sit there and take advantage of the situation. So I think that's -- if we want long-term relationships and we want the trust to continue with our customers, then we're going to honor that. I can't sit here and tell you how long it's going to take. And I know that there are some parts that may not come down back to their pre-pandemic price levels, right? So as it relates to those prices remaining high in the future, then we will not go back to the original pricing we had before all of our raw materials went up. But I do expect there should be -- you would think just rationally, there should be some pullback. We've seen a couple of vendors pull back their prices to, say, 10% or 12% or 15% above where they were pre-pandemic, where at the height of the problem for us in later Q4 or early Q1, they were running -- they were asking 2x the price for the same product. So I mean, I know that’s 1 anecdote of hundreds of parts and hundreds suppliers, but it is an indication that there could be some pullback in pricing.
Unidentified Analyst: And as a consequence, I assume that margins -- you might be able to maintain margins at the current level?
Ted Grauch: Well, our margins in Q4 really took quite a hit for the quarter. Our product mix -- our improved product mix for the year is what yielded that just a little under 10% improvement in blended product mix gross margin. Without getting into specifics of how Q1 is coming along, because we really don't -- our practice is to try to tell you what happens after it's actually happened as opposed to prognosticating. It's reasonable to think that our price increases across the board and more specifically, with the most effective products have yielded some recovery on our product gross margin. I'm cautious to really project that out in the future because, again, we just keep getting different surprises related to -- everything related to supply chain. I mean, just to give you one simple example that just happens in the news, so I'm not really sharing anything confidential at all, is there is a big flare-up of COVID in China in different places. And we had parts that were supposed to ship to us just a few weeks ago, 3, 4 weeks ago, that were in the process of shipping and they closed all the airports in Shenzhen and other parts of China, and we had parts stranded for 2 or 3 weeks. So we could not have predicted that even 2 or 3 days before it happened and we just had to find out the information accommodated work or production planning around those delays. And it's literally a weekly and other week kind of slog through these kinds of situations that the whole world is dealing with right now.
Unidentified Analyst: That's -- it's really got to try your patience. Though not be a whole lot of fun.
Ted Grauch: It's -- yes, I totally agree with you, Greg. Thank you for the empathy.
Unidentified Analyst: All right. The borrowing cap now -- or what is -- how do we stand with MidCap? I mean do we have anywhere near 90,000, I see at the end of the year? Has that improved? Or...
Eric Skolnik: This is Eric. It fluctuates daily because of the formula. So it's really hard to pinpoint how much we have exactly. But generally speaking, at a month end -- because of the month-end results, we generally have a higher amount of availability at the month, and then we kind of eat into that as the month goes on. So it ebbs and flows. It has not significantly changed, though, from year-end.
Ted Grauch: On an average basis.
Eric Skolnik: On an average basis, correct. Yes.
Unidentified Analyst: Right. And that agreement, I think, is up -- ends in September?
Ted Grauch: October of this year.
Unidentified Analyst: October. Are we looking forward to reworking that and more generally to continue to fund the operations other than -- can you elaborate on what's been presented so far about raising enough cash to continue?
Eric Skolnik: Well, as far as the MidCap facility is concerned, as you said, it expires in October. We are working with them. We haven't actually started the negotiations yet, but we generally do that about right around now, a little later. And we're going to look at whoever -- as our normal course, we always look at other financing options as well. So once we have something to report, we'll be able to report on it.
Unidentified Analyst: Any -- could you say whether we'll go the equity route or to just try to renegotiate with MidCap or with someone else? I assume you're looking at both options.
Eric Skolnik: Well, the equity route would be for additional capital, and we evaluate that on an as-needed basis to determine whether or not we decided we want to go to the market for a private placement or an at the market or something like that. But in terms of a general working capital facility, our intent would be to engage with somebody to continue that type of a relationship going forward.
Unidentified Analyst: And I assume, given the way the announcement about the strategic considerations underway, that you won't be able to -- we shouldn't expect to hear anything or at all on that process?
Ted Grauch: Yes, I can answer that. We put out the announcement because we wanted there to be an understanding by companies that might have an interest to talk to us that we're open to having those discussions. So at this point, that's basically where we're at. And when there is actually anything to report, we will go public with any of them.
Unidentified Analyst: Okay. And have you -- are you in ongoing discussions? Or are you just waiting to hear from the exchange about the stock listing, continued stock listing?
Eric Skolnik: Again, the press release that we put out regarding our delisting notification and our intent to appeal remains the same, nothing. There is no -- when we have something to report, we will report it.
Unidentified Analyst: Is the stockholder equity requirement the main criteria that they're looking at that -- the continued listing hangs in the balance, is it mainly about the shareholder equity?
Ted Grauch: Yes. It is the only criteria that the exchange has discussed with us, yes.
Unidentified Analyst: Okay. Well, it's the same story as we left it last call with the supply chain issues, which these things are never ending. Appreciate your work. Like I said, I can't imagine just waiting for the call from wherever to tell you what -- where the next shortage is, but you do your best you can. And this is an industry-wide problem, so it's not unique to Blonder. It'd be nice to break into the clear at some point.
Ted Grauch: It sure would. Yes.
Operator: Our next question comes from .
Unidentified Analyst: I'd like to concentrate a little bit on the recent 2 releases that you put out on the video transcoder series and your advanced OTT to linear broadcast. In terms of your backlog being the end of the year, was 2-point -- or $10.250 million range, can you give us an outline of how fast it's going to be? How long is it going to take to get these 2 product lines into manufacture and out in the marketplace going forward? And I assume that you haven't got -- there isn't any backlog in these 2 product lines that's in that $10 million. And so it would have to influence more the second quarter going forward since we're at the end of the first quarter. Can you give us a little range of how you're approaching this? And then talk also about the product line differentials that that you have to get components for. Is it better with these new products? Or is it just about the same with what you're experiencing across your broader line?
Ted Grauch: Sure. You're welcome. Thanks, George. So let me break down your questions into different pieces and try to be as efficient as I can to answer them. So we issued a number of press releases on new products and partnerships and certifications, recently. Let me talk about the one with DIRECTV, first. So this was a press release related to our Clearview transcoder products being certified for deployment in DIRECTV markets and for the same product lines to be approved for DIRECTV dealers to submit as part of their subsidy program. A very, very important press release, very important activity that we've had working with DIRECTV directly over the last 1.5 years to accomplish. These products actually started being produced and shipped during last year. And the press release lagged the actual activity in the marketplace by some months, just due to the normal process of discussing -- creating a public awareness of the situation, et cetera. So in fact, the $10.2 million or so backlog does include a pretty healthy -- a nice chunk of that is related to these Clearview products that are going to be shipped into DIRECTV markets. But that's not -- that's far from the only large elements of our backlog. The other press release that you referred to about a brand-new encoder, the Clearview series encoder as opposed for transcoder, that will support the ability to create video content and audio content that can be streamed over the open internet or an internet formats on private networks, et cetera. These are products that are destined for most normally, people like large and small cable operators, telecommunications companies, large and small. And even into smaller markets such as houses of worship for their internet broadcast of religious services or distance learning, business uses, et cetera. So there's a broad range of use cases for these products. We expect those products, as we said in the press release, to be shipping in approximately 10- to 12- to 14-week kind of range from when the press release came out on. The biggest one of those products is called the Clearview HD2X product, and then we're going to have some other derivatives of that product as well for going after niche markets. In terms of the backlog -- sorry, in terms of the supply chain issues, the biggest problems we've had, the largest problems that we’ve had in terms of how product -- our ability to build a product has mapped into supply chain. It is unfortunately, the biggest impact has been in the newest most high-technology products. So even though we had a big increase in those product shipments last year as we reported, they could have been quite a bit larger if it had not been for the supply chain situation. They are the biggest products being impacted by these shipping supply chain issues. And I think I hit all your points. Did I miss anything?
Unidentified Analyst: Okay. Well, in terms of looking ahead on this, in terms of marketing these new product lines, is there a broader market for them? Or do you have to get into a totally different level of connections to sell your products on these? Or is it pretty much the same customer line, so to speak?
Ted Grauch: No. From our perspective, it's really the same customer base, if you include our very, very long and healthy relationships with a wide range of distributors. We use our distributors and sales channels for the smaller sort of integrators and other kinds of uses that are out there for our products. Our own sales -- independent internal sales team tend to focus on managing those sales channels with distributors and a separate set of people that focus on large service operators and small service operators, whether they be cable, fiber optic or telephone, traditional telco companies.
Unidentified Analyst: I see. And then one last adventure into this particular area. When you talk to customers that are buying these products, I'm sure that they're anxious to get them and you got your product components to be concerned about. Do you ever reach out to any of your customers and say, help us get products, give us some ideas or whatever? Or is that something that you don't do?
Ted Grauch: We would not normally do that because our customers would typically not have the relationships necessary to help us with semiconductor raw materials supply chain. Their supply chain would be companies like Blonder Tongue Labs or other companies that are producing finished products, right? So there have been a couple of examples where some of our larger customers in the cable operator space have actually said, "Hey, we have a relationship with those guys that you're having a problem with. Maybe, we can reach out." And we've taken them up on it, of course, but it has not yielded any better improvement in anything versus what we've been able to do ourselves.
Unidentified Analyst: Yes. Okay. And just an observation on closing from my point of view. These recent developments that you've introduced, I think are setting your outlook for more positive things to happen. And it would seem to me that you are definitely expressing to the marketplace an ability to recognize what you have to do to expand and you're right in the middle of accomplishing it. And it would seem to me that, that will help you in trying to generate the funding necessary to keep your company safe and moving ahead and start to broaden its opportunity to really expand, going forward. It just seems to me like, with all the technology that Blonder Tongue represents and then expanding that this would be pretty exciting for people who are looking for things to happen in a company that's got a broad future in front of it. So hopefully, this all really starts to come together in the next few quarters.
Ted Grauch: I certainly share your sentiments. And I'm personally optimistic about the future, but as we've said, we have some challenges to get through and the uncertainty related to the whole supply chain situation. Some areas improving, some not, some getting worse. Things coming in from left field. It's just very difficult for us to try to give a reasonable specifics on the outlook and the timing of when we think things will improve. But in terms of the overall strategy, how the strategy is resonating with our customers, the release of new products, the kind of relationships we're having with big partners and big customers. Those have all been very, very positive over the last year.
Operator: Sir, there appear to be no further questions in queue. Do you have any closing comments you'd like to finish with?
Ted Grauch: No, I just want to thank everybody for continuing to support Blonder Tongue Laboratories, and we look forward to talking to everyone at the next quarter's earnings call. Thank you very much.
