Gentex Q4 2008 Earnings Call Transcript

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2009-01-29 13:16:16.0

Tags: Revenue, J.P. Morgan Chase & Co., Call Transcript, Earnings, Sales Strategy, Operational Accounting, Sales Force Management, Sales, Finance, Seeking Alpha, Gentex Corp.

Question-and-Answer Session

Operator

Thank you. Today's question-and-answer session will be conducted electronically. (Operator Instructions). Our first question comes from Himanshu Patel with J.P Morgan.

Ryan Brinkman - JPMorgan

Hi this is Ryan Brinkman for Himanshu. I just had a couple of quick questions. The first one relates to any thoughts that you might have to further cutting SG&A and R&D deeper, given your revenue outlook?

Enoch Jen

Well, Ryan like we mentioned, the outlook beyond the first quarter is currently very uncertain and in talking with the folks at CSM, at least in North America, they are currently expecting that around the end of the first quarter a large part of the excess inventories will be burned off and production levels will more closely, approximately sell at sales levels. We continue to monitor the revenue forecasts and depending on whether the CSM forecast of gradual improvement during 2009 holds up or not, we will continue to evaluate our overhead ER&D and SG&A expenses.

As you are aware, a significant portion of our ER&D expenses are tied to new business wins that will go into production over the next two to three years. And the prior growth in our SG&A expenses is primarily related to the expansion of our overseas sales and engineering offices, as our overseas shipments are accounting for a larger and larger percentage of our total company revenues.

Ryan Brinkman - JPMorgan

Okay. I appreciate that. Maybe this is just a housekeeping item but did you give fourth quarter Rear Camera Display and SmartBeam shipments?

Connie Hamblin

No. We do not give those on a quarterly basis. We give annualized numbers.

Ryan Brinkman - JPMorgan

Okay. What were the annualized backend (ph) based amount... RCD I believe is 279,000.

Enoch Jen

270,000. SmartBeam was 295,000 units.

Ryan Brinkman - JPMorgan

Okay. Thanks very much.

Enoch Jen

Welcome.

Connie Hamblin

Thank you.

Operator

Our next question comes from David Leiker with Robert Baird.

David Leiker - Robert W. Baird

Hi, good morning. Can you hear me?

Enoch Jen

Good morning David, yes.

Connie Hamblin

Yes. Can you hear us?

David Leiker - Robert W. Baird

Pardon.

Connie Hamblin

Can you hear us?

David Leiker - Robert W. Baird

Yes. That occurs sometimes these days, sorry about that. I wanted you to kind of walk me through a little bit, if you look at an opportunity for you to continues to get your product, new vehicles down the road and I think you increased penetration on existing programs that you are on. Have you seen any changes in that as the auto industry go through this distress in terms of they are putting more vehicles as they are pushing them off a couple of years, or the mix is different and content, any kind of general discussion on what you're seeing from your customers in that regard?

 

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