Harman International Industries Inc. F4Q09 (Qtr End 06/30/09) Earnings Call Transcript

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2009-08-20 15:56:21.0

Tags: Revenue, Call Transcript, Earnings, Credit Suisse Group AG, Harman International Industries Inc., Operational Accounting, Research & Development, Finance, Business Operations, Seeking Alpha

Question-and-Answer Session

Operator

(Operator Instructions) We'll go to the line of Chris Ceraso with Credit Suisse. Please go ahead.

Chris Ceraso - Credit Suisse

Why don't we start with the new business awards that you referenced, that you're getting close to. Obviously, you can't disclose what they are or you would have, but maybe you can give us some color around two things. One, what type of business is it? Is it high-level system or mid-level system? Two, if you win these programs, when will be the start of production? Are these 2011, 2012, 2013 programs? Maybe you can give us some of these details.

Dinesh Paliwal

Certainly. Chris, first of all, we are very excited about the situation we are in and that's naturally an outcome of successful launches of 13 programs. I'll really like to remind, because about a year ago, we got a lot of heat from our investment community that, why are we investing so much in R&D. I'm glad that we did, because now we are well positioned.

To answer your question, the awards we are working on to finalize are for both. For high-end premium systems, as well as what we traditionally call mixed systems, and I like to call it, 'scalable infotainment system platform', which we have developed. So, that is the first part of your question.

On SOP dates, Chris, unfortunately I can't comment on it because our customers do not want us to comment on SOP dates, but these will not start to turn into revenue. From the day we receive these awards, we're talking two-and-a-half to three years out.

Chris Ceraso - Credit Suisse

On the new system, the scalable system that you're talking about, you talked a little bit about that last quarter. If you're getting close to the point where you can bring that out to customers and sell it, again, this is kind of like the second part of the last question, so it will be two-and-a-half to three years before those programs are ready to be launched and turned into revenue. Am I thinking about that right?

Dinesh Paliwal

No, Chris, you're always right, but not this time and for good reasons. The scalable infotainment platform we've developed, that's why I stress we have developed, it is so scalable and so modular that it's ready to go, provided our customers are ready to go. So we will only be dependent on our customer's model year cycle or the production cycle. So, let's say, if a customer is ready to launch a new system, it's ready to go. So I would say on an average it might be 12 months, earliest we can see, scalable new platform, new system infotainment would be turning into revenue from the time we received the order.

 

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