Clearfield, Inc. (NASDAQ:CLFD) Q1 2024 Earnings Call Transcript

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Cheri Beranek: We’re not providing guidance that far out. And so there – I’d say there is an opportunity in that we’re building a company to be able to address that and we’re building capacity to address that. One of the enhancements that we’ve made over the course of the last year is the expansion of the amount of Microduct that we’re able to provide. And what’s exciting about Microduct, not only that it increases the revenue and increases the margin, but it also is a precursor to future connectivity sales. So it gives you an early indicator and the addition of resources there. For connectivity – someone who has a strong background in connectivity and understands the differences and nuances of the types of connectivity solutions that are necessary, certainly will help us pull that through.

I’d say don’t get – again, it’s more of a trendline there, I think for us, rather than a specific target for the summer months and because of the fact that the rockiness or the lumpiness of their seasonality, $15 million is possible, but not a forecast from us.

Jaeson Schmidt: Okay, that’s fair. And then can you update us on the timeline on where you’re at from being able to manufacture the Nestor product line in the Mexico facility?

Cheri Beranek: We’re already doing that. So the only issue we have is the availability of PVDF materials. And so we are fully manufacturing in Mexico, the Nestor product types. Mostly, what I think is important though there is that we’re not intending to manufacture high count fiber for the U.S. market. That tends to be a commodity level product line. And so we aren’t going to make the capital equipment investment for that. But certainly all of the products that Nestor made for Clearfield were able to do in the Mexico facility. And we’ll be able to do with the expansion of our manufacturing lines and the new cable lines that we’re putting into one of our Brooklyn Park facilities. We’ll be able to do all of the previously Nestor supplied equipment in Minnesota as well.

Jaeson Schmidt: Okay, perfect. Thanks a lot, guys.

Operator: There are no further questions in the queue. I’d like to hand the call back to management for closing remarks.

Cheri Beranek: Liam, thanks for the opportunity to spend some time with you all at this period of time and to really help to provide, I think some insight behind a long-term investment opportunity. We are at an amazing time right now in the U.S. market and on the brink of really becoming a fiber rich country. And the opportunities that presents for us and the economy that it will build is certainly a strong one. The Clearfield opportunity here remains the same. Our value proposition is exactly built for this time. And I welcome the opportunity for you to join me in recognizing some of the benefit that fiber is going to provide. And hopefully you see that and want to participate in that as being a shareholder of Clearfield.

Operator: Ladies and gentlemen, this does conclude today’s teleconference. Thank you for your participation. You may disconnect your lines at this time and have a wonderful day.

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