Stephen Merrick
各位早上好，感谢大家参加我们的电话会议。我是Stephen Merrick，CTI的总裁，我将与我们的首席财务官Tim Patterson以及公司董事兼投资者关系总监Stan Brown一起进行报告。报告结束后，将有机会让大家提问。
第三季度我们取得了良好业绩。净销售额为14,881,000美元，而去年同期第三季度净销售额为14,569,000美元，增长了2.1%。本季度收益为209,000美元或每股0.06美元，与去年同期第三季度业绩基本持平。但真正的亮点是我们九个月的业绩，这表明我们现在已经达到了稳定的销售和盈利水平。
九个月期间，我们的净收入为546,000美元或每股0.17美元，是去年同期的四倍多，并且包括今年三个季度中每个季度对收入的贡献。去年同期，我们的收益为132,000美元或每股0.04美元。九个月的净销售额为43,477,000美元，而去年同期净销售额为42,649,000美元。
从现金流角度来看，我们的业绩同样强劲。第三季度EBITDA为1,196,000美元，而去年同期第三季度为1,126,000美元。然而，九个月期间的对比尤为强劲。截至2015年9月30日的九个月期间，EBITDA为3,487,000美元，而去年同期为2,616,000美元，增长了33%。
我想重申，EBITDA不是GAAP会计准则的衡量标准，但我们在内部使用它来衡量核心运营业绩，因此已在收益报告中包含，并提供了与GAAP数字的对账。这些显著改善的业绩以多种不同方式反映在我们的财务报表中。
当然，一个重要因素是我们毛利率和毛利的改善。九个月期间，今年的毛利率为26.7%，而去年同期为24.1%。这一增长直接反映在我们的毛利水平上。今年九个月期间，我们产生了11,614,000美元的毛利，而去年同期仅为10,268,000美元多一点。
利润率的提高有几个原因。首先，在我们的乳胶气球业务中，由于原材料乳胶成本的下降以及我们在墨西哥工厂实现的生产效率提升，利润率在过去一年有所提高。其次，总体而言，我们的原材料成本有所下降，因为我们看到薄膜成本以及原材料乳胶都有所改善。第三，我们正在从利润率更高的产品中产生更多收入，包括我们的一些真空密封系列产品和家用容器产品。
营业利润也有所改善。今年第三季度，营业利润为713,000美元，而去年同期第三季度为519,000美元。九个月期间，营业利润为1,882,000美元，而去年同期为789,000美元。
我还应该提到其他几个影响我们业绩的一般因素。首先，利息仍然是我们收益方程中的一个重要因素。今年第三季度，利息支出为351,000美元，而去年同期第二季度为241,000美元。九个月期间，我们的利息支出为1,068,000美元，而去年同期为761,000美元。
其次，汇率变化对我们的业绩产生了一定影响。例如，在墨西哥，我们的许多销售以墨西哥比索计价，而比索对美元贬值。因此，这些销售的美元价值有所下降。同样，在欧洲，随着欧元贬值，那里的销售美元价值也有所下降。此外，这些货币对美元贬值，我们向外国子公司销售产品的成本（以其当地货币计算）有所增加。
现在让我谈谈我们产品线的销售业绩。真空密封系列的收入继续改善，第三季度达到3,983,000美元，而去年同期第三季度为3,770,000美元，增长了5.5%。九个月期间，该系列的收入为9,446,000美元，而去年同期为8,599,000美元，增长了近10%。该系列的销售往往在一年中逐渐增加，第四季度最为强劲。我们继续为该产品线获得货架位置，并在美国最大的零售连锁店以及其他连锁店和在线零售商中取得了良好的销售业绩，我们正在为该系列寻求额外的连锁店货架位置。
在我们的箔膜气球系列中，我们看到九个月期间的销售美元价值略有下降，为19,045,000美元，而去年同期为18,607,000美元。然而，对我们美国最大客户的销售在九个月期间继续增加，从去年的10,982,000美元增加到11,335,000美元。对其他客户的销售美元价值略有下降，部分反映了欧洲和墨西哥销售对收入的影响，这些销售以在2015年期间对美元贬值的货币计价。
但总体而言，我们的箔膜气球系列销售保持强劲，我们继续看到许多客户终端市场的单位销售量增加。今年我们推出了几种新的气球设计，包括一款成功的黑板绘制产品，并将在今年晚些时候和明年推出更多设计。
关于乳胶气球销售，与去年相比，我们经历了净销售美元价值的一些下降。但大部分下降与比索对美元贬值有关。乳胶产品的单位销售和毛利率保持强劲，我们继续在所有市场（包括墨西哥、美国、英国和欧洲）开发该系列的新销售。
在本季度，我们在新产品系列中经历了良好的收入增长，特别是我们的家用容器产品线，该产品线享有高利润率。该产品线的收入在第三季度增加到1,623,000美元，而去年同期第三季度为699,000美元。九个月期间，我们新产品系列（即家用容器和Candy Blossoms）的销售额增加到4,914,000美元，而去年同期为2,655,000美元。
我们的财务状况良好。在今年九个月期间，我们产生了3,395,000美元的正运营现金流。截至今年9月30日，我们的营运资本余额为1,150万美元，并且我们在信贷额度上拥有约240万美元的现金和可用额度。
虽然我们不提供收益指引，但我们的第四季度通常是我们最强劲的季度，我们相信今年很可能也是如此。我们相信我们在新奇箔膜气球和乳胶系列中有增长机会。我们有许多潜在客户，并正在积极在美国、英国、墨西哥、拉丁美洲和欧洲为这些系列寻找新客户和机会。
我们目前正在墨西哥工厂建造一台新的乳胶气球生产机器，预计将在2016年第一季度投入使用。这台机器将使我们的乳胶气球产能增加约30%。我们看到真空密封产品线持续增长，并且我们继续——预计将继续看到家用容器产品线的增长。
我想说的是，虽然我们一直在努力增加收入，但我们同样注重保持和提高盈利能力。
我们的报告到此结束。接线员，能否请您协助处理参与者的问题？
Stephen Merrick
Good morning, everyone and thank you for participating in our call. My name is Stephen Merrick, I am the President of CTI and I will be presenting a report with Tim Patterson, our Chief Financial Officer and Stan Brown, a Director of the company and Director of Investor Relations. At the conclusion of our report, there will be an opportunity for you to ask any questions you may have. We had good results for the third quarter. net sales were $14,881,000 compared to net sales of $14,569,000 in the third quarter last year, an increase of 2.1%. Earnings for the quarter were $209,000 or $0.06 per share about even with our results for the third quarter last year. But the real story is our results for the nine months, which indicates that we have now reached the consistent level of sales and profitability. For the nine months we had net income of $546,000 or $0.17 per share, which is more than four times the level for the same period last year and includes contribution to income from each of the three quarters this year. In that same period last year, we had earnings of $132,000 or $0.04 a share. Net sales for the nine months were $$43,477,000 compared to net sales in the same period last year of $42,649,000. From a cash flow standpoint, our results have been strong as well. For the third quarter, EBITDA was $1,196,000 compared to $1,126,000 for the third quarter last year. For the nine-month period though, the comparison is particularly strong. EBITDA was $3,487,000 for the nine month period ended September 30, 2015, compared to $2,616,000 for the same period last year. That's a 33% increase. I do want to reiterate that EBITDA is not a GAAP accounting measure, but we do use it internally to measure our core operating results, so have included it in the earnings release with a reconciliation to our GAAP numbers. These much improved results are reflected in our financials in a number of different ways. Certainly, a significant factor is the improvement in our gross margin rate and gross margins. For the nine months, our gross margin rate this year has been 26.7% compared to a rate of 24.1% for the same period last year. This increase is directly reflected in our gross profit levels. We generated $11,614,000 in gross profit for the nine months this year compared to just over $10,268,000 for the same period last year. This increase in margins has come about for several reasons. First, in our latex balloon business, margins have increased over the past year due to the decline in the cost of raw latex as well as production efficiencies we've achieved at our plant in Mexico. Second, in general, our cost of raw materials has declined overall as we have seen some improvement in film costs as well as in raw latex. Third, we are generating more revenue from products, which have a higher margin rate, including some of our vacuum sealing line of products and our household container products. Income from operations has improved as well. For the third quarter this year, income from operations was $713,000 compared to $519,000 in the third quarter last year. For the nine months, income from operations was $1,882,000 compared to $789,000 for that same period last year. There are a couple of other general factors, which I should mention that do have an effect on our results. First, interest remains a significant factor in our earnings equation. In the third quarter this year, interest expense was $351,000 compared to $241,000 in the second quarter last year. For the nine months, our interest expense has been $1,068,000 compared to $761,000 for the same period last year. Second, the changes in currency exchange rates are having some impact on our results. In Mexico, for example, many of our sales are denominated in Mexican pesos, which has declined in value against the dollar. So, the dollar value of those sales, have declined. Similarly in Europe the dollar value of sales there have declined, with the decline in the value of the euro. Also the decline in the value of these currencies against the dollar, the cost to our foreign subsidiaries in their local currencies, a product we sell them has increased. Let me now turn to our sales results in our product lines. Revenues in our vacuum sealing line continue to improve, reaching $3,983,000 in the third quarter compared to $3,770,000 in the third quarter last year, which is an increase of 5.5%. For the nine months, revenues in this line were $9,446,000 compared to $8,599,000 for the same period last year, an increase of almost 10%. Sales in this line tend to increase over the course of the year with the fourth quarter being the strongest. We continue to have placement for this product line and good sales results in the largest U.S. retail chain, as well as in other chains and online retailers and we are pursuing additional chain store placement for the line. In our foil balloon line, we saw a small decrease in the dollar value of sales in the nine months at $19,045,000 compared to $18,607,000. However sales to our largest customer in the United States continue to increase for the nine months to $11,335,000 from $10,982,000 last year. The small decline in the dollar value of sales to other customers reflects in part the effect on revenues from sales in Europe and Mexico, which are denominated in currencies that have declined in value against the dollar during 2015. In general though, sales in our foil balloon line remained strong and we continue to see increases in unit sales at a number of customers end markets. This year we had introduced several new balloon designs, including a successful blackboard drawn product and will be introducing additional designs later this year and into next year. With respect to latex balloon sales, we've experienced some decline in the dollar value of net sales compared to last year. But for the most part, that decline relates to the decline in the value of the peso against the dollar. Unit sales and gross margins on latex products remained strong and we continue to develop new sales in this line in all of our markets, including Mexico, the United States, the U.K. and Europe. During the quarter, we experienced good revenue growth in new lines of products, particularly our household container product line, which enjoys high margins. Revenues in this product line increased in the third quarter to $1,623,000 from $699,000 in the third quarter last year. For the nine months, sales in our new lines that is household containers and Candy Blossoms increased to $4,914,000 compared to $2,655,000 in the same period last year. Our financial condition is good. During the nine months this year, we generated positive cash flow from operations in the amount of $3,395,000. As of September 30 this year, we had working capital balance of $11.5 million and we had about $2.4 million in cash and availability on our line of credit. While we do not provide earnings guidance, our fourth quarter is generally our strongest quarter and we believe that it is likely to be the case this year as well. We believe we have opportunities for growth in our novelty foil balloon and latex lines. We have a number of prospects and are actively pursuing new customers and opportunities in those lines in the United States, the U.K., Mexico, Latin America and Europe. We're currently constructing a new latex balloon production machine at our facility in Mexico, which we expect to have online in the first quarter of 2016. This machine will increase our latex balloon capacity in the range of 30%. We see continued growth in our vacuum sealing product line and we continue to -- expect to continue to see growth in our household container product line. And I do want to say that while we're always working to increase our revenues, we are as much focused on maintaining an increasing profitability as well. That concludes our report. Operator, may we have your assistance with respect to questions for calls from our participants?
