Welcome back 1 to E, Inc. 2020 first quarter earnings conference call. All lines have been placed on mute to prevent background noise. After the presentation there will be a question and answer session. For your information, a webcast replay will be available within an hour after the conference is finished.
Please visit www.einc.com under the Investor Relations section. And now I would like to introduce the chairman, Mr. Johnson Lee, CFO, Mr. Roy Chen, Financial Center director, Mr. Patrick Chang.
Now please begin.
Good day, everyone. My name is Roy Chen, the CFO of E, Inc. 1st of all, I would like to talk about the financial, in the first quarter. Expansion.
I think before we talk about the
the financial in the first quarter, that spends few seconds on the Safe Harbor statement. Okay. Next page. Alright. For 1st quarter results, 1st, first, for the sales revenue, it's around 2.9000000000 in NT, but it's worthwhile to mention, even you you you can see from the presentation in terms of the year over year, comparison, the sales revenue, was declined by 1%.
However, if if we translate it from the local travel currency to the US dollars, Actually, the sales revenue was increased by 1%. And that was caused by the, you know, relatively stronger U. S. Dollar against MTV in first quarter 2019. And for the gross profit, percentage, that was 46.2 percent, equivalent to, 1.3000000000 NT And for operating profit, that was 68,000,000.
And in terms of the non operating income, basically, that was 8, 20,000,000. If it's written down, basically 3 major components, one is on lower income. The other is, realized and unrealized, foreign exchange evaluation game. And the last part was the, financial income associated with, the the cash that we have on hand, to be invested in those financial assets. And that that led to the net income in 1st quarter, was 790 amelia NT and the associated EPS was, $0.69.
K. Next page. After the, numbers. I would like to talk about the accomplishments, that, e ink has done in the first quarter. I think, first of all, I would like to talk about, a term that you may know that much, familiar with.
E inc gallery. So, basically, e inc gallery, it is mark marketing name, of the full color e paper display module, a printer that is using ASAP technology, ASAP. Basically, it's short for advanced colored epaper technology. Basically, it This, ASAP is a high quality, full color reflective display. In the ASAP, on the ink and produce full color at every, pixel, achieving full color, given without the use of color filter array.
And you may see another, term. It's called e ink, yellow repellent. Basically, it's using the same, asset material. But provides unlimited 7 colors. So, we with those new technology that we are working on, in first quarter, we, we shipped more than 1000 samples.
To around, 30 customers in terms of the e inc gallery palettes, especially on the 5 point 65 inch, samples. And also, in first quarter, we also came up with 1 of the leading TFLC, the panel suppliers, interlocks, basically, the the collaboration, that we work with, basically, on large size, on a set panels, basically, in a lot on is the first partner to work on the production and, sales of large size ASAP. With this partnership, e ink and email us. We're focused on expanding, e paper products in IoT and smart city applications. As you can see, on the presentation, the 28 inch of bar type fine each, basically, would be one used for, in vehicle advertisement signage and, retail signage.
And and also being used for the public transportation such as a natural, high speed railway, train and bus. And that's for the e ink gallery and and and and gallery pallet. And we also have some achievements, in the tcomb, t 1000. That's the, in in house in chip that we, have explored. And in first quarter, we, one of our customers in China, I fly tech.
Basically, they they work with China Mobile and and launch a new product on email 9.7 each. And also, in 1st quarter, basically, policy on COVID 19 impact, around mid March. We we suffered the the capacity problem in our youngjo, our motor site. However, at the beginning of April, the capacity was fully recovered. So, so those are more to capacities ready to go for for for the growing demand.
And, also, I just mentioned, our operating profit in First Quarter as well as the net income and associated EPS, basically. Now what's the best first quarter achievement in the past 9 years. And and that's the accomplishments we have made in the first quarter. And next page. The the next one is, a result, it's it's about our color technologies.
And and once again, I'm talking about the the term that you may know, familiar with, which is, e ink, colloidal So, once again, it's a marketing name, for the, color e paper display module, for that, but with the technology pre pre color technologies. Basically, it doesn't use the the convention, glass based print color filters. Basically, you just, you know, direct print on our e paper materials. So that make our product a finger lighter, and and with higher contract ratio and less, paradox. And the the most important is that, that provides a lower cost solution to the potential customers.
And with this new technologies, some of our, customers in China, such as, eyeweeder, books, hycents, and, eye flight hack. They are all on utilize this, e in cryo technologies. And and also one of our, Europe, customers pocketbook is also using the the the technologies. And, So far, the market's feedback we have collected, basically, it's pretty much exceed the market expectations. So, what we need to work on harder is on how to scale up, our e ink collateral capacity.
That's something we we need to, enhance and work on harder, from the first quarter. At this page. And, this page is about, our, corporate recognition externally. So, e ink was has been the the the pioneer, to utilize the renewable energy on certificate. And basically, e ink, is the 1st company to purchase the renewable energy certificate in in Taiwan.
And for all the, renewable energy certificate has been issued in Taiwan, e ink has purchased more than 30% out of it. And, and e inc, and and with another, I don't know, company such as TSMC, a Fox ring, has been the green energy purchased on programs on biggest on participants. So that's for the green energy, renewable energy. And for for the corporate governance, evaluation, e increment on being ranked, under on top 20 companies, I'm listed in in in TTECS, basically, Type A Exchange, both in 2018 and and in 'nineteen, in terms of the, corporate governance evaluations. So that's, the corporate recognition that we keep in the first quarter.
Let's switch. And for the gross profit on trend, as you can see, from the presentation, the 1st quarter, gross profit percentage was around 46%. It has been increased from around 30% in first quarter, 2016 and all the way up to, 46. Percent. And the reason behind was, basically, we have been
I'm selling more,
even a material, than the, the the module So so that creates a a better, gross profit margin to us. And on the other hand, we have been working very hard on the, you know, operation optimization and also improve the supply chain efficiency. As well as the, automation. So that that leads a better, gross profit margin in the first quarter. And, gross profit margin remained high, basically, in in the first quarter on this page.
And the next one, is the appraising of profit part. And I just mentioned earlier, 1st, the the this quarter, was the best first quarter achievement in the past 9 years. Few reasons, basically, in in in the first quarters, we have more material cells and basically offset the module cells decline. And once again, we spend more efforts on automation. And, cost reduction, on the, supply chain efficiency and upgrading cost improvements.
So, basically, that that lead to a better, operating profit in first quarter this year. And the next page. And the next one, is on the balance sheet part.
The first thing I want
to talk about is the asset site. In the asset site, I mean, the the cash and financial assets has been, increasing. So you can see from from the presentation, first quarter of 2018, the total of financial assets plus cash, was around, like, 12,000,000,000. And after 2 years, the the cash and financial assets we have on hand was around 15, periods. So, basically, we we utilize the cash we have on hand to invest more financial assets.
So that's for the, asset side. And for the liability site, one thing to to mention, was basically from, 4th quarter 2019 to 1st quarter 2020 debt ratio hasn't been, it it it has been slightly increased. The the bigger jump with, 2000, 22,018. In case, the the cash utilization strategy we have on hand is, just like what I just mentioned, we convert the cash on hand into financial assets. To generate higher interest and investment income.
On the other hand,
we basically like the bank loan
it's a lower on interest cost to meet the operation on cash needs. So that's the reason why, our financial asset plus cash has been increasing. But on the other, our debt ratio also on slightly, being increased from fourth quarter last year due to this year. K. Next page.
For the cash flow movement, so once again, few major points, we we converted the the cash on hand for financial investment and operations. So as you can see, from from the bar on the presentation, we utilize the cash on hand from 8,000,000,000 to around 6,000,000,000. By the conversion, from cash to on time deposit and in the financial assets. And those those cash generated from reality and operation, basically, is used for the CapEx for, expanding, e ink, collider capacity and material capacity. K.
Next page, is about the global r and d. Footprint. So, in the first quarter, 2020,
we have
of 462 R and D employees globally. And the global on the spending in the first quarter, was, around 600,000,000. And in terms of the, patents we have on hand, I mean, 1st of all, we have more than 5000 5000 globally. And the way we we we build out our patterns is it's from one layer to the other just like just like we we we reboot on the the the blocks. You know, we we we started from the basic, unprincipal patterns.
And go all the way, some optical layer, imaging film, and then to the electrical for example, the the something relevant to the TFT back plant. And then, on the module display module design, and also driving the algorithm and and waveform and all the way up to the device and applications. So just like we are building the blocks from from one layer to the next. And and June, June, Geographically speaking, the way we, we, place our, our need resources, basically, in the United States, from Fremont to Belica, basically two sites are specialized on the material. But also the advanced technologies.
And in the Asia, in China, Yamjo, basically, specializing in the module, in in Tokyo, Japan, decide that we spend most of our resources on the on the advanced technologies. And entire world, Xinjoo and Nicole, few things are specialized, module, advanced tech, a material, and even assistance. So that's how we build up our patents and spend our R and D resources in this page. So the last page is about the the business opportunity. After the COVID 19 crisis.
I believe that the COVID 19 impacts you all, especially in the in the States and and also the the Europe. But we we we do identify 3 major, business opportunities there. And the first one is CT Learning. The second one is grocery retail. The third one is information for it.
For the for the e learning, basically, we still target the education market. The target the the targeted market basically, still on the distance education homeschooling, and those tests from work being done on cloud. And with the the product feature, I'll I'll I'll roll a product. For example, easy or lies, low power consumption creates a loan sustaining basically combine the function, not only on on reading, but also on writing. So that that, gave us more opportunities in the e learning, business.
So, at the beginning of the COVID nineteen, breakout we understand, in the long run, you will and and and and USA market would be, you know, more impacted. So we we spend more time, on on build up a better ecosystem in China. So, in first quarter, for example, on the brand, the higher and another brand that I fly tech. They all, launch the new, e learning e paper, products, in this field. For the grocery retail, because of, the the the outbreak of the, COVID 19, basically, that we will believe that we will speed up the installation after the epidemics.
And same thing for the information board. During the COVID 19, academic, we believe, a reapply update information board, for the emerging, trusted message would be very important, especially, that the nature of our product tend to be easier to be installed. We believe we can take advantage, on on the COVID 19 crisis. So that's, 3, potential business opportunity that we noticed, in the first quarter. So that's about my, presentation.
If you have any further questions, feel free to ask, Johnson, myself and Patrick, we're happy to answer. Thank you.
Yes. Thank you, Mr. Chen. And ladies and gentlemen, we will now begin our after you are announced, please ask your question. If you find that your question has been answered before it is your turn to speak please press 2 to cancel the question.
Thank you. Now please press We're now in question please press 1 on your telephone keypad. Thank you.
Hi. Michael, we we we noticed, I think you you do have a big problem on to to to ask questions. So feel free to to ask the question online. We we are happy to answer.
Yeah. So I think I saw one of the comment is color EPD cannibalizing the black and white e reader. Could you give me more explanation on this? So, basically, yeah, I I do believe that once there's color, people would choose color over black and white as long as the black and white on the color is is just as good as the current black and white. I think people today are still buying e meters because the black and white experience with an e ink display is is quite good.
But once we can achieve just as with black and white and with additional color, it it will definitely cannibalize the black and white business. But we do believe that the market TAM will be bigger than what it is today. And that's our goal. Our goal is really to expand, the market TAM for the E Meters and really move the EA technology not just for e readers, but for other applications because once we get color, there's more applications we can go after. K.
Okay. Also a problem. From the question online, few questions about the the outlook in in the second half. Yeah. Yep.
Johnson would you like to use it?
Yeah. So so so basically, teacher was looks okay. We're still very well, we're still bullish. Looks looks better than than last year. But looking for the second half of this year, I mean, there's a lot of uncertainty because of COVID 19 and also because you know, we're we're kind of, you know, our color e reader has the demand is is quite strong, but we really don't have that enough capacity to fulfill that.
And and it's really impacting the black and white business. So so we do expect some some turbulence moving into to q3 impossible q 4, but we'll see. I mean, it's how quickly we can go up the color capacity to to meet that. And and it's really when we can pour in the equipment and start doing that manufacturing. So so so that's roughly the situation for for us.
I mean, ESL overall, we do expect hit to grow compared to last year. We're not allowed to give you exact numbers, but if you were to look at our partner that's downstream. Most of our partners has has issue of, you know, positive growth rate. For for the ESL market. And and so we
think yeah.
Each arm is about dollar apps. I think Harvey is asking. Another question is how does ACEP, which is our marketing name is called Ian Gallery, and Kallido, which is our print color. But Kallido is our marketing name. I guess Carvey has been following for a while, so he knows our technical name or our gallery is is ACP.
Yeah. So so ACEP that the color, saturation is
is well light. It's it's good.
And but but it does have one big issue at the speed of the update and that flashiness. So So the current the market that's good enough for that is mostly signage and price tags and and different paper replacement that that wanted to have good color performance. Doesn't care too much about update. But it does require you to update that it can replace paper. So so we do think there's a big enough market just in that that field replacing the paper that's out there, the posters, the, the paper tags, the price tags, and and signage, and these kind of applications.
But for e readers, speed is very important. The black and white experiences are important. So with the collider, we think it's it can serve that market. And, also, the color alone is not as good as So the collider color is not as good as our galaxy. Gallery.
Sorry. Our gallery product is also getting used to the name. Markality product. It's it's still good enough for for educational market, especially in China. We compare the color saturation of our collider, and we think that I mean, you're gonna serve that market.
And that itself is a big market. As you can see from our slide, that bird was zenting. Our R and D expenses actually gone up. We're still able to squeeze some profit out of it, but our R and D expenses went up. And that's mostly because we want to continue to reinvest into our technology.
We
think that we can do a better colloidal product moving forward. We also believe we can do a better galact gallery products. So we're still investing to these 2 technology. But at the end of the day, that they might compete because once gallery speed is as fast, you know, it can be potentially replace the Kallido. Kallido product and the Kallido has colors to ask for HMPs, it can potentially place gallery, but that's okay.
I mean, we're competing with ourselves, though. So so that's good. I mean, I mean, we have this notion that we need to be, you know, we we need to we shouldn't be complacent. We should continue to enovate. And sometimes because our competition, there's not much competition if you owe the e paper, So we really need to compete with ourselves to to really move forward.
And that's one of our main goal is really to how how we can speed up our r and d development and and launch new products one after another. And once we can start doing that, I think the ink will be in the much better shape than where we're at today. And we're still in that stage of trying to build our pieces together and and building this ecosystem to create the 3rd category for for this place. I mean, there is an LCD mature industry that's out there already. There's the OLED that's up and coming that's trying to compete with LCD.
And we're really trying to create that third leg. I mean, the 3rd industry, that's really twice in the paper that's out there. That's easy on the eyes and that's definitely placed tech support to her. Or, you know, using the educational field and and really to offer a better e reader experience that's out there. And also just the the paying for itself, we're trying to play.
That's that's building the dollars in market. When we're building this ecosystem, we were trying to deal with our partner to grow it. So that's why when you look at our financial statement, we'd actually break it down in terms of module, then, and material cells. And and one of the highlight that Laura was talking about was, you know, we partner with intellects to go after the large size e paper modules where e ink provides the e material to analog to analogs. Active with module partner that sells to the customers.
And and it's I think it's super important to put that ecosystem or partnerships to really grow this market. We're in the process of doing it. You can health from our financial statement or income statement that our material sales is growing. Sometimes it it actually compete with our module. Our partner's module compete with our own model, which is fine.
It's part it's part of the game. It's part of building that ecosystem and and and growing it. Okay.
No. If you would like to ask a question, please press 01 on your telephone keypad. Thank you.
So so Jerry is asking our gross margin for color versus black and white. I I think EA is really running at a pretty high gross margin already. And and it's actually getting higher because we're doing more material sales, but I I think that the key for it is really to to grow the the epaper, industry or or ecosystem and and to more application that's gonna adopt e paper. It's great that we have a gross margin. That's that's that's quite healthy.
But the goal is really to to get it in everywhere. So so we're still in that phase. We're trying to get there. Yeah. So so I you know, for for color, I mean, it doesn't matter if it's Cali or or gallery.
You know, it's for Kallado, which is printing ink on top of our our our materials. So so that the cost added is quite minimum and, you know, that's that's not a big issue for us. For our for our Galloway products, you know, we've we've demonstrated that we can have good margins on it, by selling materials. So So, yeah, so so, you know, gross margin is hard to predict because one day we might start really dropping the price or or, you know, yearly goes down, doesn't go up. But somehow, our our margins have been improving because our efficiency and everything else is really improving.
So so also launching new products also helps with the margins. K. Oh, what are you paying off on?
K. Then next, we have my colleague of Antibodies, partners. For questions, go ahead, please.
Hey, Johnson. Lloyd, can you guys hear me?
Yes. We can hear you properly. Yeah.
Yes. Alright. Thank you.
Okay. Sorry. Sorry about the, and I was, I I'm glad I'm on the call now. Yeah, you know, it's safe for, recorded results. Looks really good.
Yeah, I'm I'm I'm, you know, seeing the share price react the way it has. You know? I think, I think you guys are probably pleased to sell just a few quick questions from me, if that's okay. I sent them a line, but, I'll I'll I'll just say I'll I'll just touch on a few of them if that's okay. One of the ones I wanna ask about is, you know, I understand electronic shelf labels are still very strong.
And my understanding of it is the gross margins on that is around 55 to 60%. I'm wondering if you guys can confirm that. And then second is, you know, from my understanding, speaking to suppliers, like price are, they tell me that the average selling price of one of your labels is around a dollar, you know, on a free 4 inch shelf level, which could cost you $5. So that would, to me, sounds like, you know, you get 20% of the sale. So I I'm just wondering, you know, are those numbers roughly correct, or could you correct me if I'm wrong?
Yeah. Michael, you you know, we can't really give you the didn't run on the exact number. It's we ain't doing it if I wanted to do that. Yeah. So so, I mean, we we look at, I mean, for for years out.
I mean
Call tenant? Yeah. Sorry. They qualify. No.
I I
I really can't give you the numbers for that, and I don't think it's writing, but it's it's It's illegal in Taiwan. The Taiwan Stock Market is good. So it's kinda guidance. But I can I do I can share with you something up? Well, I mean, for yes or modules, I mean, assuming the market pair is under 50,000,000.
I mean, we probably do less than 5 for the end of that volume. And most of it, we sell it at most material materials to our partners and they sell it out at the display logo to the, to the system integrators, like, SES or or, you know, you mentioned price there. Yeah. I got it. And and you mentioned about it.
I was, I'm one of the senior year in your comment. Yeah. I mean, so we really checked our marketing efforts online because of COVID 19. So So we're doing a lot of more online marketing to promote, our technology, to promote the different industry that we wanna go after. So so, yeah, because we're, you know, we gotta repend it to to the situation.
There's less trade show that you can go though. You just gotta do everything online now. And and Yep. Yeah. So so that's that's how how I mean, gotta deal with the situation.
Hey, Jonathan. And can I also be asked about the, the, kind of, the marketing feedback? I mean, when you're using things like, you know, LinkedIn, as I noticed, or Facebook, you know, do you pay any marketing cost for that, or is that only just
free? Currently, I mean, the the stuff I post is is no. I don't have to pay personally. I mean, we don't have to pay, but, I mean, I think corporate wise, there's if you do advertising on Facebook or or LinkedIn, you do have to pay it, though. I mean, we do have a pay corporate corporate based stuff.
Yeah. I mean, I think if any of the
organic kind of, so I was just thinking, is there any, can you give any sense of, like, the organic, you know, customers coming in from, you know, like Facebook or LinkedIn, are there any that are are there any customers actually being attracted from those channels? That's just kinda fair. I'm just trying to think about, you know,
Right. Is that yeah. So so we do see an uptick in terms of people buying our development kit, from our website. So so there's more people buying our development kit maybe because we're launching a lot of new technology, so people are buying more kids from us. I'm trying to understand how our display can fit into their, to to their business plan.
And then then the or their product plan, whether it makes sense or not. So So which is great. I mean, we it's it's I think it's more efficient that way. I mean, So we're actually beefing up a lot of effort that's online, either our website or our line our online shopping, for our case. So we're working on that process, to to service our potential customer, the new customers, people think about using e ink.
Yeah. So that's I think that's that's super important for for new applications. Yeah. Austin, you mentioned about yeah. Go ahead.
So I was just going to ask
a quick question on that was, you know, is there a big marketing team behind that? Like, what, how much can you quantify, like, how many number of people is marketing table. So how do you think premium and decrease? Can you give any sense about that? Yeah.
Yeah. So so I'm working by June is actually when down because we're going to less trade shows. Wow. Oh, yeah. It was down.
I think that your stuff is actually better than when when when we're on the offline. We have that base. I mean, in your team, we have for four people doing it in in in Taiwan, 04, 4 to 5 people doing it. So less than 10 people added. So not a lot of people in that team.
But we're we're also learning how to do more online marketing in China as well because We think that, our color, the paper cut, but the colitis product is, it's actually quite good for the educational market in China. So we're actually, learning to do more online marketing in China
in that space as well. So
So so, yeah. When you mentioned about Barney power, more favorable bargaining power, so you think lots about Bargaining Power. I mean, we think about how do we how do how do we help our customer flow? I mean, how for us, another main topic here today for us is do you make it easier to grow? I mean, our ESR has been growing.
It's organic growth every year it's growing. The TAM is getting bigger and bigger. But how do we get that key leader to start growing again? And we really believe that our color will be a good catalyst to to to get this to grow. But in the short term, it does impact our black and white business because we don't have looked about these right now to serve as the type of demand we're seeing today for the color, so it can be paid to provide a product line.
So we're building up that anything capacity in the in the audio site, as Laura has mentioned. And and but we do believe that Pam will expand and it will help get us into, to the educational space and and really grow the the e reader email market product line and and to grow from there. So I I do believe once we can get that momentum going on the e reader and email part. I think e ink will be in a very good shape.
Thanks, Johnson. And just, maybe just follow on the caller E readers, as you mentioned. You don't have to give me numbers or anything,
but, you know, can you give me any sense of, you know, what the what the
premium is, you know, or or the or high price point you can charge on color versus black and white. Can you give any sense of that? Or
Okay. I mean, so our plan is not to charge more for
a color. Our plan and
turn it in in English market. And and it seems like so far, a lot of our customers are very excited, you know, I think in last call on the conference, you mentioned that we're expecting 2 customers to launch our KALYDO product but ends up being 4 or 5 are announced that's gonna launch a product, and they're doing really well. I mean, they're doing a lot better than they expected a lot better than we expected. We're really trying to build up that capacity. But we're not we're not thinking about charging more.
We already have very healthy gross margins that that we're working with. So trying to get that even higher. It may hinder the market to grow. So that's not our goal. Our goal is to grow that market.
But in the short term, it does impact our black and white because I think our Calano product line, we can still have the same black and white color of black and white experience. That's what we did with a black and white e meter. It was an addition of a color the color is not as saturated, but there is some some color to it. And and so having that a little color, I think it makes a big difference. In terms of visibility and and and the units narrow.
And often, we really improve on our speed. So that responsiveness of using EA technology in a consumer space. I mean, it needs to be very slow, so every time you turn a page you see that big flicker and then you have to wait almost a second. Now we kind of really fix that and and And so we believe our speed is good enough to even play video rate. We're doing 20 frames for a 20 bring you for a second today, and we believe we can bring that even higher.
So so once you get over that that bar of nine things, you can You can do the animation online frame, but getting over that that speed limit. You know, I think it'll yeah. We're excited. And we're we're hopeful we're waiting for the market feedback. Our customer's excited.
But the end of the day is how the consumer responds to this. And that's that's my thing. Yep.
Understood. Maybe just one last question, if I may, for you guys. It's just, I mean, I mean, I I run I recall, you know, like, in the past, you guys had a few competitors and they've kind of gone away. You know, I'm just wondering, do you see any competitive threats to your business at the moment. Like are there any other, like, Chinese players that I should be watching, catching up to you guys?
Or you know, to give me any sense about the competitive?
Beat us out and, you know, take us out the market. I mean, there's a lot of improvement in LCDs and the led, micro LEDs, But we're really targeting a different category. I think our biggest competitors ourselves have if we can elevate fast enough, launching our niche generation of product quicker. I I I'm less work. I mean, I'm I'm not really looking at competition.
I'm really looking at how fast we can come up with the latest technology and really capture the market. So you're seeing a lot of change at the English. At least that's what our customer is telling us. It's like, oh, now you can launch new technology platform a lot quicker than before. Because we spend a lot of time looking internally at how we fix this issue.
How do we launch quicker, you know, the latest platform is quicker. And, I think it's exciting. Exciting. So, yeah, I don't think the competitive focus makes sense. There's some startups I wanna do
is reflect the displays.
So we wanna do color and video. But it's really hard. I mean, our our, you know, can we beat them to a punch, right, and and target an even bigger market. So so I think it's up to us. And especially with the amount of dollars we're spending on R And D, I better hope that we we can take our technology to something that everybody wants.
Yep.
So thanks so much, Jonathan. Nah. Good result. Thank you, Michael.
Hi, Jerry. I stole your question about the, the projected, OpEx So bay basically, with those, you know, supply chain efficiency and, better control on the SG and A, we believe we though, though, those, reduction can compare or offset, the increase in R and D expenses. So, yes, I I I kind of agree with you. The 2020 OpEx, would you say flattish? Yeah.
Basically, I would say Old Texas is in in control, in control.
There are currently no questions. We thank you for all your questions. And I'll pass the call back to the management team.
Hi. Thank you for your participation today. A lot of challenges ahead, but we will work harder and talk to you soon next quarter. Thank you.
Thank you guys, and thank you for joining our investor conference.
Thank you. And ladies and gentlemen, we thank you for your participation in the ink's 2020 first quarter earnings conference call. There will be a webcast replay within an hour. Please visit www.einc.com under the Investor Relations section. You may now disconnect.
Goodbye.