Giga-tronics Incorporated

Thank you, Tiffany. First, I would like to read our Safe Harbor statement.

This conference call contains forward-looking statements concerning operating performance, future orders, development of products, long-term growth and shipments. Actual results may differ significantly due to risks and uncertainties, such as delays with new products, receipt or timing of future orders, cancellations or deferral of orders, the company's Boeing concerns, needs of additional financing, ability to be traded on NASDAQ, the volatility in the market price of our common stock and general market conditions.

For further discussion, see Giga-tronics' most recent annual report on Form 10-K for the fiscal year ended March 30, 2013, Part 1 under the heading Risk Factors and Part 2 under the heading Management Discussion and Analysis of Financial Conditions and Results of Operations.

I will now turn the call over to John Regazzi, our Chief Executive Officer. John?

Thank you, Steve. Good afternoon, and thank you for joining our quarterly earnings conference call.

As usual, I'll make a few brief remarks, and then we'll open the call for questions.

Net sales were $2.9 million this quarter as compared with $2.8 million in the fourth quarter a year ago. Net sales for fiscal 2014 were $13.3 million compared to $14.2 million for the prior fiscal year.

The decreases in net sales were primarily due to the fulfillment of a large order associated with our legacy switching products last year, prior to selling the product line to Teradyne early this fiscal year.

Net loss for the fourth quarter was $1.3 million or $0.25 per fully diluted share as compared to a loss of $1.6 million or $0.31 per fully diluted share in the fourth quarter a year ago. Net loss for the fiscal year 2014 was $3.7 million or $0.74 per fully diluted share as compared to a loss of $4.2 million or $0.84 per fully diluted share in the prior fiscal year.

The lower net loss in fiscal 2014 was primarily due to the gain recorded from selling the legacy switch product line to Teradyne.

Continued investment in the company's new product platform contributed to the losses for the fourth quarter and for the year.

I'd like to remind everyone on the call that the impact of the recent announcements we've made of substantial new orders received by the company are not included in these results. However, while no one here is happy with the numbers just announced, I can tell you management is optimistic about the future.

Our Microsource division is now engaged designing a new version of its EW filter for the F-16 fighter jet. Our expertise in solving the problems that surface when upgrading radar aboard these planes is now well established with the prime contractors.

The majority of this development program is expected to be completed within the next 12 months, and the follow-on production of approximately 300 units is scheduled to begin in early 2016.

Our instrument division has long been supplying its 8003 Precision Scalar Analyzer to the U.S. Navy for their calibration facilities around the world.

The large order we just received will position Giga-tronics to continue supporting the U.S. Navy's requirement for many years while, at the same time, allowing the company to produce and deliver the equipment efficiently.

Finally, the substantial investment we've been making to enter new markets is now about to bear fruit. I've been overseeing the assembly and final testing of the first production units resulting from this investment, and the performance is meeting expectations.

These units will be used to fulfill our first customer orders and to supply our field sales team with the demonstration units to close additional business.

I acknowledge there are challenges that remain going forward, but the new orders we've just received, along with the completion of the first phase of our new product program, will definitely contribute to improving the company's financial performance this fiscal year.

With that, Steve and I would like to open the call for questions.

Okay. I appreciate everyone's attendance on the call, and thank you for your interest in Giga-tronics.