PGIM Ultra Short Bond ETF

Second-quarter net sales were $93.6 million, up 6% from $88.3 million a year ago and up 14.6% from the first quarter. Gross margin was 21.1% versus 23.5% in the prior-year quarter, and non-GAAP operating profit was $2.9 million versus $2.2 million last year; non-GAAP operating margin was 3.2% versus 2.5%. Adjusted EBITDA was $4.8 million, up from $4.0 million a year ago and $1.9 million in the first quarter. Segment sales were Network $42.2 million, Power $28.1 million, and Wireless $23.3 million; wireless operating loss was $1.6 million. Cash and cash equivalents were $24.8 million at June 27, 2014, and total debt principal including discount was $137.8 million, with all debt now in long-term loans maturing in November 2017. No formal third-quarter or full-year financial guidance was provided; management said third-quarter demand appears generally consistent with the second quarter and expects further EBITDA improvement.

Interim CEO Alan Benjamin said the quarter showed Pulse’s strategy working: growing EBITDA through margin improvement, cost and expense reductions, and growth in new channels. He highlighted stronger wireless performance and said the new antenna manufacturing technology is gaining traction with customers, which he expects to add to segment results in future quarters. His tone was constructive but measured, stressing that the company is not relying only on market growth and will keep pushing internal improvements even if industry growth stays modest.

CFO Michael Bond focused on the mechanics behind the quarter’s improvement: sales up to $93.6 million, gross margin at 21.1% versus 23.5% last year, operating expenses down 10.4% year over year, and operating expenses at 18.2% of sales, the lowest quarterly percentage since 2008. He said lower operating expenses more than offset lower gross profit, lifting non-GAAP operating profit to $2.9 million and adjusted EBITDA to $4.8 million. On the balance sheet, he noted cash of $24.8 million, debt of $137.8 million, redemption of remaining senior convertible notes for $1.6 million in cash, and a simplified capital structure with debt now limited to long-term loans maturing in November 2017.

There was no analyst Q&A on this call. Management did not address live follow-up questions, so the main additional color came from prepared remarks: wireless pricing pressure, higher labor costs in China, and supply constraints at a key power customer were the main headwinds discussed. Management also emphasized that demand for the third quarter appears broadly stable versus the second quarter.