Varex Imaging at Sidoti Conference: Strategic Growth Amid Challenges

On Wednesday, 19 March 2025, Varex Imaging Corp (NASDAQ: VREX) presented at the Sidoti Small-Cap Virtual Conference. The company outlined a strategic plan to navigate current challenges and capitalize on future growth opportunities. While Varex is dealing with issues such as tariffs and market uncertainty, it remains optimistic about its prospects in photon counting technology and cargo inspection systems.

Key Takeaways

• Varex is diversifying its supply chain and expanding manufacturing to India to mitigate tariff impacts.
• The company aims to reduce gross debt to between $300 million and $350 million.
• Photon counting technology and cargo inspection systems are expected to drive significant revenue growth by 2029.
• The impact of China’s anti-corruption campaign is subsiding, with gradual improvement in OEM customer sentiment.
• Varex is investing in AI technologies, particularly in lung screening applications through its Mavis unit.

Financial Results

• Refinancing and Debt Reduction:

- Completed a $125 million add-on bond, recorded as restricted cash.

- Plans to use the bond proceeds and remaining cash to pay down a convertible note.

- Targeting a gross debt reduction to $300-350 million from the current $370 million.

- Aims to maintain a net leverage ratio below 3x adjusted EBITDA, currently at 2.5x.

• Cash Flow and CapEx:

- Historical cash flow generation ranges between 80% to 120% of adjusted net income.

- Capital expenditure projected at $30 million for fiscal year 2025, elevated due to India plant investments, before normalizing to $20-25 million annually.

Operational Updates

• China:

- The anti-corruption campaign’s impact is largely behind, with a positive shift in OEM customer sentiment.

- Destocking issues have been resolved, with an uptick in order intake rates.

• Tariffs and Supply Chain:

- Varex is better positioned against tariffs with a diversified supply chain and local manufacturing capabilities in the US, Germany, and China.

- The India plant will begin manufacturing detectors in Q3 of the current fiscal year, pending regulatory approvals.

• India Plants:

- Detector plant expected to supply products by the end of fiscal year 2025, and tube plant by the end of fiscal year 2026.

Future Outlook

• Growth Opportunities:

- Photon counting technology projected to contribute $150 million by 2029.

- Cargo inspection expected to become a $100 million+ revenue segment within 3-5 years.

- Plans to regain share in the radiographic market with India plant production.

- Continued focus on AI applications, particularly in medical imaging.

Q&A Highlights

• CEO Sunny Samuel noted the stabilization and uptick in order intake rates.
• CFO Sam Masheshwari emphasized plans to reduce debt with excess cash, aiming for a gross debt range of $325-350 million.

Readers are encouraged to refer to the full transcript for detailed insights and additional context.

Full transcript - Sidoti Small-Cap Virtual Conference:

Jim, Analyst: Hi. Good afternoon if you’re on the East Coast. Good morning if you’re on the Out West. The next company presenting at the conference is Verix Imaging. With us, we have the CEO, Sunny Samuel, the CFO, Sam Masheshwari, and the director of investor relations, Chris Beltziori.

So, this session will be a fireside chat, and we’ll just get started. Verix is a name that I’ve covered now for probably about seven or eight years. Company makes primarily components for digital x rays, both the detectors and the x-ray tubes, with about 30 ish percent of their business industrial and the other 70% in the medical side. So Sam and Sony, you know, can you give us an update on China? That was a big issue in the last fiscal year.

Sales were hurt by the anti corruption campaign and also the weak economy there. You know, what’s going on with those? And and do you expect those headwinds to, to subside a little bit in fiscal twenty twenty five?

Sunny Samuel, CEO, Verix Imaging: Jim, I’ll I’ll comment, and then I’ll ask Sam to chime in with any perspective from his side as well. You know, look, what we’re seeing is that the bulk of the impact of the anti corruption, campaign that the Chinese government had launched was largely behind us. There’s still a trailing effect of that. It hasn’t ended fully. They have left behind a longer term program.

So there’s the effect of some of the slowdowns that we saw that we’ll see lingering effects of that. But generally speaking, the buying behavior seems to have opened up. And at this point overall, as we talk to our OEM customers in China, their sentiment is more positive versus negative. You know, like, we could see we could see some optimism and enthusiasm in their sentiments. But as as we’ve said before, we’re ex we’re not expecting a snapback.

We’re we’re expecting a gradual improvement. And so we don’t think we still don’t think that it’s going to go backwards. Now things happen, things can happen, but we expect it to be an ongoing positive traction. On this at the same time, from the broader economy perspective, you know, the the economy, we didn’t see any economic indicators that gives us any belief that there will be any kind of a snapback either. The stimulus program, you know, it’s it seems to be making its way through the economy, but none of our OEM customers in China have are able to correlate the increase in demand, their sales with with whether it’s just natural organic secular demand from the hospitals versus anything to do with stimulus.

There was really no one who could really pinpoint and said, well, in this province, it was a result of the stimulus. But they all acknowledged that the stimulus is directed towards upgrading of equipment and that should be a positive thing. And the timing and effect of when that will really have an effect still remains unclear.

Jim, Analyst: Okay. Alright. Another issue last year was, is that some of your OEM customers would destock and they had built up a lot of inventory during the the prior year because of all the supply chain issues that were out there, and as a result, they delayed some ordering. Is the inventory at your larger OEM customers, do you think that’s back to normal levels and you think orders come back to historical levels?

Sunny Samuel, CEO, Verix Imaging: Well, we’ve seen we’ve seen an uptick in the order intake rate. It stabilized during our fourth quarter and during the first quarter, we saw an uptick. And that trend for us as we’ve correlated that back, gone back to to our OEMs and triangulated that them. It’s a it’s a clear result of them having pretty much, gotten back to their normal inventory levels. So we think this the destocking event is largely behind us.

Jim, Analyst: You know, one of the issues that seems to have come back, with with the new administration is tariffs, and I know you dealt with this in 02/2018. Can you talk about any potential impact on tariffs this year? Are you in a better position than you were in the last time, when tariffs came up?

Sunny Samuel, CEO, Verix Imaging: Yeah. Let me start there with that last part of the question. So, versus 2018, ’20 ’19 time frame, we’re we feel we’re in a more, a more robust position, from in terms of being able to deal with it because we have a more diversified supply chain. In 2018, it was all about our suppliers in China and we had created a large base of suppliers in China, low cost suppliers. Now, since then, we’ve made alternative, we’ve qualified alternative suppliers in Europe and in other parts of Asia, like India, for example.

So we feel we’re in a better position to withstand the effect of tariffs. And then, in terms of operations as well, our operations in China are much farther along and it’s pretty much self sufficient for what we need to do in China itself. I’d say when I say self sufficient, I mean, you know, we do certain parts into China. We have exemptions for those, but what we make in China, we can, you know, we have a much broader portfolio of what we make in China for Chinese customers. So we’re in a better position operationally.

And at that same time, if you look at where the competitive intensity is high for us, which is in detectors, We’ve got full capability to make detectors in The US, in Germany and in China. So that puts us in a good position. And lastly with India coming online fairly rapidly in the near future, very near future. We will start, to see manufacturing. So in fact, in the third quarter of this year, we should start to see manufacturing of detectors, in India.

They’re already the factory’s already up and running. We’re going through the regulatory approvals for it. That gives us yet another alternative to be able to supply, detectors globally from from India. So we’re in a better place. We’ve also done our analysis and assessment of the cost impact of the tariffs.

When you look at the direct purchases, the what we buy in, in The US from supplies from outside The US, like China, that that impact of the direct impact of tariffs on the direct purchases is not significant at this time. So so that’s that’s one part of it. The second part of it is, well, what about the indirect? What we buy from US suppliers and then their suppliers and their suppliers. That we’re trying to still understand and assess the impact of because that’s very tough.

Most of our suppliers don’t have a good line of sight to all the entire depth of their supply chain. What we are expecting is we’ll see some of that in the form of cost increases from our suppliers. And at this point, our intention is to pass that on to our customers. So we’re making the we’re we’re doing what’s needed from an infrastructure perspective so that we can track that and be able to account for it and to be ready for to take advantage of any duty drawback programs or any other, opportunities for for gaining exemptions that, that we might be able to get. So our strategy is three prong.

One is make locally wherever it makes sense to avoid all these problems to begin with. We will seek out exemptions where feasible, where possible, where exemptions are made available. We have confirmed that our Chinese, the exemptions that we get in China are going to continue. The new retaliatory tariffs did not have any implication on our products. On The US side, you know, the exemption programs, the old exemption programs are in place still.

And then there are there are no new exemption programs yet, but we have begun the process. So we’ll go for exemptions first. If, second, we’ll see if to the extent that, that we have alternative suppliers, we’ll switch to alternative suppliers and redirect the supply from those alternative suppliers to avoid any any, tariffs that might have, that might impact us. And thirdly, the rest, we will pass through. That’s the approach we’re taking.

Jim, Analyst: And you mentioned the new plant in India. How long did it take to get that plant up and running for detectors? And when do you think you’ll be able to supply, the x-ray tubes from that plant?

Sunny Samuel, CEO, Verix Imaging: Yeah. Let me ask Sam to respond to that. Sam is in the middle of all of that.

Sam Masheshwari, CFO, Verix Imaging: Sure. So, we are building two plants in India, Jim. One is for detectors and one is for tubes. The plan for detectors, we are expecting to start supplying products from there towards the end of fiscal twenty five. And we’ve been working on getting that up for almost a year now.

And then the plant for tubes, it has a little bit more, more more construction and more work to do with it. That also, actually, we’ve been working on now for more than eighteen months. That plant is expected to produce towards the end of fiscal twenty six for us.

Jim, Analyst: And do you think the products made in that plant, will they be sold primarily in Asia or will those be available worldwide?

Sam Masheshwari, CFO, Verix Imaging: Initially, our strategy is to produce in India for global consumption depending upon the customer location and customer preference. Eventually, we believe the India market will grow and we should be we should be and we hope to be able to supply India market demand from those plants. But initially, our approach is India production for global consumption. And in the tariff situation, like Sunny was saying, tariff world, it does provide us a good option to provide products from India for certain products, where we can avoid tariffs. Because India generally is more in a neutral situation with many countries, so we are hoping that the tariffs can be avoided if we are able to produce from India.

We will have to see.

Jim, Analyst: Alright. We’ll switch gears a little to, the photon counting technology. I know this is a technology you started investing, I think, about four or five years ago, with the acquisition. You know, how are the products based on this technology going, on both the industrial and the medical side?

Sunny Samuel, CEO, Verix Imaging: At a summary level, Jim, we we sell about 20 to $25,000,000 worth of photon counting detectors currently, and that’s that’s increasing. The uptake has been as we had expected much more rapid on the industrial side as it tends to be and there’s less regulatory hurdles and other things to go through our our big play in the photon counting space is on the medical side, particularly with medical CT. So in medical in general, we have seen a lot of interest across many different modalities and we are engaged with, you know, with our OEMs in as they design new modalities or new applications with photon counting and that we’ll see such as in different forms of radiographic or mammography or bunch bunch of offerings. That’s sort of as as I’d call it, our ongoing typical OEM medical business. Our main focus has been for downcountings for CT.

And CT detectors is a new space for us, new addressable market. There, as we mentioned in our earnings call the last time, which is we’ve got one global OEM that is fairly solidly on track with their plans, with their programs, with their R and D plans and ours as well working with them. And they’ve got launch dates in mind. They’re marching towards that. We’re working with a couple more OEMs that are, that are in sort of the different stages of the sales process.

One is further along than the other one. And that’s that’s so far the progress that we’ve made that I can I can call out, and hard to get into any more detail than that because these OEMs are extremely sensitive about their plans and what they’re doing? And we’ll we’ll continue to keep the our, you know, our, investor base updated on on progress as we feel appropriate when we reach certain milestones.

Jim, Analyst: And what’s the advantage of this technology over the technology that, you know, the traditional technology used on detectors?

Sunny Samuel, CEO, Verix Imaging: The benefit of photon counting technologies, particularly in CT is first and foremost, very high resolution Imaging, high resolution, high contrast Imaging at a significantly lower dose. That is sort of to start with. That’s sort of the Baseline. Secondly, with the technology, the way it is, the way it’s designed, it enables very much more precise material discrimination. So the longer term clinical in the longer term clinical applications can be designed where they potentially could cross over into other modality areas with better soft tissue resolution areas that cross boundaries of different kinds of imaging applications today.

That’s sort of the longer term holy grail of this technology, better use of the material discrimination capabilities.

Jim, Analyst: Alright. One of the areas where your business is, has accelerated recently is cargo inspection. And, you made a decision, to to supply complete systems. Whereas in the past, you were you were selling primarily components. You know, what was behind that decision?

Sunny Samuel, CEO, Verix Imaging: So, Jim, we, first as a background, this is an area that we’re very familiar with from a technology perspective and also, overall ability to, develop and implement systems. We long back, we used to make the full systems and we do still do have, a lot of systems installed between The US Mexico borders that that were designed and implemented by by our company when it was originally part of Varian, you know, long time ago. So it’s not an air brand new area for us. We know this area this space. That said, in the re in recently, a few years ago, we just, as we started looking at the space, particularly during the downturn where post COVID when there was, we saw that there was a gap.

But then now as we look at the overall market space, we see it as being very large, very active. There’s quite a bit of opportunities. We decided to get reenter the space with our, full systems because we were already selling full sub assemblies. Like, we sell the x-ray sources, the linear accelerators. We sell detectors.

We sell the software for acquisitions. So we decided to go into it ourselves, in with full systems offerings. And the in addition to selling the equipment, the the so the ongoing value for being in it ourselves directly is that we also get to access the services side of this space that is also a pretty substantial opportunity.

Jim, Analyst: And and as tariffs are implemented with Mexico, do you think that will spur demand for these types of systems?

Sunny Samuel, CEO, Verix Imaging: I think two things are, spurring demand for these these types of systems. One is, the world has become less secure, and there’s just ongoing conflict everywhere. And that is, that’s that’s number one. So there’s, quite a bit of demand for for from a security standpoint. Secondly, yes.

With tariffs, you know, the the fact that also these linear accelerators are capable of, very good material discrimination. It allows for applications. By the way, our customers have used our have been using our linear accelerators to do this, where they they use the technology to compare what’s in the container versus what’s in the manifest. If the container says it’s should be potatoes, and if it’s something else, you know, it looks like something else. That’s a one particular use of this technology, which now with tariffs potentially that becomes a more, a more important feature.

And we haven’t seen a direct correlation between tariffs. It’s too new to tell, too early to tell. But what we are seeing is that there’s a pretty substantial demand for for these systems and there’s a lot of tender activity. Now we have our brand for us. We have the competency and the capability.

Our brand is very well, recognized and respected. Our technology, you know, it’s installed in over 1,500 sites globally and customers know that we have deep domain knowledge in this space. So we do get visibility to the tenders. You know, people, the market has, has the receptivity in the market has been good. And we’re one of the only two players that are fully vertically integrated in this space.

So that makes us, very good, very good player in this space.

Jim, Analyst: Alright. Another area where you’ve made some investments, another new technology is the nanotube technology. I know you have, right, you have agreements with a company called MicroX, and now last year, you announced another agreement with NanoX. Can you tell us how far you are in the development cycle for these types of products? And I guess start off with what what’s the advantage of using this technology?

Sunny Samuel, CEO, Verix Imaging: Yeah. So nano nanotube based X-ray sources are a a a way to build x-ray tubes where you don’t need a heated filament. So imagine this like a solid state x-ray tube. The old vacuum tube based, electronics versus, solid state transistor based, like, you know, electronics, a similar analogy. So now you have the cold cathode, which can turn on and off without need the need to be heated, more of just like a semiconductor.

It can be switched on and off to very high speed like you would with semiconductors. The advantage of that is you can build x-ray tubes with multiple emitters that can be switched on and off very rapidly. And you can using that technology, you can significantly simplify imaging applications where where there might be movement and you don’t need the movement. Like in a mammography system, when you have, you take 25 projections and to do that, you have to move the whole gantry or in a CT where you have to rotate or in a c arm. So there are applications that where there are opportunities to dramatically simplify speed up those systems using this type of technology.

That’s the in a 50,000 foot level, the potential benefits of this technology. Simplification means cost reduction. Simplification of the of the hardware means you could conceive new images in a way that might not have been practical previously because of geometry or mechanical motion things like that. So that’s the, in a nutshell, the benefit of this type of technology. The the, where we are with it is that the technical feasibility of both the technology itself being used for to generate x x rays, our ability to manufacture them, the life and all of the sustaining, whether this technology can sustain itself, can we make it in scale, will it withstand the demands of x-ray imaging?

We are satisfied with that. We’ve had quite a bit of work already done over the last four, five years to establish technical feasibility. We’re at that stage now where we are getting OEMs to understand this. We are shipping prototypes to them so they can characterize this and play with this. There’s quite a bit of interest in it, largely from a lot of, the smaller OEMs who are trying to envision the highly differentiated new applications.

This technology is further behind in terms of market adoption readiness versus photon counting. So it will be a few years behind photon counting in terms of our, you know, our seeing new, OEMs bring this technology to market. That said, companies like by the way, we’re done with the technology transfer with MicroX. We that that’s all done in place. We are in in full independent development and production mode ourselves.

We did announce that, partnership with, NanoX that, Nanox, that’s our, our typical OEM customer. We have an agreement to make tubes for them, and that’s that’s that’s moving along well.

Jim, Analyst: So, I mean, it seems to go on the same theme though. It’s better images using lower power. Yeah. Similar to photon carbon.

Sunny Samuel, CEO, Verix Imaging: Yeah. And our our, our stick with this is that the combination of nanotube based, X-ray sources and photon counting create gives the world an opportunity to make really, really interesting novel imaging applications. And we’ve, as Verix, have both those technologies together.

Jim, Analyst: Okay. You know, another trend in your space is artificial intelligence, AI. I know, GE’s you know, they just announced yesterday, I think they’re using AI for, for ultrasounds. They they announced a deal last year. They’re using AI with their smart memo systems.

You know, are are you investing in AI? And, do you think this will be a trend that will be helpful to Verix?

Sunny Samuel, CEO, Verix Imaging: Our investment in AI has been through our Mavis, Mavis business unit, which is, you know, we own 73 percentage shares of, Mavis. And our foray in it is, twofold. One is in in AI, applications in lung screening. So we have full blown workstations, and we’re bidding in tenders going directly to, to end markets where there are country level tenders. So we’ve talked about our wins in Canada and we’re bidding on tenders, lunch screening tenders in other global markets.

And at this time, you know, we have plans to continue to incorporate AI technologies in other application areas and we, you know, we certainly, you know, we haven’t disclosed publicly some of those, but we will continue to work with those, the AI applications with using the Mavis resources and their competencies.

Jim, Analyst: Alright. I’ll give Sam a chance to ask a question on the balance sheet. You know, when I first picked up the company, you know, they were talked about violating debt covenants and and, things have just improved dramatically, you know, over the past few years on the balance sheet. And I know you did another refinancing a few months ago, but, you know, what are your plans now regarding debt pay debt paydown and and the overall debt structure?

Sam Masheshwari, CFO, Verix Imaging: Sure. Thanks, Jim. So, you know, we we did a refinancing or actually we did an add on bond for $125,000,000 It is recorded on our balance sheet as restricted cash. So we plan to leverage this $125,000,000 and also remaining cash from our balance sheet to pay down the convertible note. This is our intention.

Final decision has not been made towards this, but we are getting close to that decision day and within within a few months here, we we need to pay down the debt. But that is that is the direction we are headed. So with that, we would have taken care of the convertible by paying it down with cash from the balance sheet and not to convert the convertible or refinance the convertible into a new convertible. Okay? And then secondly, in terms of gross debt, the remaining piece would be the one high yield note that we have.

It’s currently at about $370,000,000 total notional. Our plan would be with our excess cash over time to pay it down somewhat a little bit. Ideally, I would like Cruise debt to be in the $325 3 50 million dollars range. And then in terms of total leverage ratio or net leverage ratio rather, as a factor of adjusted EBITDA, we would like it to remain we would like it to be maintained below three. Currently, we are around two and a half, somewhere around that.

So we have some room, but, we would continue to have a conservative financial policy in terms of maintaining low leverage ratio. Our business should have some leverage, Jim, as you know, because we have a decent amount of revenue, which is recurring revenue. And then within our recurring revenue, there is a decent piece, which is replacement or service oriented revenue. So from a capital perspective, we should have some debt. Ideally, I would like it to be in the 300 to $350,000,000 $350,000,000 range.

Jim, Analyst: Right. You know, you’ve invested in India. You’ve made some investments to build up inventory, you know, in past years. You know, what do you think this year looks like in terms of cash flow? Do you see an uptick in capital spending?

Do you see an uptick in working capital spending? Or do you think you’ll get cash from working capital in fiscal twenty twenty five?

Sam Masheshwari, CFO, Verix Imaging: Yeah. We do not guide in terms of cash because as you know, cash can be very volatile. However, if you look at our historical performance typically from net income adjusted net income to cash flow generation ranges between 80% to 120% in that range 0.8 to 1.2 I do not expect anything that is going on in this year that would change it. So that’s in terms of the overall way we look at the year. It is true you highlighted about

Sunny Samuel, CEO, Verix Imaging: our investments in India. FY ’25

Sam Masheshwari, CFO, Verix Imaging: is a significant year in India for us as we get these factories up and running. So CapEx is expected to run close to $30,000,000 for fiscal twenty five and also run a bit heavy next year, which is fiscal twenty six. But once these two years are passed, we should come down to our natural CapEx rate of, say, 20 to $25,000,000 a year, you know, low twenties. That’s what has been our natural CapEx run rate, which we and we should come down to that beyond the two years of slightly higher CapEx.

Jim, Analyst: Right. And I think we have time for for one more. You know, if I just look at your business, you you had a couple of major headwinds. The the the anti corruption campaign and and the destocking issues have have at least normalized at this point. You seem to have an opportunity in cargo inspection right now, but it doesn’t feel like it’s at all reflected in the stock.

I mean, the stock is near its lows for the past couple of years. What can you tell investors? What do you think is happening to give them confidence that you’re past these things and and that you think, company’s in a good position going forward.

Sunny Samuel, CEO, Verix Imaging: So, Jim, let me again, I’ll pass Sam to compliment my or supplement my response. Few things. First of all, we are seeing an order, intake rate improvement, which gives us confidence that the destocking is that phenomena was was, industry wide, but that’s that’s behind us. So number one. Number two, we’re seeing, where our sentiment on China is, I’d say, more on the positive side versus neutral or negative.

So we we expect to see that continue to improve. So the prognosis, there, we’ve talked about thirdly, the areas where we are investing, there are three areas that we’re investing in that are all a hundred million dollar type of opportunities for new areas. We are Play in India is all about radiographic to gain share back in radiographic, and we expect that to be $100,000,000 type of product line. We talked about photo and counting. By 2029, we expect the contribution from that to be in the range of $150,000,000 And the third one, cargo, we expect that to be also a $100,000,000 plus type of revenue contributing segment over our product line over the strategic planning, this three to five year horizon.

So those are three big areas where we are seeing positive traction in every one of those areas. Radiographic, it’s, it is in our domain. It’s up to us to get the the factories is getting there very in short order, it’ll be up and running. Even before that, we’ll be able to ship those new radiographic detectors from, Salt Lake City. So that’s in our control.

Cargo is, is we’re playing actively heavily. We’ve talked about some wins. We’ve talked about several installations that we’ve made. So there’s traction, ongoing progress, and we’ll continue to give visibility as we win deals. And a photon counting, that is the longer play because it’s a more complex modality like in CT, CT detectors.

That the good news there is once you’re in in once you’re, designed in, even though it takes a while, once you’re designed in, it’s a twenty plus year type of a play. So that’s what excites us, and I don’t think that’s reflected in this talk.

Jim, Analyst: So so do you think it’s just concern over the tariffs? I mean, because it it you feel it feels like you are in a much better position

Sunny Samuel, CEO, Verix Imaging: Yeah.

Jim, Analyst: Than you were six, seven years ago.

Sunny Samuel, CEO, Verix Imaging: There’s always the fear of the unknown that I think continues to plague us with whether it’s tariffs, whether it’s China. We’ve talked about our position in China being being strong because of the way we are designed in. China Twenty you know, there was concern about China Twenty Twenty Five. Well, we’re halfway through 2025. And, we’ve always said that we’ve made plans with our Wuxi operations and production.

Thirdly, you know, in terms of the tariffs themselves, the direct, we’ve said the cost impact of that is not significant. And secondly, in the retaliatory tariffs that we’ve seen from China, they do not impact our the healthcare products. And even what we have in place is gonna continue to receive exemption. So I do think it’s a little overdone for us, you know, and certainly the sell off that we saw after the after earnings call was not warranted in that sense either. So Mhmm.

Look, I’m I I I I’m disappointed that the stock hasn’t reflected all the good things that, we’re talking about here.

Jim, Analyst: Alright. Well, you know, the earnings the next earnings call is feels like it’s just around the corner again. So, I’d be looking forward to talk to you, get an update on these issues, and see how things, you know, played out in the second quarter.

Sunny Samuel, CEO, Verix Imaging: Alright. Thank you,

Jim, Analyst: John. Thank you, James. Thank you for the time today. Thanks.

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