Good morning, ladies and gentlemen. Today is Tuesday, September 15, and welcome to the Butler National Corporation First Quarter Fiscal 2021 Financial Results Conference Call. [Operator Instructions] Your call leader for today's call are David Drewitz, Creative Options Communications; Clark Stewart, President and CEO; and Craig Stewart, President of Aerospace Group. I would now like to turn the call over to Mr. David Drewitz. Mr. Drewitz, you may begin. David Drewitz;Creative Options Communications;President: Thank you, and good morning to everyone on the call. Before Mr. Stewart begins, I would like to draw your attention to, except for historical information contained herein, the statements in this conference call are forward-looking and made pursuant to the safe harbor provisions as outlined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause Butler National's actual results in future periods to differ materially from forecasted results. Those risks include, among other things, loss of market share through competition or otherwise; the introduction of competing technologies by other companies; new governmental safety, health and environmental regulations, which could require Butler to make significant capital expenditures. The forward-looking statements included in this conference call are only made as of the date of this call, and Butler National undertakes no obligation to publicly update such forward-looking statements in subsequent events or circumstances. Important factors that could cause actual results to differ materially from the expectations reflected in the forward-looking statements include but are not limited to factors described under the caption Risk Factors in the company's annual report on Form 10-K filed with the Securities and Exchange Commission. So with that statement completed, I'm going to turn the call over to Mr. Clark Stewart. Mr. Stewart? Clark D. Stewart: Thank you, David. Good morning, ladies and gentlemen. We're pleased to have you join us for the first quarter of fiscal year 2021. And we reported a loss of $15,000, which is amazing, given the fact that the casino was closed down for some 65 days in March, April and May. And so part of that closedown was in May, and we still ended up only losing $15,000 overall. Our backlog is strong and around $20 million. We have adequate cash to operate. The casino business, I guess, has opened back up in the last 9 days of May and running 280 machines. And now we're up to 353. We're still experiencing some evenings when we don't have enough machines. But eventually, we will get that taken care of as we get past COVID. The loss this quarter to us is about $1.2 million from the casino. And the cash side of that is not that much, about $660,000. Patrons are returning. They're spending more money per visit. The older market segment is probably the last ones to return. In other words, I'm saying over 65 or 70. That is the fact. But they are gradually coming back. We have actually beat some of the last year's numbers during the last couple of months, which we're really pleased with that, which really says our market is back spending money and visiting the casino. So we're proud of that. Overall, I think we're sound. And we did get some PPP money. I'll let Tad talk about that a little later. We also had some at the Butler level, and we didn't think we'd get any casino money. So the PPP money for Butler National Corporation, we turned back in. And just to -- we have a couple of million dollars as it shows in there from the PPP program for the casino. As I understand it, we have not reported any income or any benefit of that money other than we have the cash and we have the debt. And we still have the expense. So when it's forgiven, that's when it will be reported. As far as the casino goes, that's basically it. Craig, do you want to talk about Aerospace? Craig D. Stewart: Sure. Aerospace was down a little bit revenue-wise this last quarter from the previous year. The $8.9 million we did in the previous year was a really strong quarter. We're seeing a little bit of shift in revenue from the avionics business, and the aircraft modification business is picking up the slack for the most part. The backlog has shifted significantly towards the aircraft modification side. Our business at Avcon is extremely strong right now with significant backlog. Avionics is still continuing to do well, just not at the level it was a year ago. We expect some uptick here over the next few months in the avionics business, but it's remaining solid. And I think we should continue to see good business from the aviation side of things. Clark D. Stewart: Thank you, Craig. From the standpoint of accounting, Tad, do you want to talk about any more on the PPP than what I've disclosed?

Well, just that we received just over $2 million in the PPP loan. That has been shown -- it is shown in current debt, and we have filed for the forgiveness. We believe that we've spent the money in accordance with the guidelines. And so now we'll wait until we hear anything on the forgiveness, which could be approximately 5 months. At that time, if we receive forgiveness, then that amount of that PPP loan would fall and show up into other income when we receive the forgiveness, and it may be for 100% or some percentage. We don't know at this time what that will look like. Clark D. Stewart: Thank you, Tad. I would point out to you that the overall loss of the casino is approximately $5 million total for the 65 days. So it is expensive to have nothing happening. As far as recognition of any of that, like Tad says, we're not going to do that until later. As far as the buyout of the land and building, as you know, that's dependent upon the -- I guess the actions of the COVID, I would say, really the attitude of the people in the Midwest relative to COVID. Currently, we are underway, moving forward. And then I would tell you all that's subject to what's really happening with the virus. But I think we are definitely moving. The bank is moving, and there's something happening now. When it's going to close, I don't know the answer to that. So with that, I think that we have a positive quarter, even though we lost $15,000. Is there anything -- any other comments? Chris, do you have anything? David, I think we're ready for questions. David Drewitz;Creative Options Communications;President: All right. Great. Let's open it up for questions.

[Operator Instructions] And our first question comes from Sam Rebotsky at SER Asset Management. Sam Rebotsky;SER Asset Management;Founder: Clark and Craig, tell me -- as far as the avionics, the sales were reduced. Number one, did we have the same number of employees, cost of the production was basically the same with less revenue? Clark D. Stewart: Do you want me to answer that? Craig D. Stewart: I can do that. Basically, the -- from an avionics segment, some of that is a little bit of timing of when we ship things out in Arizona. But basically, we have the same number of employees from an avionics standpoint as we have -- plus or minus 1 or 2, depending on where we are. It's a little bit cyclical. We -- as a company, we've never been a company that is -- things get drop off temporarily. We don't make a big [ decision ] to lay people off because it's hard to get the skilled labor back. So we basically will hold on to the employees, knowing that the business is a little bit cyclical. And then when it comes back up, we need those employees to be able to meet the demand that we're going to have in the near-term future. Sam Rebotsky;SER Asset Management;Founder: So is -- yes, yes. Clark D. Stewart: I think the other thing that we don't do is percentage of completion in Tempe. And so we get some bumps there because we have a large number of units and then they're shipped and the revenue comes in or we may have a month or 2 where we are building up the supply for that order. You've got to realize these orders are million-dollar type orders. So they -- we may have to think about whether we do percentage of completion there. Sam Rebotsky;SER Asset Management;Founder: So some -- yes. So do we -- we don't defer expenses that we might have on the work that's not shipped? Clark D. Stewart: Yes. Go ahead and answer. Craig D. Stewart: Well, I mean, they -- cost directly to that unit is in there, but these are pretty high spread margin units. So the cost goes into inventory, work in process or finished goods inventory for raw materials, but we don't recognize the revenue. And the [ margin ] on avionics is very high on some -- or it's very good margins on some of the stuff. So that margin isn't recognized. Clark D. Stewart: The costs are deferred as the units are built, Sam. As -- and then when we ship them, we recognize the revenue. So you're going to get the cost occurring in inventory. And it's sitting there on the books waiting to be matched to the revenue, and then the revenue comes in, in months. And so that's why the profit varies. Sam Rebotsky;SER Asset Management;Founder: And so the -- yes. The backlog that we have, has that been increasing proportionately as we get to the end of the July period? Or is there more work that we're bidding on? Or how is the backlog coming along and the work in avionics? Craig D. Stewart: The avionics backlog is probably down from, a little bit, where it was a year ago. We've shipped a lot and haven't taken as many new orders there. We're hopeful that we'll get a couple of new orders here over the next couple of months that will push that backlog back up from an avionics standpoint. The modification segment backlog has been increasing over the last 6 to 9 months pretty steadily. And it's a good chunk of -- it's probably almost 75% of the backlog for the company at this point. Sam Rebotsky;SER Asset Management;Founder: And this is -- yes, yes. Clark D. Stewart: One more piece to that. A lot of these customers for the modifications are coming from overseas. And the travel situation with COVID is causing that schedule to be a little more than smooth, it's rough. Because they can't go to some countries, they can't stop for fuel or they'll get quarantined for COVID and all kinds of stuff. So we've been trying to work around that to get some of that, the flow a little better. So if you're coming 2,500, 3,000 miles to get to Newton, Kansas, you've got your work cut out for you, especially these special-mission type airplanes. Sam Rebotsky;SER Asset Management;Founder: Okay. In the gaming area, is there any way that we could sort of work to take bets, et cetera, like some of the other -- like 10 and various other gaming companies? Does that fit into the Kansas model? Do we know -- firstly, are we allowed to take bets? Number two, would we need somebody to do it for us? Or what's our thought about that? Clark D. Stewart: We can take bets within the casino brick-and-mortar, if you will. And no sports betting, but I'm saying we can take bets. So now if you look at that relative to sports betting, we're not authorized. That isn't a Kansas Lottery facility game yet. So that's not -- that hasn't been defined. So none of the casinos are doing sports betting or any kind of online betting at this point. Sam Rebotsky;SER Asset Management;Founder: And so there is -- is there a plan to look to do that with -- even though -- with the gaming improving but slowly, that we've lost the 65 days, is there any thought in Kansas to allow sports betting as this seems to be -- with the travel problem, would be another avenue of revenue and profitability? Clark D. Stewart: That's really not up to us. That's up to the Kansas Lottery and the Kansas governor and the legislature in the State of Kansas. It was talked about last year, and it will, I'm sure, come up this session. And we'll see what happens. We don't really have much to do with that. Sam Rebotsky;SER Asset Management;Founder: Okay. All right. Hopefully, this quarter will be more profitable and we'll have a rational -- more people who -- I guess as far as buying stock, with the stock down at this level, has Butler been buying stock as they had needed stock earlier? Clark D. Stewart: We have been buying stock back, yes, as it is presented, coming from the states and other things like that. Where they contact us, we have been doing that, and I believe those numbers are in there.

Yes. And I think we purchased 212,000 shares this quarter. We only have this quarter -- since our open period is when we filed the K to the end of the quarter, which was about 2 weeks this quarter, we only had 2 weeks to purchase shares. Next quarter, we'll have about 45 days. Clark D. Stewart: We're in a period right now where we can buy shares again. Sam Rebotsky;SER Asset Management;Founder: All right. That's good. That's good. All right. Hopefully, things improve and get to be greater profitability. Good luck, gentlemen.

[Operator Instructions] Clark D. Stewart: David, it sounds like we don't have any more questions. David Drewitz;Creative Options Communications;President: It doesn't appear so. Clark, any closing statements? Clark D. Stewart: No, I just want to thank everyone for taking their time this morning to listen to the Butler National story. We think it's a positive quarter. And hopefully, we've survived the worst of the COVID situation and we can move forward to continue to develop the business. Thank you for taking the time. David Drewitz;Creative Options Communications;President: Thank you, everyone.

Thank you. This concludes today's conference call. Thank you for attending.