Core Molding Technologies Inc

Good morning, everyone. Welcome to the Core Molding Technologies first quarter fiscal 2024 financial results conference call. Today, all participants will be in a listen-only mode. Should you need assistance during today's call, please signal for a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask your questions. To ask a question, you may press star then one on your telephone keypad. If you would like to withdraw your question, please press star, then two. As a reminder, this conference call is being recorded. I would now like to turn the call over to Sandy Martin, three-part advisors. Please go ahead.

Thank you, and good morning, everyone. We appreciate you joining us for Core Molding Technology's conference call to review first quarter results for 2024. Joining me on the call today are the company's president and CEO, Dave Duvall, and EVP and CFO, John Zimmer. This call is being webcast and can be accessed through coremt.com via an audio link on the investor relations, events, and presentations page. Today's conference call, including the Q&A session, will be recorded. Please be advised that any time-sensitive information may no longer be accurate as of the date of any replay or transcript reading. I would also like to remind you that the statements made in today's discussion that are not historical facts, including statements or expectations or future events or future financial performance are forward-looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. By their nature, forward-looking statements are uncertain and outside of the company's control. Actual results may differ materially from those expressed or implied. Please refer to today's earnings press release for our disclosures on forward-looking statements. These factors and other risks and uncertainties are described in detail in the company's filings with the Securities and Exchange Commission. Core molding technologies assumes no obligation to publicly update or revise any forward-looking statements. Management will refer to non-GET measures including adjusted EPS, adjusted EBITDA, debt to trailing 12 months EBITDA ratio, free cash flow and return on capital employed. Reconciliations to the nearest gap measures can be found at the end of our earnings release. Finally, this release has been submitted to the SEC on Form 8K. Now, I would like to turn the call over to the company's president and CEO, Dave Duvall.

Thank you, Sandy, and thank you all for joining us to review our 2024 first quarter results. I want to start today with some positive highlights related to our core molding team in the first few months of 2024. This spring, CORE was presented with BRP's Gold Supplier Award related to its Sea-Doo boats and personal watercraft models. BRP, or Bombardier Recreational Products, is a global leader in power sports vehicles on land, water, and snow. I'm proud of our team, and we are honored to be one of BRP's key suppliers for the Sea-Doo personal watercraft and the Sea-Doo switch. Our team has been awarded this prestigious recognition for CORE's manufacturing and logistics excellence, high quality products and processes, and superior customer service. Being recognized as a gold supplier is a culmination of the complete business transformation that we've been executing and communicating over the past several years. I am proud of what the team has accomplished and the magnitude of this accomplishment can be seen in our tremendous improvements in our basic metrics. For safety, we reduced our incident rate by 44% in the last two years and are much better than the industry average. For people, we continually improve our focus on individual and organizational development, which is reflected in our low turnover of salary team members, now less than 12% annualized. We've implemented annual leadership development programs, organizational and career development programs, technical certification programs, along with many other training and employee engagement initiatives. Employee development is and always will be a key focus area for core molding. In quality, we've reduced our customer PPM by an incredible 89.6% in the last four years and 17% in the last two years. In delivery, we improved our on-time delivery by 21% in the last two years and are now at 99% on-time delivery. We have reduced scrap and rework costs by over 51%. We increased our production capacity by over 20% with existing assets and made strategic investments in our plants to increase capacity through efficiencies, automation, facility improvements, which increased our total current capacity to between $425 million and $475 million in annual sales. We first significantly improved our customer support and service levels, which then enabled us to make the necessary changes to our pricing to bring prices back in line with market rates, which provides the financial resources necessary to continue to improve our operations and customer service levels. As a company, I believe we're in the best overall business operating condition in company history. Our focus has been on implementing robust business systems throughout the transformation. I am confident that our improvements are sustainable and that we have some of the highest service levels in the industry. The company has the organizational capability, operational infrastructure, and financial stability in place to drive revenue growth through new programs, acquisition opportunities, and existing programs as demand levels rebound. We have prepared the organization for growth. The engine is ready. And now we're at the invest for growth phase, or better stated, our must-win battle is now invest for growth, which I will talk about later. I'm also excited to share that we have published CORE's second sustainability report, which shows solid progress from last year. This comprehensive report, published on our website, offers an overview of our sustainability strategy and provides all CORE stakeholders with a view of our progress against established goals and commitments. Sustainability is embedded into our values in business and is instrumental in driving organizational change that reduces both enterprise risk and costs. Also important is that our sustainability systems allow core molding to be a part of something bigger than ourselves by providing a structure for our organization to support environmental stewardship. Our second annual report details accomplishments in 2023 and progress on our important 30 by 30 targets. We intend to reduce our company's energy consumption, greenhouse gas emissions, and landfill waste by 30% by the end of 2030. And we think this is a sustainable goal to attain. Turning to a review of our top-level financial results, we signaled a few weeks ago during our year-end earnings call that 2024 sales expectations were lower than 2023. Today, we reported sales of $78 million, down 21.5% due to challenging 2023 comparisons and end-market headwinds that we will discuss more in a moment. When we look at sales sequentially compared to the fourth quarter of 2023, sales for the first quarter of 2024 increased by 5.9%. Gross margin for the 2024 first quarter was 17% compared to 17.8% in the prior year first quarter and up 220 basis points from 14.8% in the fourth quarter of 2023. Anticipating lower sales, the company reacted quickly and leaned on the operational improvements made over the past several years to offset lost fixed cost leverage. We also generated $8.8 million in adjusted EBITDA, or 11.2% of sales, and we reported positive free cash flows. In summary for 2023, We completed the second must-win battle initiative, and the results are improved operational efficiencies and a solid foundation for continuous improvement in all of our plants. That work allowed us to operate with much more stability, consistency, and translating to more stable margins and improved product line profitability. Our intense focus or must-win battle is on sales this year, and our business fundamentals remain strong We continue to work on landing and diversifying into new business and increasing our opportunity pipeline. With that, I'd like to turn it over to John to cover the financials in more detail.