Advantage Solutions Inc.

Greetings and welcome to the Advantage Solutions third quarter 2024 earnings call. At this time, all participants are in a listen-only mode. After the speaker's remarks, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. If anyone should require operator assistance during the conference, please press star zero. As a reminder, this conference is being recorded. It is now my pleasure to introduce Ruben Meya, Vice President of Investor Relations. Thank you, Ruben. You may begin.

Thank you, operator. Welcome to Advantage Solutions' third quarter earnings conference call. Dave Peacock, Chief Executive Officer, Chris Grohe, Chief Financial Officer, and Sean Chosky, Senior Vice President of Strategy and M&A, are on the call today. Dave and Chris will provide their prepared remarks, after which we will open the call for a question and answer session. During this call, management may make forward-looking statements within the meaning of the federal securities laws. These statements are based on management's current expectations and involve assumptions, risks, and uncertainties that are difficult to predict. It is important to note that actual outcomes and results could differ materially due to several factors, including those described more fully in the company's annual report on Form 10-K filed with the SEC. All forward-looking statements are expressly qualified in their entirety by such factors. The company does not undertake any duty to update or revise any forward-looking statements except as required by law. We want to draw your attention to the fact that our remarks today will focus on certain non-GAAP financial measures. Our earnings release issued earlier today provides a reconciliation of these non-GAAP financial measures to the most comparable GAAP measure. This call is being webcast and a recording will also be available on the company's investor relations website. During the prepared remarks, we will refer to a presentation which can be found in the events and presentation section of the IR website. As a reminder, unless otherwise stated, the financial results discussed today will be from continuing operations. And now I would like to turn the call over to Dave Peacock.

Thanks, Ruben, and good morning, everyone, and thank you for joining us. Our discussion this morning will center on the third quarter results and outlook for the year, how we are expanding our relationships with clients and the progress we are making on our transformation journey. We are pleased with our results in the third quarter. On an organic year-over-year basis, excluding the deconsolidation of the European JV and pass-through costs, revenues increased approximately 2% to $802 million, and adjusted EBITDA increased 8% to $101 million. We remain committed to delivering our guidance for the year. Experiential services and retailer services delivered healthy performance, resulting in revenue and adjusted EBITDA growth. A timing benefit from the fourth quarter partly drove their results. In branded services, we continue to navigate the impacts of a challenging consumer environment for our clients while managing costs and leveraging new tools and technology to enhance our sales and merchandising effectiveness. Advantage is positioned squarely at the intersection of brands and retail with a diverse mix of capabilities, unique insights, and connectivity to help our clients increase profitable sales regardless of market conditions. Our scale in managing over 70,000 dedicated teammates who serve more than 100,000 retail locations nationwide creates a network effect for greater speed, agility, and precision to the critical services that fuel growth for brands and retailers. Through our transformation initiatives, we are further differentiating our client solutions through technology and analytics while enhancing cost effectiveness regardless of economic circumstances. We are confident this will increase the resilience of our operating performance and drive better outcomes for our 4,000 strong client base. The largest of them have been with us on average for more than 15 years and have a 95% retention rate over time. During the quarter, we continued to grow our client roster and expand advantages service offerings with existing clients. We did this across both core and adjacent services while also expanding into new market categories and channels. Starting with retailer services, we aim to better utilize our labor to improve profit growth and margins with our full suite of services with existing clients and adding new clients by expanding into adjacent market segments with our core offerings. During the quarter, we expanded our services with a national grocery chain where we have been providing merchandising services by adding store remodels and adjacent offering through our trade services team. Trade Services represents an expansion of our core capabilities, providing in-store construction and build-out to bring physical shopping experience to life. In the last seven months, we built the interior store fixtures at 65 new locations, including the grocer's first small format store, which opened this year in New York City. The team also helped to expand the grocer's North American footprint by building its first physical store in Canada. We are also expanding our private brand services beyond the grocery market, where we enjoy a very high relative market share, into faster-growing channels like value, C-stores, and mass to enhance growth. We recently signed an agreement with a national chain of convenience stores. Our services will include optimizing what they stock, reducing their operational costs, and developing a best-in-class private brand program. We're confident in our ability to deliver on this initial scope of work, which will set the stage to further develop our relationship moving forward. Turning to experiential services, our goal is to continue to enhance our execution against growing demand for in-store events, which helps cover fixed costs and drive efficiencies. We are also growing our low-labor direct-to-home sampling, which comes with a high margin and an attractive market as consumers continue to utilize online solutions for shopping. These efforts enable sampling for online shopping and drive traffic to brick and mortar stores. We recently signed an agreement with a major department store to support their fragrance team for the upcoming holiday season. Furthermore, we are collaborating with them on a creative and production strategy for a fragrance kit launched in the spring. Lastly, one of our goals in branded services is to accelerate cross-selling with existing clients to solve their challenges. We expanded our relationship with a startup energy beverage company in the better for you category by adding several services, including headquarters sales and the convenience channel e-commerce in order to cash. Another opportunity was with a beauty company where we expanded our services from supporting their Amazon business to collaborating with them on headquarters sales in Canada. It's early days, but we are discovering more and more opportunities to cross-sell our capabilities within branded services and in the marketing and selling of our interconnected capabilities across all three business segments. Turning to an update on our transformation. We have taken significant actions to simplify the business, streamline processes, and improve financial discipline. Our progress is rooted in focusing on where we have a right to win. This includes strengthening our core competitive advantages in areas like headquarters selling, retail merchandising, sampling, and other areas of support that we provide to our clients and customers. We are modernizing technology and forming strategic collaborations to enhance scale and productivity. This allows us to serve our clients while being nimble in addressing a changing market. We are clarifying and simplifying our offerings and further unifying our marketing approach to support lead generation cross-selling, and up-selling. Core to our transformation is improving operating efficiency. We are making progress on company-wide IT initiatives such as ERP replacement, modernizing cybersecurity, migration to the cloud, and investing in a data lake for enhanced analytics and a full utilization of AI where applicable to support our strategy. To date, we have upgraded several IT systems through Tata consultancy services to support the tools our frontline teammates use to serve clients, ultimately saving time and costs. We are partnering with IBM to outsource procurement in the areas with the biggest savings opportunities, leveraging their expertise while maintaining vendor quality. We are collaborating with established and emerging technology companies to equip our branded and retailer services teams with modern tools like image recognition, shelf-level intelligence, and proprietary planogram technology. These efforts not only drive efficiencies, but also free up time to help brands and retailers capitalize on growth opportunities. Our market position and tech tools give us a unique vantage point on the industry. We have access to performance insights at multiple levels down to the retailer, location, aisle, and shelf. Our teams visualize data-driven strategies with tools like Power BI to share a comprehensive view of the market, including distribution, pricing, and the impact of promotions. With our reach and relationships, we can translate those real-time insights into action faster and at scale in ways competitive models cannot. We are actively prioritizing AI use cases in contract management, routing merchandisers, HR workflow, sales tools, and analysis of large datasets. We are also exploring potential partnerships and third-party vendors to provide AI platforms and applications at a larger scale and a faster rate of adoption. Another area of focus for our transformation is the digital shopping experience. We are elevating our omnichannel capabilities across all three segments to offer retailers scalable and targeted omnichannel solutions that connect the dots for clients and create value at scale. We are partnering with technology firms that are leaders in providing CPGs and retailers with the tools to reach those consumers. This is a great opportunity for us to bridge online activity to drive traffic in the stores with a workforce that can execute on the ground at scale, like physically placing promos and signage to help brands break through and drive conversion at the shelf where the consumer decision is made at the point of sale. To conclude, we are working closely with our clients to meet their needs as they address meaningful changes in consumer behavior. We are doing this by focusing on where we provide the most differentiated capabilities and where we can drive consistent results through improved processes and technologies enabled by our transformation. We remain on track to deliver against our previously stated guidance for the year, which is a testament to our teammates' hard work. With that, I will now pass the call over to Chris for his insights into our financial performance. Thank you, Dave, and welcome to all of you joining the call today.