Apogee Enterprises, Inc.

Good day, and thank you for standing by. Welcome to the Apogee Enterprises Fiscal 2023 Third Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star 1 and 1 on your telephone. You will then hear an automated message advising that your hand is raised. Please be advised that today's conference is being recorded. I would now like to hand the conference over to our speaker today, Jeff Hibshon. Please go ahead.

Thank you. Good morning, everyone, and welcome to Apogee Enterprises Fiscal 2023 Third Quarter Earnings Call. With me today are Ty Silberhorn, Apogee's Chief Executive Officer, and Mark Ogdahl, Interim Chief Financial Officer. I'd like to remind everyone that there are slides to accompany today's remarks. These are available in the Investor Relations section of Apogee's website. During this call, we will reference certain non-GAAP financial measures. Descriptions of these measures and a reconciliation to the nearest GAAP measures are provided in the earnings release and slide deck we issued this morning. As a reminder, the prior year results for the architectural framing systems and services segments have been recast to reflect the move of the SOTOWALL business from framing into services. Pro forma segment results reflecting this change are included in our earnings slide deck. I'd also like to remind everyone that our calls contain forward-looking statements. These reflect management's expectations based on currently available information. Actual results may differ materially. More information about factors that could affect Apogee's business and financial results can be found in today's press release and RCC filings. And with that, I'll turn the call over to you, Ty.

Thanks, Jeff. Good morning, everyone joining us online. This is another great quarter for Apogee with double-digit revenue growth, significant margin expansion, and strong cash flow. I'm very proud of the team's execution this quarter and the progress that they've delivered this fiscal year. This morning, I'll discuss highlights from the quarter and how our strategy is driving sustainable improvements in our business, and the opportunities we see for further gains. Then I'll turn it over to Mark for more details on the quarter and our outlook before we take your questions. Let's start with our third quarter highlights, which are on page four in our presentation. Revenue was up 10% this quarter. This was led by Framing Systems, which has posted double-digit growth each quarter this fiscal year. It was also encouraging to see solid revenue growth in the glass segment. As a reminder, it's been over a year since we announced the closure of our state's borough and velocity locations, and we're starting to see the early benefits from our mix shift to more premium products in glass. Overall, operating margin came in at 9.4 percent this was up more than 300 basis points compared to adjusted operating margin in last year's third quarter in the years since our investor day we've made tremendous progress toward our goal of delivering annual operating margins greater than 10 percent like the past few quarters margin gains were driven by effectively managing the balance of pricing relative to higher operating costs, improved operational execution and productivity gains, and sustained savings from last year's restructuring actions. With the strong top-line growth and margin expansion, adjusted earnings per share were up 70%, coming in at $1.07. This was another record for adjusted EPS, beating the previous record that we set last quarter. We were also pleased with our cash flow, as we generated 54 million cash from operations. This was a strong result, following the softer-than-normal cash flow in the first half of the fiscal year. We still have work ahead of us to improve our working capital, but the third quarter was very encouraging. and we expect further progress in Q4. These strong results continue the trends from the first half of the fiscal year. Through executing our strategy, we have made sustainable improvements in our business. As a reminder, an overview of our three pillar strategy is shown on page five of our presentation. We began implementing this strategy in the late summer of 2021. Since then, our team has made tremendous progress. Across the company, we're building a results-driven culture focused on improving operational execution and providing exceptional value for our customers. We've made fundamental improvements to our cost structure, especially in framing systems and glass. We have established renewed energy around productivity through our lean initiatives. We strengthened our focus on differentiated products and services, and we've improved our approach to managing the balance between our costs and pricing while staying competitive in the marketplace. Most importantly, we are building the capabilities to enable sustained profitable growth in the years ahead. These initiatives include revitalizing our talent development programs, driving process standardization across the enterprise, and strengthening our M&A capabilities. Through all these efforts, we are transforming Apigee into a higher performing, more resilient company. Since launching our new strategy last year, we've raised the bar on margins and earnings, establishing a new baseline of performance as shown on page six of the presentation. With this stronger foundation, we're excited about Apigee's future. We've already made significant progress toward the financial goals we set during our investor day last year, and I'm confident that we will drive further advancement in the quarters ahead. We are still in the early stages of our journey with lean and the development of the Apigee management system. And these efforts have the potential to still drive meaningful productivity gains for the next few years. We are also early in our efforts to shift our sales mix. We are pivoting toward more differentiated products and services that support our goal of becoming an economic leader. Over time, this shift should lead to a more resilient business model with sustainable opportunities for profitable growth. We are also pursuing several other important opportunities to drive organic growth. These include investments to scale and grow the services segment, capacity investments to enable growth in large-scale optical, and geographic expansion in both framing systems and architectural services. Finally, our strong balance sheet and cash Cash flow provides the flexibility for value creating capital deployment. We are stepping up investments in higher return capital projects. We're building a pipeline of M&A candidates along with the processes and team that we will need to evaluate and integrate any potential acquisitions. We will also continue to return capital to shareholders through a growing dividend and opportunistic share repurchases. And we're committed to maintaining a strong financial position. We have great momentum as we wrap up fiscal 23 and look ahead to the next fiscal year, even if markets should soften. And I'm more confident than ever in our team and the direction of our strategy. With that, let me turn the call over to Mark for more details on the quarter and our guidance.