DMC Global Inc.

Good afternoon, ladies and gentlemen, and welcome to the DMC Global Third Quarter Earnings Call. At this time, all participants have been placed on a listen-only mode, and we will open the floor for your questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Jeff High, Vice President of Investor Relations. Sir, the floor is yours.

Hello, and welcome to DMC's Third Quarter Conference Call. Presenting today, our President and CEO, Kevin Long, and CFO, Mike Kuda. I'd like to remind everyone that matters discussed during this call may include forward-looking statements that are based on our estimates, projections, and assumptions as of today's date and are subject to risks and uncertainties that are disclosed in our filings with the SEC. Our business is subject to certain risks that could cause actual results to differ materially from those anticipated in our forward-looking statements. DMC assumes no obligation to update forward-looking statements that become untrue because of subsequent events. A webcast replay of today's call will be available at dmcglobal.com after the call. In addition, a telephone replay will be available approximately two hours after the call. Details for listening to the replay are available in today's news release. And with that, I'll turn the call over to Kevin Long. Kevin?

Good afternoon, and thank you for joining us for a review of DMC's third quarter financial results. Our third quarter sales and profitability were above our guidance. reflecting continued strong demand within the end market served by our three asset-light manufacturing businesses. Consolidated third quarter sales were a record $174.5 million, which were up 5% from the second quarter and up 160% from the third quarter last year. Excluding $80.7 million in revenues from Arcadia, in which we acquired a 60% controlling interest last December, third quarter sales increased 5% sequentially and 40% versus the third quarter of 2021. The growth reflects stronger sales at DynEnergetics, our energy products business, which is benefiting from healthy activity in the global wealth completion industry. DynEnergetics third quarter sales were $70.4 million, up 4% sequentially and up 59% versus last year's third quarter. The safety, performance, and efficiency of Dyna Energetics' fully integrated DS perforating systems continues to drive increased adoption by North America's exploration and production companies and service providers. This year Dynaergetics has already surpassed the 1 million unit mark for shipments of its factory assembled performance assured DS perforating systems. It is the first time a million units have been shipped in a single year since the product was launched in 2015. The on-time delivery rate of these systems is 99.93% and they were deployed by our customers at a success rate of 99.98%, which we are very proud of. The systems also were deployed without a single safety incident in the seven-year commercial history of the DS system. We have shipped nearly 4 million units without a reported safety issue. Arcadia, our architectural building products business, reported third quarter sales of $80.7 million, up 6% sequentially, and up 24% versus pro forma sales in last year's third quarter. The improvement reflects higher selling prices, which were implemented to offset a sharp increase in aluminum costs earlier in the year. Aluminum prices actually rose faster than Arcadia increased prices for its products. Additionally, Third quarter orders that shipped out of backlog were quoted before the price increases took effect. Combined, these factors reduced Arcadia's gross margin to 30% from 34% in the second quarter and 36% in last year's third quarter. We expect it will take another quarter for the balance of the high-priced aluminum inventory to move through Arcadia's service centers, at which time we expect Gross margins will return to normalized levels in the low to mid-30% range. Demand for commercial products in Arcadia's western and southwestern U.S. territories remains healthy, and Arcadia's commercial team is working on booking a diverse collection of projects that include hotels, educational facilities, and casinos. Arcadia is also investing in resources to support future growth. We've been working on the implementation of a new enterprise resource planning system since the beginning of the year. In addition, Arcadia has hired sales and manufacturing personnel at its new service centers in Dallas and Houston, two large markets that we believe will fuel strong long-term growth. Arcadia Custom, which serves the high-end residential market, also is reporting strong demand and is working through a large-order backlog. It is adding production capacity at its Tucson, Arizona facility and investing in sales and marketing resources that will create demand for its differentiated product offering. Third quarter sales at Nobleclad, our composite metals business, were $23.4 million, up 7 percent sequentially and up 2 percent versus last year's third quarter. Novoclad's rolling 12-month bookings increased to $97.7 million, up from $92.5 million at the end of the second quarter. Order backlog increased to $48 million from $46.8 million in the prior quarter. The outlook at Novoclad continues to improve, and we are beginning to see several of the large industrial projects Novoclad has been pursuing moved to the award phase. We made significant progress during the third quarter, and I'd like to thank DMC's employees for their continued hard work and commitments to the company. DMC is well positioned to deliver long-term growth, improved returns for our shareholders, and opportunities for our employees. Now I'll turn the car over to the call over to Mike for a review of our third quarter financial results and a look at fourth quarter guidance. Mike?