Flexsteel Industries, Inc.

Good morning and welcome to the Flex Steel Industries second quarter fiscal year 2023 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. To withdraw your question, please press store then two. Please note this event is being recorded. I would now like to turn the conference over to Alejandro Huerta, Chief Financial Officer for Flex Steel Industries. Please go ahead.

Thank you and welcome to today's call to discuss Flex Steel Industries second quarter fiscal year 2023 financial results. Our earnings release which we issued after market closed yesterday, Monday, February 6th is available on the investor relations section of our website at www.flexsteel.com under news and events. I am here today with Jerry Dittmer, president and chief executive officer and Derek Schmidt, chief operating officer. On today's call, We will provide prepared remarks, and then we will open the call to your questions. Before we begin, I would like to remind you that the comments on today's call will include forward-looking statements, which can be identified using words such as estimate, anticipate, expect, and similar phrases. Forward-looking statements by their nature involve estimates, projections, goals, forecasts, and assumptions, and are subject to risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. Such risks and uncertainties include but are not limited to those that are described in our most recent annual report on Form 10-K, as updated by our subsequent quarterly reports on Form 10Q and other SEC filings as applicable. These forward-looking statements speak only as of the date of this conference call and should not be relied upon as predictions of future events. Additionally, we may refer to non-GAAP measures, which are intended to supplement but not substitute for the most directly comparable gap measures. The press release available on the website contains the financial and other quantitative information to be discussed today, as well as the reconciliation of the gap to non-gap measures. And with that, I will turn the call over to Jerry Dittmer. Jerry?

Good morning, and thank you for joining us today. In spite of challenging macroeconomic environment, I am pleased with our performance in the second quarter. I am encouraged by the progress we have made on our strategic initiatives and ability to gain share in the market, allowing us to deliver sales for the quarter of $93.1 million, which was in the range of our guidance as our growth initiatives helped to partially offset the challenges posed by high retail inventories and waning consumer demand. With these softer demand levels, we've continued to prudently manage spending, deliver on our cost-saving initiative, and offset competitive pricing pressures and inflationary costs to deliver adjusted operating income of $1.0 million. As discussed in previous quarters, we are committed to driving working capital efficiency and paying down debt. further strengthening our balance sheet. During the second quarter, we were successful in making strides in both as we improved working capital by $9 million and reduced our outstanding debt by $10.9 million. In the near term, macroeconomic headwinds pose a challenge to industry growth. However, our commitment remains on delivering long-term profitable growth and we are making pragmatic investments to support these plans. We recently announced a realignment in our organizational structure, reallocating more dedicated resources to new growth pursuits, expanding our sales force, adding sales leadership to gain market share, and investing in resources to support the expansion of product management, development, and engineering. As an organization, we are focused on navigating the challenges in the current environment while positioning ourselves to deliver on our long-term strategic initiatives. I'll now turn the call over to Derek to discuss our strategic initiatives and operational priorities before Alejandro takes you through further details of our financial results. I'll be back at the end of the call with some closing comments on what we see ahead.