Park-Ohio Holdings Corp.

Good morning. Welcome to the PARCC Ohio Second Quarter 2022 Results Conference Call. This time, all participants are in listen-only mode. After the presentation, the company will conduct a question and answer session. Today's conference is also being recorded. If you have any objections, you may disconnect at this time. Before we get started, I want to remind everyone that certain statements made on today's call may be forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those projected. A list of relevant risks and uncertainties may be found in the earnings press release as well as in the company's 2021 10-K, which was filed on March 16, 2022, with the SEC. Additionally, the company may discuss adjusted EPS and EBITDA as defined. Adjusted EPS and EBITDA as defined, are not measures of performance under generally accepted accounting principles. For reconciliation of EPS to adjusted EPS, and for reconciliation of net income attributable to Park Ohio common shareholders to EBITDA, as defined, please refer to the company's recent earnings release. I will now turn the conference over to Mr. Matthew Crawford, Chairman, President, and CEO. Please proceed, Mr. Crawford.

Good morning and thank you for joining our second quarter 2022 call today. As I mentioned in our press release last night, we're pleased with the revenue acceleration across the business. The broad nature of this growth and the contribution of new business, as well as the resurgence in markets that have been struggling until recently, most notably rail, aerospace, oil, and gas, which all showed improved results, bodes well for the balance of the year. Zooming out a bit, we see two additional positive signs on the horizon. First, we believe that most of our end markets will benefit from an improving supply chain environment over the next year or so as our customers seek to restock their inventories. We do not believe a deep recession is a base case for our end markets at this time. But regardless, any reduction in demand caused by the Fed tightening cycle should be offset by the restocking demand at some level. Secondly, we are watching with a close eye the federal government's legislation which targets businesses and infrastructure investments. While it's too early to foretell all the specifics, we may benefit in a variety of ways. A few include, first, increased investment in semiconductor production will benefit directly a number of our supply technology customers. Second, green energy and particularly electric cars, wind turbine energy, and the decarbonization of the industrial sector will also benefit most significantly our ACG and our engineer component segment. And three, broad investments in infrastructure related to rail, roads, bridges, and grid will touch a wide portion of our business. Despite this revenue momentum, earnings fall short of our consolidated expectations. Inflation, logistics, and labor challenges continue to be an everyday and continuing challenge for the business. Supply technologies whose active part numbers reach well over 100,000 SKUs has continued to leverage strong supplier relationships and a significant incremental investment, excuse me, a significant incremental inventory investment to battle these challenges and fulfill record customer demand. Our engineer products group has worked similarly hard to manage record backlogs and secure important materials to complete jobs. Assembly components has been the most affected due to unique challenges and volatility of the auto supply chain. We're addressing these challenges with significant restructuring, which will reflect a lower cost structure and increase pricing from our customers where inflation has impacted us most. Since many of these actions take three or four months to impact our profitability, we anticipate market improvement in the second half. Lastly, we're happy to have closed on two acquisitions recently. As most of you know, we have grown significantly over the years through deals and believe not only do these transactions fit the mold of our most successful, but also pay vigorous attention to where we see the most long-term opportunity for Park Ohio and will be accretive to our gross margin and our bottom line immediately. Thank you as well to all of our teammates.

These last couple years have been filled with challenges, and I appreciate the hard and smart work and the fruits of this effort. With that, I'll turn it over to Pat to cover the results.