Latham Group, Inc.

And welcome to the Latham Group Third Quarter 2024 Earnings Conference Call. All participants will be in 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 telephone keypad. To withdraw your question, please press star then two. Please note, this event is being recorded. I would now like to turn the conference over to Casey Coterie, Investor Relations Representative. Please go ahead.

Thank you. This afternoon, we issued our third quarter 2024 earnings press release, which is available on the Investor Relations portion of our website, where you can also find the slide presentation that accompanies our prepared remarks. On today's call are Latham's President and CEO, Scott Rogeski, and CFO, Oliver Glow. Following their remarks, we will open the call to questions. During this call, the company may make certain statements that constitute forward-looking statements which reflect the company's views with respect to future events and financial performance as of today or the date specified. Actual events and results may differ materially from those contemplated by such forward-looking statements due to risks and other factors that are set forth in the company's annual report on Form 10-K and subsequent reports filed or furnished with the SEC as well as today's earnings release. The company expressly disclaims any obligation to update any forward-looking statements, except as required by applicable law. In addition, during today's call, the company will discuss certain non-GAAP financial measures. Reconciliations of the directly comparable GAAP measures to these non-GAAP measures can be found in the slide presentation that accompanies our prepared remarks, which can be found on our Investor Relations website. I'll now turn the call over to Scott Rogeski.

Thanks, Casey, and thank you all for participating in today's call to discuss our third quarter results and review our business outlook. Our third quarter performance was mostly consistent with our expectations and, again, demonstrated both Latham's resilience and progress within a challenging industry environment. In terms of this quarter's key takeaways, first, market conditions through quarter end played out in line with our initial expectations for an approximate 15% decline in in new pool starts this year. Second, with this as a backdrop, we continue to drive awareness and adoption of fiberglass pools and automatic safety covers, two key growth areas for LAPHA. Third, our lean manufacturing and value engineering programs, together with improved procurement activities, resulted in meaningful cost reductions that led to stable gross profit and expanded gross margin in the third quarter on lower year-on-year sales. And lastly, We ended the third quarter in a strong financial position with cash for approximately $60 million after having dispersed approximately $65 million for the CoverStar Central acquisition and repaid approximately $20 million in debt in the first nine months of this year. Latham's growth strategies and leadership position in fiberglass pools are enabling us to outperform this industry downturn and are positioning us as a prime beneficiary of a market recovery. We have the broadest lineup of pool configurations, the widest range of price points, and the greatest array of specialty features, including spas and tanning ledges. Also, with 12 fiberglass manufacturing facilities globally, we are best positioned to serve the major U.S. markets and Canada. In the third quarter, Latham's fiberglass pool sales have continued to show relative strength. Their market differentiators are compelling, cost-efficient, fast and easy to install, and requiring fewer chemicals to maintain. And our commitment to innovation to address and anticipate consumer preferences is another element driving increased adoption of fiberglass pools. For example, we added to our plunge pool offering earlier this year with the launch of the Enchantment Series in several markets with a plan to expand to all of the U.S. in 2025. While plunge pools represent only a small percentage of our total in-ground pool sales, they are a growing category for us as they appeal to consumers looking for space-saving, affordable options for aquatic exercises, rehabilitation, and recreation. These attributes are particularly attractive in the sand states, where we are deploying more resources to gain share for fiberglass in the coming years. Based on our year-to-date results, we expect fiberglass pools to account for about 75% of our total in-ground pool sales in 2024, in line with our original projection. We also significantly strengthened our position in automatic safety covers in the third quarter, with the August 2nd acquisition of CoverStar Central. The key integration activities are complete and revenue synergy initiatives are underway. We are entering the 2025 season with an integrated marketing and sales strategy aimed at accelerating the growth of this standout product line. Latham's automatic safety covers provide unparalleled safety and other significant operating cost savings, including reductions in heating and electricity costs and in water and chemical usage for the homeowner. As a reminder, these covers can be fitted to all pool types, and we see opportunities to leverage CoverStar Central's long-standing relationships with pool builders and its markets to increase their awareness of the fiberless pool value proposition. As Oliver will detail in a moment, we were pleased to be able to maintain third-quarter gross profit levels that were stable with the comparable period last year and expand gross margin by 250 basis points despite lower sales. These results reflect the substantial benefits that Latham has gained from actions over the last two years to reduce costs and drive production efficiencies. Year-to-date, we are tracking nearly $8 million in savings from our lean manufacturing and value engineering initiatives, with the largest portion coming from our fiberglass plants. Additionally, our focus on safety has yielded a significant drop in incidents across all manufacturing locations. We believe that Latham's operational and financial model has structurally changed, which has increased our underlying earnings capabilities amid an industry recovery and will enable longer-term margin expansion. And we are increasing our investments in sales and marketing and product development initiatives to ensure that we capture an incremental share of in-ground pool sales once volumes rebound. The organic growth strategies we are executing are centered around driving adoption of fiberglass pools and automatic safety. Additionally, we are focused on continuing to gain share in the sand states where we are underrepresented. We are evolving our mix of pool styles to offer more rectangle and plunge pools and more pool-spa combos, a laser focus on master playing communities in our target markets where we have already seen strong lead generation and the continued conversion of top builders who recognize the benefits of the industry-leading lead times and ease of installation associated with Latham's fiberglass pools. We plan to execute on our goal of increasing the adoption of automatic safety covers in tandem with our plans for fiberglass pool market share gains, as well as through channeling the combined resources of Latham and CoverStar Central to effectively reach the builder and consumer markets. Importantly, all the capabilities to achieve our growth objectives are already resident at Latham. We now have an impressive team in place that is dedicated to driving our growth in the sand states, and we are confident in their abilities. Additionally, we have the financial flexibility to consider strategic acquisition opportunities like CoverStar Central that are accretive and provide us entry in the new markets, strengthen our position in existing geographies, or enable us to accelerate growth of existing product lines. Lastly, we are pleased to report that none of our employees in areas impacted by the recent hurricanes were physically hurt, and our Zephyr Hill plant did not suffer damage beyond several fallen trees. However, The plant was shut down for about a week due to power loss and limited site access, and customers in Florida, Georgia, and the Carolinas pushed out some orders. Given this, along with our visibility through year-end, now that much of the pool-building season is behind us, we have narrowed our guidance ranges for net sales and adjusted EBITDA. Now, I would like to turn over the call to our CFO, Oliver Glow, for a financial review. Oliver?