TriMas Corporation

and welcome to TriMAS first quarter 2024 earnings conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Ms. Sherry Lauterbach. VP Investor Relations and Communications. Thank you, Ms. Lauterbach. You may begin.

Thank you, and welcome to Trimath Corporation's first quarter earnings call. Participating on the call today are Thomas Amato, Trimath's President and CEO, and Scott Mell, our Chief Financial Officer. We will provide a prepared remark on our first quarter results, and then we will open up the call for your questions. In order to assist with the review of our results, we have included today's press release and presentation on our company website at Trimouse.com under the Investors section. In addition, a replay of this call will be available later today by calling 877-660-6853 with a meeting ID of 1374-5821. Before we get started, I would like to remind everyone that our comments today may contain forward-looking statements that are inherently subject to a number of risks and uncertainties. Please refer to our Form 10-K and our first quarter Form 10-Q to be filed later today for a list of factors that could cause our results to differ from those anticipated in any forward-looking statement. Also, we undertake no obligation to publicly update or revise any forward-looking statement except as required by law. We would also direct your attention to our website where considerably more information may be found. In addition, we would like to refer you to the appendix in our press release or our presentation for the reconciliations between GAAP and non-GAAP financial measures used during this call. Today, the discussion on the call regarding our financial results will be on an adjusted basis, excluding the impact of special items. With that, I'll turn the call over to Tom Amato, Trimouse's President and CEO. Tom?

Thank you, Sherry. Good morning and welcome to our first quarter earnings call. Let's turn to slide three. First, let me say that we're off to a great start. The positive momentum we began to observe at the end of 2023 in certain of our end markets and performance in TriMass' two largest segments has continued as we begin the year. Within our TriMass packaging group, Virtually all of the end markets that were depressed in a cyclical demand trough in 2023 are now up organically and displaying signs of strengthening. Additionally, on a year-to-date basis, only products used in certain beverage applications softened as compared to the prior year quarter, driven primarily by lower sales into certain dairy applications and delays in orders related to European-based customers converting to tethered caps. For our TriMAS Packaging Group overall, organic sales were up 6.1%, with total sales for the group up 9.3%. Sales and order intake within TriMAS Packaging are important foundational indicators reinforcing our confidence that we are executing the right strategies to deliver our 2024 financial targets. Within our TriMAS Aerospace Group, Organic sales were up 11.8%, with total sales up 34.7%, driven by higher aerospace fastener throughput and our acquisition of well-backed manufacturing. Our backlog and order intake within TriMAS Aerospace remains robust, which we believe supports our continued recovery efforts given the dislocation in market demand and sub-supply and labor availability for which we had been working on through most of the prior year. While our packaging and aerospace segments represent over 80% of our sales in the quarter, sales in our specialty product segment weakened significantly in the first quarter as compared to an exceptional sales rate in the first quarter of last year. Two main factors drove this rate of change, which Scott will cover in more detail later. First, while lower cylinder sales were anticipated, the rate of change was higher than planned due to overstocking of cylinders in 2023 as customers sought to mitigate logistics and lead time challenges from prior years. Additionally, we had no meaningful sales of compressors to one of our customers in the oil and gas market. Our specialty products businesses continue to flex costs and right size where practical to current demand levels while also preserving the ability to meet anticipated higher demand in the second half of 2024. We have experienced demand volatility within our specialty products businesses in the past, and we remain confident that volumes will begin to recover as we move through the year. On a consolidated basis, TriMass sales for the first quarter were up 5.4%, slightly ahead of expectations. I would also like to turn our attention to share repurchases to start the year. We repurchased approximately 540,000 shares for a net reduction of shares outstanding of approximately 1%. And as of today's call, we have increased this total to just over 600,000 shares on a year-to-date basis, further adding to our return of capital metrics. This rate of share repurchase is higher than the first quarter of last year as reducing shares outstanding is a tax-efficient way to provide long-term value to our shareholders, particularly when we believe there are valuation dislocating events in the market. Finally, as noted in today's press release, we achieved adjusted earnings per share of $0.37, an increase of 5.7% as compared to the prior year quarter. In light of a solid start to the year, trends we are seeing in certain of our end markets, and even when considering, in some cases, continued demand volatility, we are reaffirming our sales and adjusted EPS guidance for the year. Let's turn to slide four, and I will briefly go through our first quarter results in more detail. We are reporting sales of 227 million, up 5.4% as compared to the prior year quarter, due to the factors previously discussed. Adjusted operating profit was 16.2 million, and was up by 4.7% as compared to the prior year quarter last year. This performance was driven by improved conversion rates within TriMass Aerospace and the beginning of operating leverage gains in TriMass Packaging, more than offsetting lower earnings in specialty products and the treatment of non-cash stock compensation, which slightly burdened the quarter. As previously noted, adjusted EPS was 37 cents as compared to the prior year quarter of 35 cents. And finally, adjusted EBITDA for the quarter was $35 million, up by 10.2% as compared to the prior year quarter. We are continuing to make gains in our LTM EBITDA, which is now at approximately $160 million, as compared to the last quarter of $156.4 million. This is an important performance trend we like to see as it demonstrates momentum in recovering end markets. In turning to slide five, we continue to manage a strong balance sheet. And as a reminder, the vast majority of our debt is at a low interest rate and not terming out until 2029. We finished the quarter with net debt of $394.5 million and a leverage ratio of 2.5 times. We did spend just over $13 million in the quarter on share repurchases, which, as discussed, we believe was an appropriate tradeoff given dislocation in our share price. Additionally, we did have a use of cash in the quarter driven by seasonal timing, higher sales activity, and strategic inventory builds. While not the same rate as last year, this use of cash rate is historically the norm for TriMAS as we move from Q4 to Q1. At this point, I will now turn the call over to Scott, who will take us through TriMAS' segment results. Scott?