UFP Industries, Inc.

Good day and welcome to the UFP Industries second quarter 2026 earnings conference call and webcast. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Mr. Stanley Elliott, Director of Investor Relations. Please go ahead.

Good morning, everyone. Thank you for joining us to discuss UFP Industries' second quarter 2026 results. Joining me on our call today are Will Schwartz, our President and Chief Executive Officer, and Mike Cole, our Chief Financial Officer. Following our prepared remarks, we will open the call for questions. Before I turn the call over, let me remind you that yesterday's press release and presentation include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties that could cause actual results to differ materially from expectations. These risks and uncertainties include, but are not limited to, the factors identified in the release, in our most recent annual report on Form 10-K, and in our other filings with the Securities and Exchange Commission. Today's presentation will also include certain non-GAAP measures. For reconciliation of these non-GAAP measures to the corresponding GAAP measures, please refer to our earnings press release and our website, UFPI.com. I will now turn the call over to Will.

Good morning, everyone. Thank you for joining today's call to discuss our financial results for the second quarter of 2026. On recent calls, we've discussed signs of stabilization across much of our portfolio. That trend continued in the second quarter and is best demonstrated in our net sales increasing 2.6% from a year ago results driven by a 1% increase in organic volume and a 2% contribution from recently completed acquisitions. Mike will provide the detailed financial bridge in a moment. Our positive organic growth at the consolidated level is an important milestone, particularly in a market environment that remains challenging and difficult to forecast. To put this in perspective, this is our first quarter of positive year-over-year organic growth since the third quarter of 2022. This performance is especially encouraging because it comes at a time when many of our end markets remain flat at best and continue to feel pressured. It reflects the strength of our pipeline of innovative products The benefits of our diversified portfolio and the disciplined execution of our teams across the company. USP has always been committed to disciplined growth. Since becoming CEO, one of my priorities has been to ensure we continue to outgrow our respective end markets while repositioning the business towards our long-term margin and return objectives. We remain committed to these targets and are focused on achieving them by focusing on these priorities. Investing in our highest margin core businesses, including disciplined strategic M&A, building brand awareness, introducing new and innovative products while enhancing our value-added product mix, and driving operational excellence across the enterprise. I am pleased with the progress we've made against these priorities during the quarter, and I'd like to highlight a few of them now. We invested $122 million to acquire MoistureShield, Berry Pallets, and John Rock. We discussed MoistureShield and Berry Pallets on our last call, and we are equally pleased to add John Rock to our industry-leading Pallet 1 operations. Strategically, these acquisitions fill important geographic gaps, enhance our service capabilities, and add needed capacity to support our long-term growth plans. Our M&A team remains very active and our pipeline continues to be robust. We remain in an enviable position with ample financial flexibility given our conservative capital structure. We are pleased with the success of our recent new product introductions. We continue to believe that innovation will be a growth engine for the company and saw meaningful growth sequentially and from year-ago levels driven by contributions across all three of our segments and we will continue to focus on innovation. We also continue to execute our cost management strategies and drive productivity improvements across the enterprise. At the same time, we are right-sizing and optimizing capacity while investing in automation, technology and machine learning to improve operations in real time and create greater value over time. A new and immediate area of focus for our team is managing transportation costs. While we have been largely able to offset high diesel costs through fuel surcharges and selective pricing, tighter market capacity resulting from regulatory changes and stronger enforcement rapidly drove a sharp increase in transportation costs, with rates during the quarter increasing approximately 30%, excluding fuel. To put the magnitude of this increase in perspective, the increase in spot rates in the quarter was more rapid and severe and more recently, these rates have stabilized but at elevated levels that we expect to persist for the foreseeable future. In response, we are adjusting our pricing where appropriate and continuing to pursue operational efficiencies to mitigate the impact. Now turning to our segments. In our retail segment, pro wood sales rebounded as we expected and came in well ahead of the overall repair and remodel market as we lapped storm-related demand and intentionally exited certain lower-margin commodity sales. Decorators continues to perform well, supported by strong customer demand for our branded decking products and recent investments in capacity. In April, we began shipping SureStone decking products from our new Greenfield location in Buffalo, and we are seeing throughput improvement at our Selma plant. Both contributed to sales growth in the quarter. Demand for our decking products continues to exceed our current production capacity. We end the quarter with a $30 million backlog, which we expect to reduce through the year as plant capacity optimization efforts are completed. We remain encouraged by demand from both customers and consumers. Our $30 million advertising program continues to increase customer awareness and consideration. Sample orders, website traffic, and other metrics have more than doubled since the start of the program. Importantly, we believe we remain on track to deliver 100 million of decking sales growth in 2026, excluding the moisture shield acquisition announced earlier this year. The integration of the former moisture shield facility into decorators is progressing well, with several key operational and training milestones completed. As discussed in prior quarters, TrueFrame, our new joist product offered by ProWood, remains another attractive growth opportunity. Customer response has been strong, reflecting the value and time savings we provide to contractors. These results are supported by continued enhancements to the ProWoodDealer online platform, which makes browsing, ordering, and tracking a more seamless experience. Finally, customer feedback on ARIS, our new trim product featuring SureStone technology, has been very positive and was launched in mid-July. Our packaging segment continues to outperform markets despite macro uncertainties, higher input costs, and freight pressure. We are gaining traction and winning with scalable strategic customers across the industrial economy. Our national footprint, leading design and engineering capabilities, along with our strategy to grow alongside key national customers, is showing up in structural packaging's results. We continue to see strong quoting activity and are encouraged by recent contract wins. Much like prior quarters, the market and pricing environment remain competitive for our pallet business, but even here we are seeing pockets of stabilization. In our protective packaging business, the two recent greenfield operations in Indiana and Nevada are increasing production levels, positioning us for market share gains and improved profitability in 2027. Closing with our construction segment, The macro environment in our construction segment has remained consistent for the past several quarters. New residential construction remains soft and accounted for all of the profit pressure in the quarter. At the same time, we believe that each quarter we are moving closer to finding a bottom in the business as year-over-year comparisons become easier in the back half of the year and the increase in our year-over-year backlog provides some cautious optimism. We are continuing to invest in automation, and other initiatives to improve our cost position and throughput. One example of these initiatives is the Frame Forward System solution selling approach in our site-built business and launched in February at the International Builders Show. It allows us to go to market with a systems-based offering that helps our customers save both time and money on the job site. We are seeing steady growth in new product sales, particularly in our light gauge metal offerings. Similarly, in our factory-built business, we are gaining traction with our strategy to deliver more value-added content. Across both site-built and factory-built, we are raising the bar for offsite manufacturing and helping customers address labor and efficiency challenges on the jobsite. We also believe provisions in the recently passed 21st Century Road to Housing Act and broader efforts to improve housing lines up well with our strategy, though it will take time for any benefits to show up in our results. Our concrete forming business continues to expand its product and service offering to meet customer needs wherever concrete is poured. Our goal is to capture more of our customer spending by offering solutions that help them address labor challenges on the job site. And finally, our commercial business continues to deliver strong results as we gain market share, expand the end markets we serve, and benefit from prior restructuring actions that improve productivity. Overall, I am pleased with how our balanced portfolio has performed in a difficult environment. While conditions remain dynamic, we are well positioned to create shareholder value as demand normalizes. And even with the headwinds we have faced, our margins remain 100 basis points higher than in 2019. As we move through the final six months of the year, we continue to remain focused on operational efficiency, discipline growth, and targeting higher returns on invested capital as we continue to focus on our key priorities that will help us make progress towards our long-term goals. The last 12 months have brought their share of surprises, and I'm proud of the team for responding with resilience, discipline, and continuing to focus on what we can control. While the environment remains challenging, I believe the bright spots I have highlighted today are the direct result of executing against our discipline strategy and I want to sincerely thank our talented UFP teams for their hard work and commitment. I will now turn over the call to our Chief Financial Officer, Mike Cole, and then I look forward to answering your questions.