AdvanSix Inc.

Good morning and welcome to the Advanced 6 Second Quarter 2020 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 touchtone phone. 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 Adam Kressel, Director of Investor Relations. Please go ahead.

Thank you, Brandon. Good morning, and welcome to Advance6's second quarter 2020 earnings conference call. With me here today are President and CEO Aaron Kane and Senior Vice President and CFO Michael Preston. This call and webcast, including any non-GAAP reconciliations, are available on our website at investors.advance6.com. Note that elements of this presentation contain forward-looking statements that are based on our best view of the world and of our business as we see it today. Those elements can change, and the actual results could differ materially from those projected, and we ask that you consider them in that light. We refer you to the forward-looking statements included in our press release and earnings presentation. In addition, we identify the principal risks and uncertainties that affect our performance in our SEC filings, including our annual report on Form 10-K as further updated in subsequent filings with the SEC. This morning, we'll review our financial results for the second quarter of 2020 and share our outlook for our key product lines and end markets. Finally, we'll leave time for your questions at the end. So with that, I'll turn the call over to AdvanSix's President and CEO, Erin Kane.

Thanks, Adam, and good morning, everyone. Thank you for joining us and for your continued interest in AdvanSix. First, I'd like to start off the call by once again offering our best wishes to all who have been affected by the COVID-19 pandemic. I hope that everyone listening today, as well as their families and coworkers, are healthy and staying safe. I would also like to acknowledge our 1,500 teammates at Advancics. We knew early on that the chemical industry and our business will be deemed essential, and our entire team has lived up to that calling. We continue to deliver for our customers by driving safe, stable, and sustainable operations. During the second quarter, we continued to execute our business continuity and mitigation plans with a focus on health and safety, including, among other actions, onsite medical personnel to actively monitor employees and contractors, thermal screening, social distancing measures, telecommuting, and upgraded personal protective equipment and face coverings at all facilities. We are very pleased with the results our practices and protocols are delivering. Mike will detail our second quarter financials in a moment where we believe our results reflect the resilience and strength of our business model, vertically integrated asset base, and global low cost advantage. Notably, we were able to improve earnings sequentially from the first quarter despite the impacts of COVID-19. In the face of a challenging end market environment, I'm also encouraged by the sequential improvement we saw month to month within the second quarter in terms of both industry demand as well as our own operating rates. For perspective, our hopeful utilization rates in April were roughly 70%, followed by nearly 85% in May and June, bringing us to roughly 80% capacity utilization for the quarter in total. Early here in the third quarter, we've seen further improvement and are nearly approaching our normalized target rates. Our diverse portfolio, including granular ammonium sulfate, sold into the heart of the domestic planting season, and acetone used for items such as hand sanitizer and acrylic screens, continue to support us as we navigated through weak nylon industry conditions. Looking forward to the second half, we are ramping up preparations for the start of our third quarter planned plant turnaround, which is primarily focused around our ammonia plant. We have taken a number of steps to ensure the health and safety of our employees and contractors, as well as our assets. From a product line perspective, while we expect a challenging nylon demand environment to continue, we've been actively working to optimize our mix across end uses, applications and geographies to position the business for success. In ammonium sulfate, following the strong domestic demand in the second quarter, we do expect typical seasonality to drive a normal sequential pricing and mix decline in the third quarter. And in chemical intermediates, we expect the favorable acetone industry supply and demand balance to continue, while also benefiting from ongoing investments in high purity applications and other differentiated products within this portfolio. We also remain confident in our financial position. As we anticipated at the end of the second quarter, we had approximately $109 million in available liquidity between cash on hand and additional capacity under a revolving credit facility. Overall, a very similar position to where we ended the first quarter, despite the challenging environment in which we're operating in. We do continue to expect positive free cash flow for the second half and full year, supported by targeted reduction of capital expenditures, anticipated working capital improvement, and receipt of cash tax benefits associated with the CARES Act. We're also taking a disciplined approach to cost management and have increased our expected cost reduction for the full year to a range of $15 to $20 million compared to 2019, in addition to the benefits associated with our natural gas boiler investment. So overall, we're driving productivity and cost savings to help mitigate the volume and price impacts of the dynamic market we are navigating. During this unique time, we're committed to driving best possible outcomes and optimizing levers in our control to create shareholder value. I continue to be inspired by the teamwork, innovation, and nimble decision-making that is happening across our organization. With that, I'll turn it over to Mike to discuss the details of the quarter.