Atmus Filtration Technologies Inc.

the question and answer session. If you would like to ask a question during that time, please press star followed by the number one on your telephone keypad. And if you would like to withdraw your question, again, press star one. Thank you. I would now like to turn the conference over to Todd Trulio, head of investor relations. Todd, you may begin.

Thank you, Krista. Good morning, everyone, and welcome to the Atmos Filtration Technologies third quarter 2023 earnings call. On the call today, we have Steph Disher, Chief Executive Officer, and Jack Insler, Chief Financial Officer. Certain information presented today will be forward-looking and involve risks and uncertainties that could materially affect expected results. Please refer to our slides on our website for the disclosure of the risks that could affect our results and for reconciliation of any non-GAAP measures referred to on our call. For additional information, please see our SEC filings and the investor relation pages available on our website at atmos.com. Now, I'll turn the call over to Steph.

Thank you, Todd, and good morning. It's great to be here with you today to provide an update on our third quarter financial results and business highlights for Atmos. The Atmos team achieved another quarter of superior performance, by focusing on our customers and delivering technology-leading FleetGuard products. I am pleased with the progress we have made to establish Atmos as an independent company. We are a purpose-driven company and our culture is shaped by our shared values. We have a clear strategy which is beginning to deliver results. Let me now turn to an overview of our performance in the quarter. First, I will review our global market and provide you with a summary of our solid third quarter. We continue to see strong demand in our first-bit markets in the third quarter, and we expect this strength to continue through the end of the year. In the aftermarket, as expected, we continue to see softening conditions driven by lower freight activity and continued destocking by customers. Most of our customers have now worked through destocking, and we expect this impact to now moderate through the end of the year. In the China market, there continues to be a sluggish economic recovery from last year, which is likely to persist through the remainder of the year. Now let's review our third quarter results. Sales in the third quarter 2023 were $396 million. a decrease of approximately 1% from the third quarter of 2022. Lower volumes were partially offset by higher pricing and FX tailwinds. Adjusted EBITDA margin rose 40 basis points from the prior year to 18.3%. We were able to grow margin on slightly lower sales as pricing actions along with improved commodity and freight costs drove margin growth. EBITDA has been adjusted for one-time separation costs, which were $7 million in the third quarter of 2023, compared to $2 million a year ago. Adjusted earnings per share was $0.52, and adjusted free cash flow was $50 million. We have adjusted free cash flow for $2 million of one-time capital expenditures related to separation. Our performance in the third quarter has enabled us to fully repay our revolving credit facility during the quarter. Additionally, we are also raising our full year 2023 guidance. Jack will provide additional details later in the call. As I reflect on our performance, it is clear our people provide the foundation for delivering these impressive results. During the quarter, I launched our first Leadership Catalyst event. This event brought together our top 75 leaders to engage them in leading the Atmos way. This enabled us to engage key leaders in our purpose, culture and strategy. The themes for the event were empowered, learning, and customer focus. The energy and excitement I felt from my engagement with this group of extraordinary leaders fuels my passion to unleash the full potential of Atmos. As I have previously highlighted, our growth strategy is focused on four pillars. Grow share in first fit in core markets. Accelerate profitable growth in the aftermarket, transform our supply chain, and expand into industrial filtration markets. Our product and technology leadership form the cornerstone for growth in our core first fit and aftermarket segments. Our iconic Fleetguard brand is recognized in the industry as being synonymous with premium products. We have a unique multi-channel path to markets. Our global presence provides us a diverse customer base across truck, bus, agriculture, construction, mining, and power generation and markets. With over 80% of our business being aftermarket, we are well positioned to deliver strong results through the cycles. Our filters are available in over 45,000 independent aftermarket retail outlets. We will continue to grow the retail presence of FleetValve products with expanded partnerships and improved availability. Our delivery metrics continue to rise, providing our customers the right product at the right time. I have been impressed by our team's ability to drive superior performance in product availability. Achieving our growth and delivery targets will be fueled by the continued transformation of our supply chain. In addition to the Brazil and Mexico distribution facilities we brought online earlier this year, we expect our Dallas facilities to be operational in the fourth quarter. As we progress through 2024, we expect additional facilities to be operational across multiple locations in Europe, and Asia Pacific, providing us with a greater ability to enhance customer satisfaction. We also continue to evaluate a robust pipeline of opportunities aligned with our strategy for inorganic expansion into the industrial filtration markets. While we are enthusiastic to execute on this opportunity, we intend to pursue this growth through a disciplined, programmatic approach. I will continue to update you on our progress. This is an exciting time for Atmos and our customers. I am confident we have the right strategy to deliver superior results, and we have a strong, energized team who are demonstrating accelerated execution of our plan. Now, I will turn the call over to Jack.