AptarGroup, Inc.

Ladies and gentlemen, thank you for standing by. Welcome to Aptar's 2022 second quarter conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session. Introducing today's conference call is Mr. Matt Della Maria, Senior Vice President of Investor Relations and Communications. Please go ahead, sir.

Thank you. Hello, everyone, and thanks for being with us today. Joining me on today's call are Stefan Tanda, President and CEO, and Bob Kuhn, Executive Vice President and CFO. Our press release and accompanying slide deck have been posted on our website. If you are following along on our website, you can advance the slides by hovering over the presentation screen and clicking on the arrows on the right and left. As always, we will post a replay of this call on our website. Today's call includes some forward-looking statements. Please refer to our SEC filings to review factors that could cause actual results to differ materially from what we are discussing today. I would now like to turn the conference call over to Stephan.

Thank you, Matt, and good morning, everyone. We appreciate you joining us on our call today. Some of you may be aware that Matt will be retiring at the end of this year after 32 years of dedicated service to APTAR. We are thankful for Matt's leadership and will have time to wish him well over the coming months as he transitions his role to the experienced and very capable hands of Mary Scafidas, who joined us just a little over a month ago. Mary joins us from the Lowe's Corporation, where she most recently served as the head of Investor Relations, Corporate Communications, and ESG for many years and has prior leadership experience with McGraw-Hill and Toyota Motor. Now let's turn to slide three, As you can see, APTA delivered a strong second quarter. Each of our segments contributed positively to our top-line growth for the quarter as well as for the first half of the year. Growth in our second quarter was achieved by increased volumes and pricing initiatives. Our team achieved this solid performance during an exceptionally dynamic and uncertain period. I think it is important to note that we are very well positioned for continued growth. The areas of our business that were negatively impacted by the pandemic, such as our prescription drug, consumer health care, and beauty solutions, are now recovering. We are investing in capacity in our pharma and beauty segments following our regional manufacturing strategy that will allow us to grow with our customers as they also benefit from life returning to a new normal. Our CFO, Bob Kuhn, will review some details from the quarter later on in this call, but first I would like to touch on some highlights. Apta Pharma achieved double-digit core sales growth with increased volumes across all our major healthcare markets. Our prescription business has worked through the 2021 destocking situation and is ramping up toward pre-pandemic levels. Higher sales of our delivery devices for allergy, emergency, and pulmonary medicines drove the growth in the prescription drug market. As many people around the world experience colds and cold-like symptoms, including from COVID-19 Omicron infections, demand for nasal decongestion and other cough and cold treatments increased briskly in the consumer healthcare market. Demand also increased for injectable medications components and active material science solutions, even with tough year-on-year comparisons. Profitability in our pharma segment is within our target range and includes the previously anticipated dilutive impact from our recent digital healthcare acquisitions and some startup costs related to our expansion of our elastomer components capacity, which is on schedule and expected to progressively come on stream starting in late 2022, throughout 2023, and into early 2024. In our beauty and home segment, increased demand from the beauty and personal care markets, as well as our pricing initiatives, contributed to double-digit core sales growth. We saw significant year-over-year sales increases in prestige fragrance, facial skin care, color cosmetics, hair care, and sun care. Duty and home margins are recovering in Europe and China, but are being held back by continued labor shortages in North America and uneven demand in Latin America. We will not be satisfied until we move within our long-term target range, and we will continue to diligently manage our costs while we prepare to implement further price adjustments to recover the input cost inflation. Finally, growth in our food and beverage segment was driven primarily by pricing with volumes up slightly. A softening of demand in the food market, especially in the U.S., following a period of strong growth, was offset by increased volumes in beverage. Margins reflect the weaker food volumes as well as the effects from inflation. Turning to slide four, I want to take a moment to talk about a key priority for APTAR, capital allocation. We deployed over $3 billion in the past five and a half years, balanced across investing in our business, making acquisitions, and returning capital to shareholders in the form of dividends and share repurchases. In the first half of 2022, we had capital expenditures of approximately $150 million, The majority of these expenditures were in our pharma segment, including expansions in the U.S., France, and China. We also returned over $100 million to shareholders through dividends and share repurchases. We are in our 29th year of paying an increased annual dividend total, and we have repurchased shares every year since 1999, except, of course, for 2020. Moving to slide five, another StatFast focus has been ESG. And we are pleased to share the many milestones and achievements surrounding our progress in 2021 with the release of our annual Corporate Sustainability slash ESG report, which is prepared in accordance with the Global Reporting Initiative standards and shows our alignment to the UN Sustainable Development Goals. We also published our second UN Global Compact Communication Progress Report, in addition to publishing new summaries for ZASB, the Sustainable Accounting Standards Board, and TCFD, the Task Force on Climate-Related Financial Disclosures. We are actively working toward a more sustainable future for all as we develop faster ways to deliver critical medicines, enable families to recycle more plastic, and improve our operations to reduce greenhouse gas emissions. This priority is not only good for our planet, but it's good for business, helping us mitigate enterprise risk, and I am convinced helps us to future-proof the company. Aptar is known for its focus on innovation, quality, and services that go far beyond drug delivery, dispensing, or packaging. Our technologies are often used across a number of markets we serve, and we participate in a number of new product introductions each quarter. Turning to slide six, our pharma segment continues to supply nasal delivery devices for the administration of emergency medicines, such as the opioid overdose antidote Naloxone, where we supply the leading brand, as well as several generic players. A new acne dermal medication recently came to market with our airless pump system. Also, our components for injectable medications have been chosen for use with a variety of drugs in the US. As shown on slide seven, in the beauty market, we supplied solutions for several new launches in the quarter, including multiple new fragrance launches in Europe and Latin America, and facial skin care and hair care product in Asia. Regarding China specifically, our multinational Western customers who are doing business there, as well as our local customers, are quite bullish as things begin to open up, and we were encouraged with the level of activity we saw in the quarter. Also on slide seven, in the food and beverage markets, We continue to see squeezable formats come to market using our custom pouch fitments and flow control enclosures, while we helped a local Chinese food company launch a new powdered milk infant formula using our sealing and dispensing closure. We also are encouraged by demand for our food service tray technology, which can enhance freshness and extend shelf life, and have been adopted by a major fast food chain in the U.S. This latest product is from Aptar CSB Technologies, a company we acquired in 2018. Many of our shareholders know this part of the business because of the extraordinary growth it achieved during COVID, supplying test kit manufacturers with its active film technology. Another application of its film is for protecting and extending the shelf life of food. This is a great example of selling one technology across multiple end markets. And these are but a few examples of some of the new applications brought to market with our solutions in the quarter. With that, I will now turn it over to Bob, who will share some additional comments on our quarterly results. Bob.