Avantor, Inc.

After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press star, then the number one on your telephone keypad. If you'd like to withdraw your question, press the pound key. Thank you. Helen O'Donnell, Investor Relations Contact. For a volunteer, you may begin your conference.

Thank you, and good morning, everyone. Our speakers today are Michael Stubblefield, President and Chief Executive Officer, and Tom Slozek, Executive Vice President and Chief Financial Officer. The press release and a slide deck accompanying this call are available on our investor website at ir.avantoursciences.com. A replay of this webcast will also be available on our website following this call. Following our prepared remarks, we will open up the lines for questions. I would like to note that we will be making some statements during the call that are forward-looking statements within the meaning of the federal securities laws. including statements regarding events or developments that we believe or anticipate may occur in the future. These forward-looking statements are subject to a number of risks and uncertainties, including those set forth in our SEC filings. Actual results might differ materially from any forward-looking statements that we make today. These forward-looking statements speak only as of the date that they are made, and we do not assume any obligation to update whether as a result of new information, future events, and developments or otherwise. This call will include a discussion of non-GAAP measures. A reconciliation of these non-GAAP measures can be found at the back of the presentation. With that, I will now turn the call over to Michael.

Thank you, Helen. Good morning, everyone. Welcome to Avantor's first quarterly earnings call as a public company following the successful completion of our initial public offering in May. We are pleased to report strong second quarter results with outstanding organic growth margin expansion, and cash flow generation. Before discussing the quarter in more detail, I would like to provide a brief overview of the business and Avantor's customer-centric model. Avantor is among the most recognized and trusted global providers of products and services to the life sciences and advanced technology and applied materials industries. Our customers rely on us in virtually every stage of the most important research, development, and production activities they perform. and they value and trust our integrative approach. It is the basis for our enduring relationships. We believe that our customer-centric model differentiates us from other industry participants and suppliers. One of Avantor's greatest strengths comes from our global footprint that enables us to serve more than 240,000 customer locations, giving us extensive access to research labs and scientists in more than 180 countries. With this access, we're able to position our comprehensive portfolio of products and solutions for a wide variety of customer workflows. Importantly, as we engage scientists in early phase discovery work, we can customize solutions that often get specified into customer formulations, driving stickiness and recurring revenue as these platforms are commercialized. We extend our reach and further embed ourselves in our customers' workflows through our robust service capabilities. and our offering is underpinned by a world-class quality system and robust supply chain that enables us to meet the stringent requirements of an exacting customer base. This differentiated framework enables us to partner with our customers every step of the way as they bring critical, life-saving therapies to patients around the world. The value of our model is evident in our attractive growth, margin, and deleveraging profile. We have a very diverse revenue base that spans a wide range of customer applications and end markets. When combined with the customized nature of our business, it makes for a very resilient model. We are well positioned for continued growth in the Americas and Europe, and are realizing upside from outsized growth in Asia, the Middle East, and Africa, where our infrastructure and footprint continue to expand. For example, During my recent trip to China, I was able to see firsthand the progress we are making on the construction of our new application and technology center that will open in Shanghai later this year. Avantor offers a comprehensive portfolio that includes more than 6 million distinct products and services that enable us to contribute to some of the most demanding and challenging areas of science. Approximately half of our revenue comes from the Avantor branded solutions and roughly 85% of our business is recurring. We strategically serve four end markets that share similar characteristics, including high regulatory oversight and complex development processes. Our penetration of market leaders and startups alike is a proof point of our relevance and importance in the industries we serve. We are well diversified as no single end customer represents more than 4% of our net sales. With more than half of our revenue in biopharma and healthcare, we are well positioned to leverage the favorable macro trends in the life sciences space. Our largest customer end market is biopharma, where industry dynamics remain favorable, especially for the large molecule space, where we are well positioned to support our customers across a range of disease indications, including oncology, rheumatology, respiratory, and neurodegeneration. Given the breadth of our solution and our access to the critical phases of early stage development, we ultimately earn specifications that allow us to serve our customers' critical workflows at production scale. This slide demonstrates the breadth and relevance of our solution for biopharma manufacturing. Our solution spans the upstream fermentation processes that drive cell growth and protein expression, the downstream protein recovery and purification steps, as well as the final formulation processes. Our solution is underpinned by our single-use sterile fluid transfer technologies that connect each of the unit operations, helping to minimize the risk of product contamination. Our penetration of market leaders is a proof point of our relevance and importance in this critical workflow. We are specified into more than 80% of the top 20 biologic drugs and have a leading position in our core technologies, including buffers and excipients. Our recently completed IPO was the largest healthcare IPO in US history and provides us with a stronger financial position to continue to grow our business. Given strong investor demands, we were able to build a high-quality, blue-chip investor base and increase the total capital raised to $4.4 billion. We used the proceeds to retire $2.6 billion of senior preferred equity and pay down $1.6 billion in term loans. Following the IPO, we received upgrades from all three rating agencies and successfully repriced our term loans. With these actions, we reduced our annual interest expense by more than $100 million annually. With our improved capital structure and continued strong business performance, we reduced our leverage 1.8 turns in the second quarter, positioning us to end the year with leverage near 4.5 times. Turning to our second quarter business results, our strong momentum continued and we delivered another excellent quarter with 6.1% organic revenue growth and a 140 basis point improvement in adjusted EBITDA margin. Importantly, we made great progress in executing our growth strategy. We had a number of significant contract wins and renewals, made key additions to our product portfolio, and realized a substantial increase in web activity following recent investments to our e-commerce platform. In addition to delivering a record quarter in our bioproduction platform, we secured a major supply position with our aseptic single-use technology for a leading pharmaceutical customer that is launching a life-saving gene therapy treatment. We also broke ground on a new biorepository facility in Germany, reinforcing our commitment to the services platform and enabling sustained double digit growth. Our integration of BWR continues to track ahead of schedule, including realization of synergies. As we have previously outlined, we expect to capture more than 300 million of cost and commercial synergies by the end of 2020. As of the end of the second quarter, our program is more than three quarters complete with a run rate impact of approximately 230 million. These synergies are an important driver of our margin expansion and overall value creation. As I referenced earlier, we reduced our leverage in the second quarter by 1.8 turns, with 0.3 turns coming from our operational performance within the quarter. We remain committed to deleveraging our balance sheet by roughly one turn per year. as we look to operate in a more normalized leverage range long-term. Before I hand off to Tom to discuss our second quarter results in more detail, I would like to remind you of our long-term financial goals and convey how well we performed against them this quarter. Avantor's organic growth of 6% demonstrates the continued momentum of our business as well as the value of our integrated platform. Our operational discipline and synergy capture drove significant margin expansion and increased unlevered free cash flow. As I referenced earlier, we are on pace to end the year with leverage near four and a half times and are well positioned for a strong finish to 2019. Now, I'd like to turn the call over to Tom to review our financial performance in more detail.