Barrick Mining Corporation

Good day and thank you for standing by. Welcome to the Barnes Group first quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 1 on your telephone. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker today, Bill Pitts, Director of Investor Relations. Please go ahead.

Thank you, Megan. Thank you, Megan. Good morning, everyone, and thank you for joining us for the first quarter 2021 earnings call. With me are Barnes Group's President and Chief Executive Officer, Patrick Dempsey, and Vice President, Controller, and Interim Chief Financial Officer, Marion Acker. If you have not received a copy of our earnings press release, you can find it on the investor relations section of our corporate website at bginc.com. During our call, we will be referring to the earnings release supplement slides, which are also posted on our website. Our discussion today includes certain non-GAAP financial measures which provide additional information we believe is helpful to our investors. These measures have been reconciled to the related GAAP measures in accordance with SEC regulations. You will find a reconciliation table on our website as part of our press release, and in the form 8K submitted to the Securities and Exchange Commission. Be advised that certain statements we make on today's call, both during the opening remarks and during the question and answer session, may be forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those projected. Please consider the risks and uncertainties that are mentioned in today's call and are described in our periodic filings with the SEC. These filings are available through the investor relations section of our corporate website at BGINC.com. Let me now turn the call over to Patrick for his opening remarks. Then Marion will provide a review of our financial results and details of our updated outlook for 2021.

after that we'll open up the call for questions patrick thank you bill and good morning everyone barnes group delivered a very good quarter to begin 2021 with the recovery we had anticipated to occur later in the year starting a little earlier than expected strong order intake continuing sequential revenue growth now for the third consecutive quarter and better-than-expected earnings performance add confidence to our view that the second half of the year will show meaningful recovery progress. For the first quarter, organic sales were down 10% compared to a year ago as a result of lower volumes at aerospace. However, our industrial segment generated high single-digit organic growth, which was better than our February expectation given solid orders and sales in March. While we previously envisioned business improving as the year progressed, now with the stronger momentum exiting the first quarter, we have increased our outlook for the year. Earnings per share were $0.38, down 46% from last year's adjusted $0.71, though firmly exceeding the high end of our February expectation. Moving now to a discussion of end market dynamics, beginning with industrial. Our industrial segment had a strong first quarter, with each of our SBUs generating year-over-year organic sales and revenue growth. For the segment, orders were up 25% organically, with a book-to-bill of approximately 1.1 times. Sequential orders were up 7%, further exemplifying the momentum we're seeing. On a macro level, manufacturing PMIs in the US and Eurozone remain particularly robust. China, while a bit softer, remains in expansion territory. And despite the semiconductor issue that's impacting automotive bills, IHS still predicts 2021 global production to be up 12% over last year. Within the segment, Our molding solutions business had strong orders across all brands, up 35% organically. Our larger end markets, automotive, medical, packaging, and personal care, each saw in excess of 25% orders growth, some well above that. Sequentially, orders improved high single digits, marking the fourth quarter in a row of sequential growth. Organic sales were up mid single digits, while sequential sales were up low single digits. Book-to-bill was approximately 1.1 times. Backlog, which is predominantly our longer cycle mold systems, grew by approximately 25% year over year and low double digits from the fourth quarter of 2020. There's definitely a lot to like about the activity of molding solutions. and the business has been recently adding more talent to the sales and marketing team with a clear focus on driving long-term growth and margin expansion. While near-term investments in such talent, coupled with our innovation and digital initiatives that I discussed last quarter, will hinder short-term margins, we expect long-term performance to benefit. Our 2021 expectation for molding solutions has improved as we now forecast organic sales growth to be in the low teens. Moving to force and motion control. Organic orders were up low double digits, with organic sales up high single digits. FMC, via its cheap metal forming end market, is seeing the benefit of its automotive customers pushed to electric and hybrid vehicles. Year-over-year orders are up across each of our primary geographic markets, North America, Europe and China. Likewise, we're seeing good demand in our general industrial end markets, particularly heavy duty truck and industrial equipment. Our FMC sales growth expectation has likewise increased as we now anticipate organic sales to be up in the mid teens for 2021. Engineered components generated organic orders growth in excess of 25% and organic revenue growth in the low double digits. Sequentially, we saw modest growth in orders and sales, constrained somewhat by the automotive semiconductor concern. As a result of this issue, we estimate a first quarter impact of approximately $1 million. with the second quarter impact likely to be in the range of $4 to $5 million before recovering in the second half. General industrial markets remain very healthy. Our 2021 outlook has increased for this business as well, with organic sales now forecast to be up mid-teens. Moving to automation, we continue to see sequential performance in both orders and sales, upload teams and high single digits respectively. On a year over year basis, organic sales were up high single digits and organic revenues up mid-teens. A very good quarter of growth and execution from the automation team. Demand for our end of arm tooling solutions in automotive, medical and pharma and industrial automation applications remain good. as has been the trend now for a few quarters. We now expect 2021 to deliver total growth of 20% with organic growth in the mid-teens. Again, better than our February expectation. Overall, for the industrial segment, we see 2021 organic growth in the mid-teens with operating margins of approximately 13%. Moving now to aerospace. Our aerospace business experienced continuing impacts from the pandemic as OEM sales were down 32% from the prior year and aftermarket sales were down 48%. Not surprising as commercial aviation remains significantly disrupted. However, we still believe that the bottom is behind us and that we're slowly recovering. Case in point, for the third quarter in a row, we have seen total aerospace sequential sales improve. In the first quarter, the sequential improvement was driven by our MRO business. Our expectations for the aerospace industry overall have not changed. We continue to believe that OEM production levels for narrowbodies will show modest improvement, while widebodies will remain pressured. We did see a second consecutive quarter of good orders an OEM booked to bill was approximately 1.5 times. In the aftermarket, industry challenges of lower aircraft utilization, weakened airline profitability, and government-imposed travel restrictions all remain. Recovery will depend on the pace and effectiveness of vaccinations. Domestic travel activity will precede any improvement in international travel. We continue to expect aftermarket activity to gradually improve beginning in the second half of 2021. In the meantime, the aerospace team continues to execute on several items to best position our business for recovery. For example, in the first few months of the year, we completed an extension of our Westchester, Ohio facility, expanding our capabilities. received supplier recognitions from Boeing and Rolls-Royce, and announced the significant B2 bomber exhaust system contract award from Northrop Grumman. Our 2021 expectation is for OEM sales to be up mid-single digits over 2020 and spare parts down in the mid-teens, both unchanged from a prior view. Our forecast for MRO is slightly improved, now down loads single digits versus our prior view of being down mid-single digits. Segment operating margin is anticipated to be approximately 13%. Before concluding, as you may have seen with yesterday's press release, I'm happy to announce the appointment of Julie Strike to the position of Senior Vice President and Chief Financial Officer. Julie is a proven leader with significant experience leading the financial operations of global businesses. Her extensive background and proven strategic leadership in corporate finance, financial planning and analysis, mergers and acquisitions, and risk management will help us advance our long-term profitable growth strategy. At the same time, I want to acknowledge Marion for her tremendous leadership during this transition period. In closing, we're off to a good start in 2021. Favorable macroeconomic indicators and our solid orders generation provide us with a high degree of confidence in our improved outlook for the year. However, that's not to say there aren't challenges that remain, so our teams are proactively implementing risk mitigation plans. As we move forward, We'll continue to add the necessary talent and skill sets to enable us to drive growth and improve profitability. Those efforts will be supported by organic investments in innovation, digitalization, and strategic marketing. Our focus remains squarely on controlling our own destiny and positioning the company to prosper as global markets recover. Now, let me turn the call over to Marion for a discussion on the financial details.