Cooper-Standard Holdings Inc.

Good morning, ladies and gentlemen, and welcome to the Cooper Standard Second Quarter 2021 Earnings Conference Call. During the presentation, all participants will be in a listen-only mode. Following the company's prepared comments, we will conduct a question-and-answer session. At that time, if you have a question, you will need to press the star followed by the 1 key. As a reminder, this conference call is being recorded, and the webcast will be available on the Cooper Standard website for replay later today. I would now like to turn the call over to Roger Hendrickson, Director of Investor Relations.

Thank you, Stacey, and good morning, everyone. We appreciate you spending some time with us this morning. The members of our leadership team who will be speaking with you on the call this morning are Jeff Edwards, Chairman and Chief Executive Officer, and John Banas, Executive Vice President and Chief Financial Officer. Before we begin, I need to remind you that this presentation contains forward-looking statements. While they are made based on current factual information and certain assumptions and plans that management currently believes to be reasonable, these statements do involve risks and uncertainties. For more information on forward-looking statements, we ask that you refer to slide three of this presentation and also the company's statements included in periodic filings with the Securities and Exchange Commission. This presentation also contains non-GAAP financial measures. Reconciliations of the non-GAAP financial measures to their most directly comparable GAAP measures are included in the appendix to the presentation. With those formalities out of the way, I'll turn the call over to Jeff Edwards.

Thanks, Roger. Good morning, everyone. We appreciate the opportunity to review our second quarter results and provide an update on our ongoing strategic initiatives and outlook. To begin, on slide five, we provide some highlights or key indicators of how our operations performed in the quarter. We continue to perform at world-class levels in delivering quality products and service to our customers and keeping our employees safe. At the end of the quarter, 98% of our customer scorecards for product quality were green and 97% were green for launch. Most importantly, the safety performance of our plants continues to be outstanding. In the second quarter, our total safety incident rate was just 0.41 per 200,000 hours worked, well below the world-class rate of 0.57. I'd like to recognize and thank our teams at the 35 Cooper Standard plants that have maintained a perfect safety record of zero reported incidents for the first half of the year. We're continually striving for zero safety incidents at all of our plants and facilities, and these 35 locations are leading the way and continue to demonstrate that achieving our ultimate goal of zero incidents is possible. From a financial perspective, our results were impacted by volatile production schedules, late notice shutdowns, and rapidly increasing costs that continued throughout the quarter. Unfortunately, all factors largely outside of our control. In the areas we can control, our teams continue to drive success. Despite lower than expected production volumes, our manufacturing operations were able to deliver $12 million in savings through lean initiatives and improving efficiency in the quarter. Our SGA and E expense was down $6 million year over year. And the combination of past restructuring actions and strategic divestitures delivered $9 million in benefits in the quarter. While we are continuing to execute well on our operating plans, we face significant ongoing challenges from customer schedules, reduced production volumes, and inflation. We're taking aggressive actions to mitigate or recover the incremental cost imposed on our business. With all due respect, we do not intend to use our balance sheet to finance the supply chain issues or the inflation of raw materials at these new levels. Our world-class quality, service, and innovative technology continue to garner recognition and awards from our customers. During the second quarter, we were again recognized by General Motors as a supplier of the year in two product categories. This marks the fourth consecutive year that we have received these honors. In addition, 20 of our manufacturing facilities were recognized with General Motors Quality Excellence Award. We're very proud of our global team for their professionalism and consistency in delivering value to our customers year after year. Our customer relationships simply have never been better. Moving to slide seven, in conjunction with the Supplier of the Year Award, we were also pleased to receive General Motors' coveted Overdrive Award. The Overdrive Award is a distinction reserved for suppliers who display outstanding achievement within high-priority areas, including sustainable value streams, total enterprise cost and profitability, safety, launch excellence, accelerating innovation, and nurturing relationships. In our case, we received the award for our Fortrex chemistry platform and its significant contribution to sustainability. While Fortrex offers superior product performance in the areas of compression set, resilience, weatherability, and resistance to degradation from exposure to ultraviolet rays and overall durability. It's sustainability impact that is even more powerful. Fortrex offers dramatic reduction in greenhouse gas emissions through an estimated four pound system weight savings, improved manufacturing efficiencies and the elimination of high use energy process capital equipment. In total, Fortrex offers up to 53% reduction in total lifecycle carbon footprint versus traditional materials. We continue to believe that our Fortrex chemistry platform, with all of its inherent benefits, will become an increasing competitive advantage and growth driver for us as current and new customers become familiar with the significant advantages it provides. especially given its carbon footprint and sustainability impact. Moving to slide eight, we continue to build a corporate culture that places a high value on long-term ESG performance and sustainability. To assure our continued progress, our Global Sustainability Council will provide executive-level oversight for the company's sustainability strategy and ensure alignment and integration with business goals and stakeholder priorities. In addition, the Council will track the rapidly evolving standard measures in global best practices to help drive Cooper Standard toward world-class performance and sustainability. We're proud of our culture we've established within the company. We believe it will be a key factor in our long-term growth and success as we further align our priorities with those of our stakeholders. Now let me turn the call over to John to discuss the financial details of the quarter.