DuPont de Nemours, Inc.

question, press star 1 again. Thank you. I will now turn the call over to Chris McCrae. You may begin your conference.

Good morning and thank you for joining us for DuPont's fourth quarter and full year 2023 financial results conference call. Joining me today are Ed Breen, Chief Executive Officer, and Lori Koch, Chief Financial Officer. We've prepared slides to supplement our remarks, which are posted on DuPont's website under the investor relations tab and through the webcast link. Please read the forward-looking statement disclaimer contained in the slides. During this call, we'll make forward-looking statements regarding our expectations or predictions about the future. Because these statements are based on current assumptions and factors that involve risks and uncertainties, our actual performance or results may differ materially from our forward-looking statements. Our Form 10-K, as updated by our current and periodic reports, includes detailed discussion of principal risks and uncertainties which may cause such differences. unless otherwise specified, all historical financial measures presented today are on a continuing operations basis and exclude significant items. We'll also refer to other non-GAAP measures. A reconciliation to the most directly comparable GAAP financial measure is included in our press release and presentation materials and have been posted to DuPont's Investor Relations website. I'll now turn the call over to Ed.

Good morning, and thank you for joining our fourth quarter and full year 2023 financial review. This morning's earnings release is consistent with the preliminary results announced on January 24th, and we have added our customary segment detail and end market color, while also providing incremental detail on our 2024 financial forecast. Broadly, we continue to see encouraging stabilization within electronics markets. Our semiconductor technologies business reported sequential sales growth of 2% in the fourth quarter, as expected. as the first sign of getting past the bottom in chip production. In interconnect solutions, we saw a return to year-over-year volume growth, with volumes up 2% versus the prior year after sales bottomed earlier in 2023. However, as we finished 2023, we did see additional channel inventory destocking within many of our industrial-based businesses, as well as continued weak demand in China with incremental weakness in our China water business. This resulted in fourth quarter net sales, which declined 7% year over year, falling below our guidance expectations. We have already noted that we see a continuation of similar volume trends into the first quarter. And I will come back to this, but we are encouraged that we see signs of market stabilization, bottoming of customer inventories, and a pickup in orders in the month of January that support a view of recovering sales and earnings through 2024. Fourth quarter operating EBITDA of $715 million was down 6% year over year, reflecting continued pressure across many of our largely short cycle businesses. We remain very focused on managing what we can control, including discretionary spending levers, and also executing the restructuring actions announced last November. This focus helped to contain margin impact in the period despite a 9% drop in volume. Looking into 2024, we continue to target annualized cost savings of $150 million, which we will begin to realize later in the first quarter and which should further bolster our go-forward margin profile. I am pleased we finished the year with strong cash generation as we continue to prioritize working capital improvement and discipline following the inventory build seen during the supply challenge 2022 period. For the full year, adjusted free cash flow was $1.6 billion, with conversion at 100% versus our target of greater than 90%. This included fourth quarter adjusted free cash flow of $501 million, which represented 133% conversion. Adjusted EPS for the year of $3.48 per share increased over last year as benefits from our ongoing capital allocation and sharing purchases more than offset substantial volume decrements. Turning to slide four, we continue to execute on our capital allocation priorities. First, this morning we announced that we completed the $2 billion accelerated share repurchase transaction launched last September. At the conclusion of the ASR transaction, we retired an additional 6.7 million shares with the TRUA, bringing the total to 27.9 million shares retired under the $2 billion ASR. Completion of this ASR wraps up the $5 billion program that we announced in November 2022, enabling a repurchase of approximately 15% of our outstanding shares over this time period. We also announced that our board approved a new 1 billion share repurchase program, and we intend to launch a new 500 million ASR transaction imminently. We expect to complete the full 1 billion program by the end of this year. Finally, today we also announced an increase in our quarterly dividend to $0.38 per share, or a 6% increase. We will continue to target a dividend payout ratio of 35% to 45% over time and expect to increase our dividend annually in line with earnings growth. We exited 2023 in a favorable balance sheet and liquidity position with an adjusted net leverage ratio of 2.1 times and with no long-term bond maturities due until November of 2025. We also repaid $300 million in debt due during the fourth quarter with cash on hand. Finally, we also continue to invest in innovation and our operational excellence program to support long-term organic growth. In 2024, we expect capital spending at about 5% of sales and target R&D spend at about 4% of sales for total DuPont. Regarding our innovation and growth pipeline, we were pleased during the fourth quarter with our electronics portfolio to be selected by a leading USOEM for our microfill metallization product, which offers improved plating uniformity for advanced computing. In water, our team significantly advanced commercialization of the oxymembrane products for wastewater biological treatment. Within industrial, our CalRes business opened a new facility in Delaware to support growth for its global semiconductor products. And finally, within adhesives, we launched a new structural epoxy adhesive specific for a larger scale energy storage system. Before I turn it over to Lori, Let's review our expected demand outlook by business based on active conversations that we have had with customers recently. For electronics, our ICS business serving printed circuit boards already bottomed in mid-2023 and continues to gradually recover alongside global electronics demand. We expect utilization for our customers in this area to increase this year into the 60s on a percentage basis from the mid-50s in the first quarter. For semiconductor industry forecasts for chip production that were pushed out several times in 2023 are signaling a firmer 2024 recovery, and our outlook assumes chip fab utilization increasing through the year to exit at a run rate around the low 80s on a percentage basis from the low 70s in the first quarter. This inflection also includes stabilization for in-market consumption in smartphone, PC, and tablet markets, driven in part by replacement demand, as well as improved data center demand, bolstered by AI-driven growth. These trends bode well for DuPont's strength within electronics materials, and our customers are pointing to improved volume in both SEMI and ICS during 2024. Within our industrial-based businesses, while inventory destocking impacts have continued into the first quarter, customer feedback indicates a positive order inflection as the year progresses. Let's review specific end markets. First, Shelter, which saw notable destock in 2023, now sits with inventory back to normal levels, and we expect a slight positive volume compare in 2024, beginning in the first quarter. In safety, we believe our customers' inventory is also close to normal at this point for Tyvek medical packaging, and we expect sales to recover during the second and into the third quarter. Further, we expect reduced destock impact within safety solutions across a couple of industrial end markets in the second half. In water, we have communicated with our distributor customers in China, and we expect a sequential pickup in sales. towards the end of the second quarter. Distributor inventories have declined substantially from the peak last year. Finally, I would mention that we expect to see order improvement over the next several quarters in our CalRES business with industrial solutions. Our Livio biopharma business is anticipated to recover later in the second half. So we have firm signals from a wide range of businesses within the DuPont portfolio that support a sales bottom in early 2024. This is reflected in stronger orders during the month of January after continued weakness in December. To wrap up, we remain confident that our key end markets are well positioned for long-term growth, and our teams are extremely focused on operating discipline and site-level execution, which positions us well to accelerate growth as inventory is normalized. With that, I'll turn it over to Lori to cover the financial results and outlook in detail.