Element Solutions Inc.

any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I will now turn the call over to Varun Gokarn, Vice President, Strategy and Integration. Please go ahead.

Good morning, and thank you for participating in our fourth quarter and full year 2024 earnings conference call. In accordance with regulation FD, we are webcasting this conference call. A replay will be made available in the investor section of the company's website. During today's call, we'll make certain forward-looking statements that reflect our current views about the company's future performance and financial results. These statements are based on assumptions and expectations of future events which are subject to risks and uncertainties. Please refer to the earnings release supplemental slides and most recent SEC filings on our website. or discussion of material risk factors that could cause actual results to differ from our expectations and predictions. Today's materials include financial information that has not been prepared in accordance with U.S. GAAP. Please refer to the earnings release supplemental slides for definitions and reconciliations of these non-GAAP measures to comparable GAAP financial measures. It is now my pleasure to introduce our CEO, Ben Glicklich.

Thank you, Varun. Good morning, everybody. Thank you for joining. Element Solutions had an outstanding year in 2024. We produced record results, improved our portfolio, and positioned the company for longer-term outperformance. We delivered a full year adjusted EBITDA above the high end of our original guidance range, despite a material incremental FX headwind that had built over the year. The company improved meaningfully across multiple vectors in each of our businesses. We outperformed our markets, penetrating the fastest growing emerging niches in the electronics industry, driving margins and investing in new capabilities. Adjusted EBITDA grew 13% in constant currency to a record $535 million. Free cash flow of $294 million was a record as well. It was our fifth year out of the past six in which we converted more than 50% of adjusted EBITDA to free cash flow, and that is despite having more opportunities to invest in growth and therefore spending more on CapEx than in prior years. These results were not a product of a generally exuberant market backdrop. Only select niches of the electronics industry were strong, while a large portion across consumer goods and automotive was generally soft. MSI growth came in well below the market's expectation entering the year, and our industrial business fought headwinds from low levels of activity in construction, heavy machinery, and Western automotive manufacturing. Notwithstanding that backdrop, we met our financial commitments in 2024, But more importantly, we made meaningful progress continuing to position our business for longer-term outperformance. We're a critical supplier of solutions for leading-edge electronics hardware. Our product roadmaps are increasingly informed by and critical to emerging needs in high-performance computing markets. And our relationships with the key specifiers and technologists in the markets are strengthening. We worked hard to bring our margins back close to their prior high. With over 100 basis points of EBITDA margin expansion in 2024, we've just about accomplished that. We've shown price discipline and driven positive mix through our progress in high-value niches in electronics. And we're back at those levels in a period of weak volume in industrial and assembly, so we see a path to set new record margins from greater facility utilization and further mix improvement from here. In 2024, we also took steps to focus and enhance our portfolio. In September, we announced an agreement to sell McDermott Graphic Solutions for $325 million. This is a good business, but it contributed lower growth and margins and with weaker cash flow conversion than the rest of our businesses. We were able to structure the transaction to take advantage of tax assets, such that we should net almost all of the proceeds. It's expected to close in the first quarter, subject to customary closing conditions and adjustments. And so we are left here with a better portfolio across all key relevant metrics that we believe is also better positioned for growth and a balance sheet that is as good as it has been since we founded ESI. This is all to say that while we're pleased with a record year in 2024, we're even more excited about what we were able to do last year to position the business for longer-term success. Cary, we'll now take you through the fourth quarter and full-year financials in more detail. Cary? Thanks, Ben.