Graham Corporation

Greetings. Welcome to Graham Corporation's fourth quarter fiscal year 2024 financial results conference call. At this time, all participants are in listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference today, please press star zero from your telephone keypad. Please note this conference is being recorded. At this time, I'll now turn the conference over to Debbie Pulaski, Investor Relations for Graham Corp. Debbie, you may now begin. Thank you, Rob.

And good morning, everyone. We certainly appreciate your time today and your interest in Graham Corporation. Here with me on the call are Dan Thorin, our President and CEO, and Chris Thome, our Chief Financial Officer. Dan and Chris are going to provide their formal remarks, after which we will open the line for questions. You should have a copy of the fourth quarter full year 2024 financial results that were released this morning. If not, you can access the release on our website at ir.gramcorp.com. You will find there as well the slides that will accompany today's discussion. If you turn to slide two, I will review the safe harbor statement. You should be aware that we may make some forward-looking statements during the formal discussion as well as during the Q&A session. These statements apply to future events that are subject to risk and uncertainties, as well as other factors that could cause actual results to differ materially from what is stated here today. These risks and uncertainties and other factors are provided in the earnings release, as well as with other documents filed by the company with Securities and Exchange Commission. You can find those documents on our website or at SEC.gov. During today's call, we will also discuss some non-GAAP financial measures. We believe these will be useful in evaluating our performance. However, you should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP. We have provided reconciliations of non-GAAP measures with comparable GAAP measures in the tables that accompany today's release and slides. We also use key performance indicators to help gauge the progress and performance of the company. These key performance metrics are orders, backlog, and book-to-bill ratio. They are operational measures, and a quantitative reconciliation of each of these is not required or provided. You can find the disclaimer regarding our use of key performance metrics at the back of our deck in the supplemental slides. I should also point out that we do post on our website supplemental data information regarding orders, revenue, and backlog that you might find useful, as well as another tab this quarter that will help to provide you historical adjusted EPS and adjusted EBITDA, which the form of reporting has changed that Chris will discuss more fully during the call. So with that, if you would please advance to slide three, I'll turn it over to Dan to begin. Dan?

Thanks, Debbie, and good morning, everyone. Steady execution on our strategic plan that we laid out two years ago has resulted in strong financial performance and meaningful progress towards our long-term goals. In fiscal 24, we achieved record revenue and orders, a step change improvement in profitability, and strong cash flow. Our improved performance, strengthened balance sheet, and increased financial flexibility has enabled us to make meaningful investments to further grow the business both organically and inorganically. We eliminated our debt and also refinanced for more flexibility and lower rates. We believe these results validate the effectiveness of our strategic growth and profitability initiatives. The most important driver of our success has been our strong relationship with the US Navy. During the year, we completed and shipped the remaining two first article units, which were heat exchangers for the naval nuclear propulsion program used in the Columbia-class submarine and Ford-class carrier programs. Importantly, we have taken the lessons learned throughout the first article process to enable greater production efficiencies, and along with better pricing on subsequent orders, expand our margins. The Navy expansion in Colorado has also been successful, resulting in higher production rates to support the Mark 48 Mod 7 heavyweight torpedo program. The higher volume translated into operating leverage to drive profitability as well. At the core of our company are our employees. We have strategically expanded our workforce with targeted hires while advancing our team through comprehensive development programs. Additionally, we have refined our leadership structure, resulting in improved execution and outstanding performance, as demonstrated by our recent results. In addition to the improvements around the defense side of our business, we've also gained better insight and leverage on the commercial side and captured better pricing power to expand our margins. The acquisition of P3 Technologies is a great example of our strategy to add complementary technology to expand our turbo machinery solutions and enhance our engineering and development team. We have successfully integrated P3 into our Barbara Nichols operations. In addition to providing the manufacturing capabilities to help scale the business, we plan to leverage their patented technologies to further deepen our reach into existing space, defense, and new energy markets, while increasing market diversification with the technology solutions for the medical industry. Another highlight of fiscal 24 was the $13.5 million strategic investment we received from a major defense customer to expand and enhance our Batavia New York production capabilities. Design on the new facility is nearly complete, and we expect to break ground in July. This expansion provides the capacity we need to support the U.S. Navy's shipbuilding schedule and meet expanded scope requests. The pie charts on slide four visually depict the diversity within our served markets and the evolving market mix over the past three fiscal years. the impact of our strategic initiatives is clearly evident. Since fiscal 21, our revenue has nearly doubled, with a noticeable shift towards the defense sector and the addition of space. Furthermore, the other category now includes new energy and medical markets. Overall, the diverse industry mix underscores our strategic approach, ensuring resilience and mitigating risk. With that, let me turn it over to Chris for the financial details. Chris?