Hillenbrand Inc

Greetings. Welcome to Hill & Brand's Fiscal First Quarter 2022 Earnings Call. At this time, all participants are in listen-only mode. The question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero from your telephone keypad. Please note that this conference is being recorded. At this time, I'll turn the conference over to Sam Minesburg, Director of Investor Relations. Mr. Minesburg, you may begin.

Thank you, operator, and good morning, everyone. Welcome to Helen Brand's fiscal first quarter of 2022 earnings call. I'm joined by our president and CEO, Kim Ryan, and our senior vice president and CFO, Christina Cernelia. I'd like to direct your attention to the supplemental slides posted on our IR website that will be referenced on today's call. Turning to slide three, a reminder that our comments may contain certain forward-looking statements that are subject to the safe harbor provisions of the securities laws. These statements are not guarantees of future performance, and our actual results could differ materially. Also, during the course of this call, we'll be discussing certain non-GAAP operating performance measures, including pro forma comparisons for our segments. I encourage you to review the appendix and slide three of the presentation, as well as our 10-Q, which can be found on our website, for a deeper discussion of non-GAAP information, forward-looking statements, and the risk factors that could impact our actual results. With that, I'll now turn the call over to Kim. Kim?

Thank you, Sam. Good morning, everyone. Thank you for joining us today, and I hope you and your families are safe and well. I'd like to begin by acknowledging the continued dedication of our more than 10,000 employees in managing the business throughout this challenging and unpredictable environment. Throughout the pandemic, we've remained committed to protecting the health and well-being of our employees in all of our locations around the world, and we appreciate their commitment to continue to serve and support our customers. Demand for our industrial products and solutions remained healthy, as evidenced by another strong quarter of order intake and near record backlog, while Batesville was relentlessly focused on serving our customers and delivered results that were above our expectation coming into the quarter. Overall, we are well positioned heading into the remainder of the fiscal year. The conditions under which we and most companies are operating have continued to face challenges. Since our last update in November, We have seen a significant spike in COVID-19 cases with the Omicron variant. Additionally, we have seen global supply challenges and labor market constraints in North America escalate throughout the quarter, and commodity inflation has not shown signs of abating. Despite these challenges, I'm proud of how our employees have responded in meeting the needs of our customers and delivering a solid start to our fiscal year. As I enter my second month as CEO, I'd like to take a moment to reiterate with you some of my key priorities as we move forward. First, to maintain our momentum as we complete the third and final year of the Millicron integration. We continue to find opportunities and remain confident in achieving our target of $75 million in run rate synergies by the end of year three. Second, to drive continued growth for Hillenbrand through innovation, new product development, and strategic acquisitions that position us for continued success in our key end market. Next, to ensure our company culture, values, and working norms are aligned to the needs of the evolving global workforce, and that we are well-positioned to retain, develop, and attract the best talent. And finally, I'm confident in our strategy, and we will continue to focus on areas where it will evolve to meet the needs of the future. As you know, our strategy is comprised of four pillars. The first strategic pillar is to strengthen and build business platforms, both organically and through M&A. We started fiscal 22 with a now streamlined portfolio and a clear line of sight to the areas we want to focus on for continued growth within our industrial platform. Demand for our products is supported by several key macro trends that we believe will position us well for the future. First, an expanding global middle class increases the demand for durable plastics, which can be created or shaped using our system. Durable plastics are a key enabler of quality and efficiency across many end markets and applications, including lightweighting in automobiles for improved fuel efficiency, more effective and safer packaging for better food preservation, more durable and energy-efficient construction materials, and improved medical product safety and therapy delivery. Additionally, we believe the desire for more sustainable solutions will create significant opportunity for Hillenbrand. As customer and consumer demands indicate an increased desire for recycled or bio-based materials, we are making investments in product innovation and test labs and forming strategic partnerships to meet these demands. Our equipment is also well-suited for the production of plant-based proteins. such as texturized vegetable proteins and high moisture meat analogs, which offer eco-friendly alternatives to animal proteins. Lastly, we see opportunity for our equipment to play a critical role in improved battery production for electric vehicles as consumers and companies look for alternatives to fossil fuels. To that end, we were recently awarded an order to partner on the first continuous production gigafactory in Europe. As customer needs in these markets continue to evolve towards higher output and more technically demanding applications, we are well positioned to meet these needs due to three key factors. Our leading product offerings, our applications engineering expertise, and our global service network. In addition to expanding our own technologies and offerings in these areas, we continue to evaluate targets within our M&A pipeline where we see the opportunity to accelerate our growth and create long-term value for our shareholders. We are excited about the opportunities in front of us and believe they will drive continued growth for Hillenbrand well into the future. Our next strategic pillar is to manage Batesville for cash. As we continue to grow our industrial product platforms, Batesville is becoming a smaller part of the portfolio, now comprising only about 20% of company revenues. Batesville continues to be a well-run business that generates stable and predictable cash flows to support our profitable growth strategies. Our third strategic pillar is to build a scalable foundation for growth using the Hillenbrand operating model. The integration of Millicron has been a great success, not only in the synergies we've realized to date, but also in improving the way we run the business through the deployment of the Hillenbrand operating model. The foundation established through this integration is a critical success factor in helping us navigate this difficult operating environment and we believe it will accelerate our ability to create value from future acquisitions. As we continue to utilize the tools and expand the capabilities of the HOM, we expect to drive further efficiencies throughout the enterprise, while also enhancing our tools to support future growth, specifically around innovation, digitization, and commercial excellence. Our fourth and final pillar is to effectively deploy strong free cash flow. Hill & Brand has a proven track record of generating cash and deploying that cash in a disciplined manner to deliver long-term shareholder value. We are confident in our ability to continue to generate robust free cash flow, maintain a strong balance sheet, and grow our industrial platforms through organic investments and strategic acquisitions, while also returning capital to our shareholders. In December, we announced a new $300 million share repurchase program extending our commitment to deploy cash in a manner we believe will create long-term value for our shareholders. Before I turn the call over to Christina to cover our financial results, I want to provide an update on our sustainability journey, as well as a recent addition to our executive leadership team. In our most recent sustainability report, we acknowledge the critical importance of understanding our impact on climate change, as this is a key area of focus for us and for our stakeholders. As mentioned in the report, we engaged a consultant to help accelerate our data collection and reporting efforts around energy and emissions. This work has been going very well, and we plan to disclose Scope 1 and Scope 2 emissions, as well as energy usage for our major sites in our next sustainability report, which we expect to publish in the second half of our fiscal year. I look forward to continuing to share our progress with you as we move forward. Finally, last month, we welcomed Anisha Arora as our Chief Human Resources Officer. Anisha brings nearly two decades of experience to Helen Brandt after serving in many different HR leadership roles at Honeywell International. As we face a challenging and competitive labor market with evolving workforce dynamics, I am thrilled to have Anisha on board to drive our HR strategy, including our ongoing commitment to retain, develop, and attract the best talent around the world. With that, I'll now turn the call over to Christina to provide details on our overall financial performance, segment performance, and outlook.