Helios Technologies, Inc.

Ladies and gentlemen, greetings and welcome to the Helios Technologies fourth quarter 2022 earnings conference call. At this time, all participant lines are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce you to Tanya Allman, Vice President of Investor Relations and Corporate Communications. Please go ahead.

Thank you, Operator, and good day, everyone. Welcome to the Helios Technologies Fourth Quarter and Full Year 2022 Financial Results Conference Call. We issued a press release announcing our results yesterday afternoon. If you do not have that release, it is available on our website at hlio.com. You will also find slides there that will accompany our conversation today. On the line with me are Joseph Matasevich, our President and Chief Executive Officer, and Tricia Fulton, our Executive Vice President and Chief Financial Officer. They will spend the next several minutes reviewing our fourth quarter results, discussing our progress with our augmented strategy, providing our outlook for 2023, and then we will open the call to your questions. If you turn to slide 2, you will find our Safe Harbor Statement. As you may be aware, we will make some forward-looking statements during this presentation and the Q&A session. These statements apply to future events that are subject to risks and uncertainties, as well as other factors that could cause actual results to differ materially from where we are today. These risks and uncertainties and other factors will be provided in our upcoming 10-K to be filed with the Securities and Exchange Commission. You can find these documents on our website or at sec.gov. I'll also point out that during today's call, we will discuss some non-GAAP financial measures, which we believe are useful in evaluating our performance. 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 comparable GAAP with non-GAAP measures in the tables that accompany today's slides. Please reference slide 3 now. With that, it's my pleasure to turn the call over to Joseph.

Tanya, thank you, and good day, everyone. Last quarter, I stated our top priority is protecting the business our margins, and cash flow. Even in this challenging environment, the Helios team delivered the game. I would like to briefly recap our strategy. As an organization, we are tirelessly dedicated to our customers and critically focused on innovation leadership. We utilize our Helios business system to guide our strategies and tactics. This enables us to capitalize on our unique position as a pure-play hydraulics and electronics provider. We made great strides this year on our transformation from a holding company to an integrated operating company with a long runway ahead of us. I am very grateful for how hard our global teams worked this year navigating non-stop challenges. It is a true testament to the amazing people we have in the Helios family and the core values we share. This has been an important year for Helios as we integrated and closed on flywheel acquisitions, advanced our technologies, and announced the plans for new centers of excellence to best service our customers through leveraging a world-class manufacturing and operating approach. Our team executed on our augmented strategy and protected our business. We thought and acted globally while diversifying our markets and revenue base. Most importantly, we continue to build and develop the talent that makes up our global workforce. We deliver top-tier margin with solid earnings for the full year of 2022 while navigating supply chain challenges, FX impact, and the ongoing softness in our health and wellness business in the fourth quarter. We continue to build on our financial strength with our Q4 free cash flow up 20% versus prior year. Our balance sheet remains very flexible so we can be opportunistic on additional flywheel acquisition. In 2023, we expect to build upon the progress we have made this year. We will stay focused on what we can control and keep innovating, maintaining our top-tier lead times, and execute our manufacturing and operating strategy. To that end, we announced we are creating two operational centers of excellence in North America for hydraulics. We also just announced the opening of our automated warehouse in Italy at FASTER. With these moves, we expect to drive greater operational efficiencies, quality control, and enable technology enhancements that create advanced hydraulic solutions for our customers. We recently closed another great flywheel acquisition, Schultes Precision Manufacturing, that brings additional customers and capabilities. Combined with our organic growth, entertainment acquisition, we expect to reach our 1 billion revenue milestone with top-tier margins on a run rate basis ending 2023. not including any additional acquisitions this year. Through our organic and acquired innovations, we are creating a pure-play hydraulics and electronics business that will be incredibly tough for our competition to follow. Now turning to slide four. As I mentioned, the shortest acquisitions further diversifies our end markets in the hydraulics, aerospace, communication, food service, medical device, and dental industries. Schultes is a highly trusted specialist in CNC machining, prototyping, and engineering assembly. It matches well with our flywheel acquisition strategy and brings a newly expanded 110,000 square foot facility. The company is in Buffalo Grove, Illinois. in close proximity to Damon Products, our future hydraulic manifold solutions center of excellence. Schultes has a long history and strong reputation for producing high-quality, precision machining components for demanding customers. They have an exceptional value-added manufacturing process, with approximately $30 million in full-year revenue in 2022 and a healthy margin profile The acquisition is immediately accretive. Now turning to slide five. This past year, we as a global company were recognized by several third party organizations. We were named one of the America's best midsize companies by Forbes in 2022. FASTA won the systems and components trophy, engineer's choice for its innovative FASTA ABC electronic hydraulic hose coupling. Son was named a 2022 Florida Manufacturing Employer of Choice. Innovation Controls for the third year in a row was named one of the best workplaces in manufacturing and production in 2022, ranking number two on the list this time. We are extremely proud of these notable recognitions and there are just a few highlights of the many great things our people and companies are accomplishing every single day. Having a highly engaged and productive workforce is critical to driving success for any organization. We believe our strength here will enable us to compete for top talent, minimize risk, and ultimately keep winning in the marketplace. Now let me turn the call over to Tricia to review the financial results and discuss our outlook. She will then hand it back to me for a few final comments. Risha, please.