Janus International Group, Inc.

Good morning and welcome to the Janus International Second Quarter 2024 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Sarah Macioc, Senior Director of Investor Relations. Please go ahead.

Thank you, Operator, and thank you all for joining our earnings conference call. I am joined today by our Chief Executive Officer, Ramey Jackson, and our Chief Financial Officer, Ansem Wong. We hope that you have seen our earnings release issued this morning. We have also posted a presentation in support of this call, which can be found in the investor section of our website at janiceintl.com. Before we begin, I would like to remind you that today's call may include forward-looking statements. Any statements made describing our beliefs, goals, plans, strategies, expectations, projections, forecasts, and assumptions are forward-looking statements. The company's actual results may differ from those anticipated by such forward-looking statements for a variety of reasons, many of which are beyond our control. Please see our recent filings with the Securities and Exchange Commission, which identify the principal risks and uncertainties that could affect our business, prospects, and future results. We assume no obligation to update publicly any forward-looking statements, and any forward-looking statements made by us during this call is based only on information currently available to us and speaks only as of the date when it is made. In addition, we will be discussing or providing certain non-GAAP financial measures today, including adjusted EBITDA, adjusted EBITDA margin, adjusted net income, and adjusted EPS. Please see our release and filings for a reconciliation of these non-GAAP measures to their most directly comparable GAAP measure. On today's call, Ramey will provide an overview of our business. Ansem will continue with the discussion of our financial results and 2024 guidance before Ramey shares some closing thoughts and we open up the call for your questions. At this point, I will turn the call over to Ramey.

Thank you, Sarah. Good morning, everyone, and thank you for joining us. As I go through my prepared remarks, I'd like you to focus on some key themes. First, Janice is demonstrating resilience during a dynamic time in our end markets. Second, looking beyond the current headwinds, we believe the long-term fundamentals in each of our sales channels remain intact. And finally, our financial results, balance sheet strength, and reliable cash generation reflect the durability of our business model and continued strong execution by our team. During the second quarter, we encountered more cautious environment in our end markets as a number of factors combined to impact demand from our customers. Concerns around higher for longer interest rate environment resulted in some temporary deferrals of projects until the outlook is clear. Self-storage is a long-term business and our customers are continuing to invest in the long-term future of their assets while keeping a watchful eye on broader market trends. We bolstered our offerings in the commercial market during the quarter through organic investment and M&A in an exciting adjacent category. Working with our customers to better align our structure with their needs, during the quarter, we opened a distribution center in Mount Airy, North Carolina, allowing us to stock on-site and fill orders in a timelier fashion. We expect to see benefits from this beginning in the third quarter. On the M&A front, in May, we acquired Terminal Maintenance and Construction, or TMC, a premier provider of terminal maintenance services for LTL freight industry in the southeastern United States. TMC will focus on commercial customers, where they provide trucking terminal renovation, remodeling, and maintenance services. Over time, we expect to unlock further value by integrating their capabilities to support growth of our facilitate division, which provides complete facility maintenance services for self-storage. The integration of TMC is on track, and we are pleased with the contribution they made during the quarter. On a broader note, Adding capabilities in adjacent categories complements our core sales channels and increases our total addressable market. We believe that our strong track record of delivering on synergy targets and executing smart M&A transactions has positioned us to deliver growth and increases in profitability. Now let me give you some high-level thoughts on our performance in the second quarter. As always, everything we do at Janus is a team effort. and I'd like to thank our employees for the continued hard work, dedication, and professionalism they show every day. We delivered financial results in the second quarter that reflected continued growth in our new construction sales channel that was more than offset by softness in both the R3 and commercial and other sales channels. Those results included continued solid adjusted EBITDA margin performance and a continuation of our robust cash generation despite a decrease in revenue. Our ability to effectively manage our margins speak to the inherent flexibility in our business model. Our balance sheet strength remains a differentiator with net leverage at the end of the second quarter of 1.7 times, down 0.3 turns year over year, and below our stated long-term target range of two to three times. Turning to the performance of our sales channels, which Anson will expand upon shortly, for the second quarter of 2024. Total self-storage revenue was down 6.2% as strength and new construction was more than offset by weakness in R3 compared to the prior year period. This is a continuation of a trend over the last several quarters that has favored investment in self-storage capacity via greenfield sites. As we have discussed previously, there has been a return to normal levels of retail to storage conversion activity as compared to the high watermarks we saw during the pandemic. which was the primary driver of the decline in R3. This quarter, we also saw impacts from tighter lending standards and elevated interest rates, causing operators to delay R3 work until economic conditions improved. Our commercial and other sales channel was down 12.5% in the second quarter compared to the year-ago period. The results reflected general market softness and a continued decline in demand for carports and sheds, which had risen to represent a substantial portion of the sales channel during the pandemic. Despite the year-over-year top-line decline, we're excited about the addition of TMC in the quarter. Our opportunities across the broader commercial space and potential we see to improve margins over time. On a consolidated basis, overall second quarter revenue impacts were driven roughly equally by price and volume. our innovative suite of remote access solutions had another strong quarter, during which we increased the number of installed units to 323,000 from 300,000 at the end of the first quarter, representing a sequential growth of 7.6%. In April, we announced the addition of Nokia ION to our Nokia Smart Entry product lineup. ION, an inside-the-door magnetic hard-wired smart locking system, represents the next step in the expansion of capabilities of Nokia to drive accelerating adoption across our customers' portfolios. Beta testing is underway, and we are already seeing interest from customers. We expect ION to be available for sale at the end of the third quarter with installations and corresponding revenue impacts beginning in the fourth quarter. We continue to innovate our offerings in partnership with customers to better serve their needs. One of these needs is combating theft, which is becoming an important issue for the industry in select markets. In July, we announced the NS series, which includes two new roll-up door solutions engineered to provide a heightened level of safety and security for self-storage facilities. The NS Series incorporates an enhanced design that includes anchored guides to the floor, ensuring stability and durability. A robust lower bar equipped with secure clips that smoothly glide within the guides combines with firmly anchored support angles on the floor to provide elevated strength and support. The NS Series includes the NS Plus Door and the NS Retro Kit. The NS Plus door is ideal for both replacements as well as new construction. The NS Retro Kit is not a door, but a package that can be installed on existing Janus doors. Our combination of strong liquidity and continued robust cash generation put us in a position to be active in our capital allocation activities during the quarter, including an acquisition in an adjacent market, share repurchases, and proactive management of our balance sheet. In summary, despite some challenges, we remain encouraged by the fundamentals that we expect to drive long-term growth for our company. We are focused on things that we can control, safely and reliably delivering services and solutions for our customers. We look forward to working to expand our strong market position and create long-term value for all of our stakeholders in 2024 and beyond. With that, I'll turn the call over to Anselm for a further overview of our results. along with updates to our 2024 guidance. Ansem.