Kennametal Inc.

Good morning. I would like to welcome everyone to Kenna Metal fourth quarter and fiscal 2026 earnings conference call. All lines have been placed on mute to prevent 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, please simply press the star, then the number one on your telephone keypad. If you would like to withdraw your question, please press the star, then the number two. Please note that this event is being recorded. I would now like to turn the conference over to Michael Pici. Vice President of Investor Relations. Please go ahead, sir.

Thank you, operator. Welcome, everyone, and thank you for joining us to review Kenna Metals' fourth quarter and fiscal 2026 results. This morning, we issued our earnings press release and posted our presentation slides on our website. We will be referring to that slide deck throughout today's call. I'm Michael Pici, Vice President of Investor Relations. Joining me on the call today are Sanjay Chowbey, President and Chief Executive Officer, and Pat Watson, Vice President and Chief Financial Officer. After Sanjay and Pat's prepared remarks, we will open the line for questions. At this time, I'd like to direct your attention to our forward-looking disclosure statement. Today's discussion contains comments that constitute forward-looking statements and as such involve a number of assumptions, risks and uncertainties that could cause the company's actual results, performance or achievements to differ materially from those expressed in or implied by such statements. These risk factors and uncertainties are detailed in Kenna Metals SEC filings. In addition, we will be discussing non-GAAP financial measures on the call today. Reconciliations to GAAP financial measures that we believe are most directly comparable can be found on the back of the slide deck and on our form 8K on our website. And with that, I'll turn the call over to Sanjay.

Thank you, Mike. Good morning, and thank you for joining us. I will begin the call today with a brief review of the fiscal year. followed by an aerospace product spotlight and some end market commentary supporting our fiscal 27 outlook. Then Pat will cover the quarterly financial results as well as the fiscal 27 outlook. Finally, I'll make summary comments and then open the line for questions. Beginning on slide three for an overview of our strong fiscal year results. Throughout fiscal 26, we continue to win new business and expand our share of wallet with key customers across diverse end markets like aerospace and defense, energy, transportation, and earthworks. Our success reflects the strength of our core competencies, which includes material science and process technology, application engineering, and a secure global supply chain. This combination of expertise, innovation, and global operations is a strong competitive advantage for us. For the last several years, we have used a systematic approach to our growth initiatives which includes identifying the most attractive opportunities and allocating the resources needed to capitalize on them. An important aspect of this approach is that it is repeatable and sustainable. I will cover an aerospace and defense example of this in a moment. We broadened our growth platforms this year through wins tied to AI-powered data centers, defense programs, mining projects, and next-generation vehicle power trains. At the same time, we also advanced new digital machining solutions that enhance customer productivity. In addition to the growth we saw from our own strategic initiatives, we experienced improvements in several of our end markets. The key external market factors we track all have improved, including IPI, PMI, light vehicle production and aircraft build rates. At the same time, rig counts stabilized during the year. The final component of sales growth is price, driven by higher tungsten costs. Tungsten outside of China has now stabilized but remains at historically high levels. We implemented several pricing actions in response to this environment. As you have heard us say previously, we are committed to offsetting the impact that this additional cost is having on the business. Finally, we realized $27 million in restructuring savings this year and remain committed to $110 million of savings by the end of fiscal 27. Now let's move to our full year results. Full year organic sales increased 19% year over year, driven by additional price realization and modest volume. From an end market perspective, for fiscal 26, all end markets experienced growth on a constant currency basis. For the full year, adjusted EPS increased to $4.57 compared to $1.34 in the prior year. Adjusted EBITDA margin was 26.9% compared to 15.2% in the prior year. As expected, free cash flow was adversely impacted by increased working capital requirements related to tungsten prices. Cash flow from operating activities was negative $4 million, and free operating cash flow was negative $79 million. And finally, we returned $71 million to shareholders. 61 million dollars through dividends and 10 million dollars through share repurchases. More details on our full year performance can be found on slide 18 in the appendix. Pat will provide a detailed overview on the fourth quarter results in his prepared remarks. In summary, we are pleased with the way the team executed this year on growth, lean transformation, and cost-out initiatives while also navigating this unique and unprecedented business environment. Now, before I provide an update on in-market, I want to call your attention to slide four. This highlights our metal cutting solution to address machining challenges aerospace customers have with carbon fiber reinforced plastics or CFRP. This is one of the most exciting growth stories in our portfolio. CFRP is an extremely strong, rigid, and lightweight composite material that is difficult to machine. Due to its high strength to weight ratio, it is widely used in aerospace and automotive manufacturing, where fuel efficiency is a key focus. We are competing in a roughly $500 million market for cutting tools used on carbon fiber composites in aerospace. This market is expected to grow 9% a year through 2028. One of the fastest growing material groups we serve. Aerospace demand for lightweight composites remains strong. What makes this market especially attractive is the economics. Consumption for diamond coating cutting tools for CFRP is almost double that of cutting tools for aluminum. These can't be easily reconditioned. Once they are consumed, customers come back for a replacement. That provides us a durable recurring revenue base. How we win here is again tied to our core competencies as we are leveraging our engineering and materials science expertise. We design innovative solutions using standard and custom tooling with proprietary geometry and material science. These deliver longer tool life and cleaner cuts. We pair that product advantage with deep channel relationships and a well-trained sales and application engineering team. This expands our reach and helps customers solve their manufacturing challenges. Let me give you an example. A customer recently faced a supply disruption from a competitor, so our team quickly stepped in, delivered a superior product in guaranteed supply, and we won that business outright. This is only one example of growth opportunities driving performance in aerospace. Since composites are also used in applications across the transportation and general engineering end markets, we are excited about the prospects of leveraging our expertise to serve this growing application. We will apply the same disciplined, repeatable process I discussed earlier to this growth opportunity. This process helps us identify the most attractive opportunities, move resources quickly, and drive growth and share gains while leveraging our global supply chain to deliver innovative solutions on time and to specification. Turning to slide five, I want to frame the in-market demand environment supporting our full-year fiscal 27 outlook. As a reminder, our full year outlook reflects forecasts of specific market drivers and general market conditions. The top half of this slide reflects our sales outlook at the midpoint and includes price, volume, and market factors. I will focus on the bottom half of the slide and the market conditions by end market. Aerospace and defense remains the structural growth engine. On the aerospace side, commercial OEM bill rates continue to recover as supply chains normalize and production restrictions ease. In defense, we're seeing a proposed increase in the U.S. budget, coupled with NATO members planning to significantly raise spending. This provides a durable multi-year demand trajectory. Aerospace and defense also continues as a strategic growth initiative for us. You might remember at our last investor day, we talked about shifting resources from transportation to aerospace and defense in the Americas to grow our position in that market. That helped us drive share gains and new opportunities like the one I mentioned a few minutes ago. Coupled with key wins on various defense opportunities, aerospace and defense is now projected to be our third largest end market. General engineering is a stable. U.S. and European industrial production are both forecast up low single digits, and China has returned to modest expansion. Energy growth is anticipated to be strong. The U.S. land-based rig count has turned decisively. Prior estimates were a mid-single digit decline. Projections now forecast rig counts up high single digits. Customer sentiment has moved from cautious to improving. and combined with increased rig counts supports a meaningful upward revision to this end market assumption. The trend in the market for AI data center power generation continues to experience rapid expansion, which provides further support for growth in this end market. Now there are some offsets we are monitoring. Transportation continues to be soft. Global light vehicle production moved from up about a point in fiscal 26 to down about a point in fiscal 27, mainly in the Americas and Europe. In earthworks, mining share gains are partially offset by soft core markets in the U.S. and China, though customers there are increasingly consolidating towards reliable suppliers like us. And in road construction, we are assuming that normal seasonality and competitive pressures continue. Netting it out, our fiscal 27 sales assumptions in constant currency and including price reflect broad-based growth across most end markets. We are confident that this market recovery is broad enough and the pricing environment firm enough to support our outlook and growth trajectory into fiscal 27. Now, let me turn the call over to Pat, who will review the fourth quarter financial performance.