Luxfer Holdings PLC

Good morning. My name is Katie, and I will be your conference operator today. Welcome to the Luxfer first quarter 2022 earnings conference call. All lines have been muted. After the speaker's prepared remarks, we will hold a question and answer session. Now I will turn the call over to Mike Gaydon, Vice President of Investor Relations from Luxfer. Mike, please go ahead.

Thank you, Katie. Welcome, everyone. to Luxfer's first quarter 2022 earnings call. With me today is Alok Mascara, Luxfer's chief executive officer, Andy Butcher, Luxfer's chief executive officer designate, and Steve Webster, Luxfer's chief financial officer. On today's call, we will provide details of our first quarter 2022 performance as detailed in the press release issued yesterday. Today's webcast is accompanied by a presentation that can be accessed at luxfer.com. Please note, any references to non-GAAP financials are reconciled in the appendix of the presentation. Before we begin, a friendly reminder that any forward-looking statements made about the company's expected financial results are subject to future risks and uncertainties. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise. Please refer to the Safe Harbor Statements on slide two of today's presentation for further details. Now, I will turn the call over to Alok for his summary comments on the quarter, after which Steve will provide details of our financial results. Following Steve's remarks, Alok will introduce Andy, who will discuss Luxverse Outlook before Q&A. Alok, please go ahead.

Thank you, Mike, and welcome, everyone. Please turn to slide three. I am pleased to share with you today details of our solid execution in the first quarter. I want to start by expressing my thanks to the entire Luxfor team who once again navigated difficult supply chain conditions in the quarter to put our customers first. I also want to express my appreciation to our customers for their collaboration and support amid ongoing labor and material shortages. On this page, I want to highlight three key messages. We delivered 14% year-over-year sales growth in the first quarter, driven by an 8% uplift from the SCI acquisition, as well as our success in passing through cost inflation. While raw material availability impacted our volumes and input cost inflation impacted our profitability, Q1 adjusted diluted EPS of $0.33 places us on a strong footing to start the year. Our Electronics Q1 delivered solid results, helped by robust industrial demand and successful inflation pass-through. While GasCylinder's Q1 results were challenged by inflation and material availability, our 2022 growth expectations for these business units remain unchanged, given the strong demand and order backlog. Our balance sheet remains solid with a net debt to EBITDA ratio of 1.1. Second, we remain focused on meeting high levels of demand by navigating through supply chain constraints. We are generating an elevated pace of order flow across many of our end markets, including industrial and aerospace, and see the potential for rising defense activity. This quarter, we implemented multiple actions to offset inflation in our input cost, and we also advanced our efforts to further diversify our supplier base to increase supply chain resiliency. Consistent with our expectations at the year's onset, we did see some evidence of incremental improvements in the broader supply chain during the quarter. Third, our solid Q1 performance and healthy backlog have enabled us to improve our 2022 adjusted diluted EPS guidance range to a range of $1.35 to $1.50 from the earlier range of $1.30 to $1.50. In addition, our Q1 results and outlook for the balance of the year underscore our confidence in delivering on our EPS goal of $2 or more by 2025. Turning to slide four, I would like to provide more details on our supply chain recovery efforts. Luxfer, like many other manufacturers, continues to navigate strenuous supply chain conditions as outlined during our Q4 earnings call in February. The ongoing force majeure at U.S. magnesium continues to limit availability of magnesium in U.S., and at the same time, supplies of carbon fiber, zircon sand, and other key raw materials also remain tight. However, we are making progress, both internally and externally, to address these unprecedented conditions. We continue to qualify alternate suppliers for key raw materials like magnesium, zircon sand, and carbon fiber. Success from our efforts to secure timely and cost-effective procurement gives us greater confidence in delivering on our 2022 financial forecast. In March, the Rio Tinto Richards Pay Mine, our primary supplier of zircon sand, lifted its force majeure, consistent with our expectations for incremental supply chain improvement as the current year progresses. These tight supply chain conditions persist against the backdrop of sustained high level of demand from our customers. Current oil pricing conditions underscore the value proposition of our products serving the transportation and energy applications. The geopolitical backdrop also brings the potential for heightened demand for our military and humanitarian relief offerings. We stand prepared to deliver any additional needs for U.S. or NATO troops with countermeasure flares, flameless ration heaters, and other defense products to support efforts towards reinforcing security in the European region. We also remain ready to supply additional orders for MREs and humanitarian relief products to support those impacted by the devastating war in Ukraine. We continue to collaborate with our customers to proactively manage our elevated backlog. Our customer-first approach, along with our ability to secure additional inventory supply, positions as well to capture additional growth amid this busy and demanding economic backdrop. Now, let me turn the call over to Steve for details on our first quarter financial performance.