Methode Electronics, Inc.

Good day, ladies and gentlemen, and welcome to the Method Electronics first quarter fiscal 2022 results conference call. All lines have been placed on a listen-only mode and the floor will be open for questions and comments following the presentation. If you should require assistance throughout the conference, please press star zero on your telephone keypad to reach a live operator. At this time, it is my pleasure to turn the floor over to your host, Robert Cherry, Vice President of Investor Relations. Sir, the floor is yours.

Thank you, Operator. Good morning, and welcome to Metho Electronics Fiscal 2022 First Quarter Earnings Conference Call. For this call, we have prepared a presentation entitled Fiscal 2022 First Quarter Financial Results, which can be viewed on the webcast of this call or found at metho.com on the investors page. This conference call contains certain forward-looking statements, which reflect management's expectations regarding future events and operating performance, and speak only as of the date hereof. These forward-looking statements are subject to the safe harbor protection provided under the securities laws. Method undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in Method's expectations on a quarterly basis or otherwise. The forward-looking statements in this conference call involve a number of risks and uncertainties. The factors that could cause actual results to differ materially from our expectations are detailed in methods filings with the Securities and Exchange Commission, such as our 10-K and 10-Q reports. At this time, I'd like to turn the call over to Mr. Don Duda, President and Chief Executive Officer.

Thank you, Rob, and good morning, everyone. Thank you for joining us for a fiscal 2022 first quarter earnings conference call. I'm joined today by Ron Zumis, our chief financial officer. Both Ron and I have opening comments, and then we will take your questions. Let's begin with the business highlights on slide four. Our sales for the quarter were $288 million. Excluding favorable currency translation, our organic growth was up 45% from the prior year. However, it should be noted that our prior year first quarter was significantly impacted by the pandemic. In this year's first quarter, our team faced customer demand fluctuations and supply chain challenges. These included the ongoing semiconductor chip shortage, pandemic-related supply chain disruptions, and port congestion, all of which created both sales and margin pressure. Once again, our team worked diligently to mitigate many of these challenges, and we were able to deliver results within our guidance ranges for the quarter. However, these demand fluctuations and supply chain disruptions continue to require remedial actions such as expedited shipping and premium component pricing. As of today, our expectation is that these conditions will last at least until the end of the calendar year. While we have reaffirmed our guidance for the full year, Persistent headwinds could cause our performance to be below the midpoint of the ranges as the situation is very fluid and will remain very challenging. The sales growth that we realized in the first quarter was due to increased demand across most of our businesses, but it was especially focused in the auto and commercial vehicle markets. We also realized growth in our DeBeer business. However, that business is still being hampered by the pandemic, thus limiting our production or product evaluation opportunities in hospital operating rooms and ICUs. On an order basis, we had solid awards for EV, cloud computing, and e-bike applications. Focusing on EV, last quarter, we reported that sales into EV applications were 13% of consolidated sales. This quarter, EV sales were 16% of consolidated sales, and we continue to expect that number to be in the meetings for fiscal 2022. Method's combination of user interface, LED lighting, and power distribution solutions is a winning formula in EV. We are especially seeing growth in our power offerings, where we leverage over 40 years of expertise to supply bus bars, connectors, and battery disconnect units to the EV OEMs. In the quarter, we further reduced debt, generated positive operating cash flow, and continued to return capital to our shareholders. We have ample liquidity, which also allows us to execute our stock buyback program, under which we purchased $7.6 million of shares in the quarter, and to pay our dividend, which rose from 11 cents to 14 cents per share in the quarter. We continue to allocate capital per our balanced approach. Moving to slide five, Methyl had another solid quarter of business awards. These awards continue to capitalize on key market trends like vehicle electrification, and cloud computing. The awards identified here represent some of the key business wins in the quarter and represent over $30 million in annual business at full production. In vehicle electrification, we won awards for power distribution and LED lighting programs. We continue to win programs with OEMs globally in both auto and commercial vehicle applications. In non-EV automotive, We were awarded programs for power, lighting, and traditional switch applications. In cloud computing, we saw demand for our power distribution and transceiver products and data center applications. Lastly, we continue to participate in the growth of e-bikes, which utilizes our proprietary magneto-elastic sensor technology. Building on the prior year, our business awards are delivering on our strategic priority to drive both customer and geographic diversity. Turning to slide six, as I've mentioned in recent quarters, our business awards over the last couple of years have put us on track in aggregate to replace the sales from the roll off of our largest auto program. As such, our customer and program diversity continues to improve. Our EV as well as our commercial vehicle and cloud computing businesses have helped drive our customer diversification. While GM and Ford have been and are expected to continue to be good customers that have fueled methods of historical growth, in recent years we have strategically and systematically broadened our customer base. Our business outside of GM and Ford grew to two-thirds of our fiscal 2021 total sales. To conclude, despite the ongoing demand fluctuations and supply chain challenges, we are still in a position to deliver strong organic growth for fiscal 2022. At this point, I'll turn the call over to Ron, who will provide more detail on our first quarter financial results. Ron.