Magna International, Inc.

Greetings and welcome to the first quarter 2021 results conference call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question and answer session. At that time, if you have a question, please press the 1 followed by the 4 on your telephone. If at any time during the conference you need to reach an operator, please press the star 0. As a reminder, this conference is being recorded Thursday, May 6th of 2021. I would now like to turn the conference over to Louis Tonelli, VP of Investor Relations. Please go ahead.

Thanks, Selina. Hello, everyone, and welcome to our first quarter 2021 results conference call. Joining me today are Swami Kodagiri and Vince Galiffi. Yesterday, our board of directors met and approved our financial results for Q1 2021. We issued a press release this morning outlining our results. You'll find the press release, today's conference call webcast, The slide presentations go along with the call and our updated quarterly financial review, all in the investor relations section of our website at magna.com. Before we get started, just as a reminder, the discussion today may contain forward-looking information or forward-looking statements within the meaning of applicable securities legislation. Such statements involve certain risks, assumptions, and uncertainties, which may cause the company's actual or future results and performance to be materially different from those expressed or implied in these statements. please refer to today's press release for a complete description of our safe harbor disclaimer. As we review financial information today, please note that all figures discussed are in U.S. dollars. We've included in the appendix a reconciliation of certain key financial lines for Q1-21 between reported results and results excluding unusual items. Our quarterly earnings discussion today excludes the impact of unusual items into Q1-21. Please also note that when we use the term organic in the context of sales movements, we mean excluding the impact of foreign exchange acquisitions and divestitures. Lastly, we held a virtual investor event on April 13th. For those that were not able to join us for the event, it's archived on our website in the investor relations section. And with that, I'll pass it over to Swami.

Thanks, Luis. And good morning, everyone. To start off, I hope everyone is staying safe and healthy. I am happy to be reporting the results of the first quarter in my role as the CEO. Before I start, I would like to thank the management team and the employees of Magna for their diligence in staying safe and healthy while continuing to operate successfully. I would also like to extend my appreciation to our customers for working collaboratively in navigating the industry supply chain issues. With that, I'm really pleased with our strong Q1 performance, despite ongoing industry supply challenges. It was another solid quarter for our margins, in part as a result of our focus on operational excellence. Longer term, our portfolio positions us to continue driving sales growth over market, as well as strong free cash flow generation, and we remain very excited about Magna's future particularly given our systems and complete vehicle know-how and approach. Before we get into the quarter results, let me reiterate the key points from our investor event last month. To drive growth in both top line and bottom line, we will accelerate our capital deployment towards the megatrend and high growth areas, drive operational excellence to further improve performance, and unlock new business models and markets by leveraging the full breadth of our capabilities. We have recently highlighted some of our activities in the focus areas associated with this strategy. In the area of electrification, we are developing and bringing to market our latest generation of e-mobility products and technologies. These cover a range of powertrain configurations and vehicle segments. We have received significant interest from many OEMs on these new products. In fact, we recently received a program award for our latest eDrive technology for an upcoming battery electric vehicle. Our opportunities in electrification extend beyond the powertrain. We have a strong competitive position in battery enclosures, a product that has significant technology and engineering content, that is needed on every high voltage vehicle. We already have two program awards for this technology, and there is a lot more interest in the pipeline. In the area of autonomy, we have highlighted a program award for a driver monitoring system launching next year. Here, we are combining our experience in both cameras and mirrors to develop fully integrated systems. Lastly, We recently entered a strategic collaboration agreement with RE and eMobility startup to explore future vehicle development opportunities across a variety of use cases and in the area of mobility as a service in the light commercial vehicle market. So lots of exciting things on the go at Magna. Let me turn to some of the market dynamics that are affecting our business right now. with a negative impact of COVID. Particularly in the first half, we are experiencing a recovery in global vehicle demand and a corresponding increase in global auto production. Vehicle segment mix globally has been shifting towards light trucks over the past few years. And this continued this past quarter in both North America and Europe. We have a higher proportion of our sales in truck segments relative to the market in each of these regions. And compared to 2020, a weaker US dollar relative to a number of currencies in which we operate is also creating a tailwind in our reported sales this year. In terms of headwinds, the entire industry is experiencing supply constraints, in particular, a global semiconductor chip shortage. We expect the chip shortage to continue to have an impact throughout the year. Supply issues, particularly in chemicals and resins, are driving higher commodity costs for us in the remainder of the year. And the ongoing pandemic continues to impact the industry, including through stay-at-home orders and other restrictions. COVID remains a risk to the industry through this year. The health and safety of our employees remains our top priority. Overall, we continued our strong performance in Q1, despite some of the operating challenges we faced. Consolidated sales increased to $10.2 billion, reflecting 3% weighted sales growth over market. EBIT margin increased to 7.6%. Our adjusted EPS more than doubled to 1.86. And mainly as a result of our higher earnings, free cash flow increased to over $400 million in this quarter. We also returned $280 million to shareholders and raised our financial outlook for the year. All in all, another good quarter for Magna. With that, I will hand it over to Vince to take you through the specifics. Vince?