MSA Safety Incorporated

Good day and welcome to the MSA Q2 2022 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your touchtone phone. 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 Chris Hepler. Please go ahead.

Thank you, Chad. Good morning, and welcome to MSA's second quarter 2022 conference call. This is Chris Hepler, Executive Director of Corporate Development and Investor Relations. I'm here with Nish Vartanian, Chairman, President, and CEO, and Ken Krause, Senior Vice President, CFO, and Treasurer. Before we begin, I'd like to remind everyone that matters discussed during this call may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, all projections and anticipated levels of future performance. Forward-looking statements include a number of risks, uncertainties, and other factors that may cause our actual results to differ materially from those discussed today. These risks, uncertainties, and other factors are detailed in our SEC filings. MSA undertakes no duty to publicly update any forward-looking statements made on this call, except as required by law. We have included certain non-GAAP financial measures as part of our discussion this morning, and the non-GAAP reconciliations, as well as our second quarter press release, are available on our investor relations website at investors.msasafety.com. Moving on to today's agenda, Nish will discuss key highlights of the quarter and then turn the call over to Ken to discuss our financial performance. Nish will then provide closing remarks. Following our prepared remarks, we will open the call for questions. With that, I'll turn the call over to Nish.

Thank you, Chris, and good morning, everyone. Before getting into the details of the quarter, I'll start today's call by sharing some information that has all of us at MSA very excited. Within the past several weeks, we were able to finalize significant breathing apparatus contracts with two of the most recognized fire departments in the world. As you may have read in our recent press release, the Los Angeles County Fire Department has selected the G1 SCBA as its new respiratory protection system. Then, following up that exciting news, we learned that the London Fire Brigade selected the MSA M1 SCBA as its new breathing apparatus of choice. You can find more information on that contract in our press release issued Tuesday. Today, the MSA brand is a global leader in the firefighter safety market, and we're grateful for the trust that LA County and the London Fire Brigade continue to place in us. Both wins are excellent examples of cross-selling to existing customers who already know MSA from fire protective clothing and helmets. And as you know, a key element of our strategy is to protect the firefighter from head to toe. Through a combination of product development initiatives and inorganic investments in well-established brands like Globe and Bristol, our team continues to advance that strategy. When we look at our business more broadly, overall demand continued to be very strong in the quarter across most all of our core products and markets. Orders were up 15%. in a quarter on a constant currency basis and 10% organically. Book-to-bill continued to trend well above one time again this quarter, and in July, we continue to see good growth in orders over the prior year. Our quarterly revenue, which continues to be restrained by supply chain issues, was $373 million, up 9% from a year ago on a reported basis and 12% on a constant currency basis. Currency translation was a 3% headwind in the quarter. Ken will discuss this in more detail in his remarks. Backlog at quarter end was again at a record level of over $400 million as a result of strong demand and ongoing supply chain issues. Backlog has increased steadily over the past year and a half and is up across all product categories. Supply chain and inflation continue to be factors, and we expect this to persist in the near term. As anticipated, supply chain issues were most pronounced in electronic components in our gas detection business. Our teams are working on a number of initiatives to address these challenges. We continue to build supply chain resiliency, especially for electronic components by engineering redesigns to increase flexibility for high-risk components, as well as qualifying alternative components and suppliers. And we're using more technology to get better visibility to future availability of components. We're also considering greater insourcing for certain key components, and we're consciously building select inventory to serve our customers in high demand areas. As we see it, building inventory is a good use of our strong balance sheet in this challenging environment to ensure we can respond to our customers' expectations. All things considered, I remain very optimistic around the fundamentals of our business and the durability of customer demand for MSA products and solutions. Shifting gears a bit in June, we published our annual Corporate Social Responsibility Report. As I've said on many occasions, corporate social responsibility is at the heart of what we do at MSA. Our mission is to keep the world's workers safe each and every day so they may return home safe to their families. As I reflect on our progress, I'm energized about both our vision for the future of worker safety and the next steps in our CSR journey. We continue to make investments in products, services, and connected worker solutions that reimagine the next generation of worker safety. We also continue to enhance our programs around environmental sustainability and talent, as well as various risk reduction programs such as the supply chain resiliency programs I just talked about. We do this because at MSA, we know these are the kind of investments that help us to build a better business model in these times. Our people continue to bring passion for our mission, which inspires us to design, develop, and manufacture the world's best safety solutions that protect people who put their trust in the MSA brand. So while I'm very pleased with our results this quarter, our journey continues to make our company, our associates, and our customers fit for the future. With that, I'll now turn the call over to Ken for his comments. Ken?