Minerals Technologies Inc.

Good day, everyone, and welcome to the third quarter 2024 Minerals Technologies earnings call. Today's call is being recorded. At this time, I would like to turn the call over to Lydia Kapalova, Head of Investor Relations for Minerals Technologies. Please go ahead, Ms. Kapalova.

Thank you, Shelly. Good morning, everyone, and welcome to our third quarter 2024 earnings conference call. Today's call will be led by Chairman and Chief Executive Officer Doug Dichter and Chief Financial Officer Eric Aldag. Following Doug and Eric's prepared remarks, we'll open it up to questions. As a reminder, some of the statements made during this call may constitute forward-looking statements within the meaning of the federal securities laws. Please note the cautionary language about forward-looking statements contained in our earnings release and on this slide. Our SEC filings disclose certain risks and uncertainties which may cause our actual results to differ materially from this forward-looking statement. It was also noted that some of our comments today refer to non-GAAP financial measures. A reconciliation to GAAP financial measures can be found in our earnings release and an appendix of this presentation, which are posted on our website. Now I'll turn it over to Doug. Doug?

Thanks, Lydia. Good morning, everyone, and thanks for joining today. Let's go over a quick outline for today's call. First, I'll provide a quick review of our performance highlights for the quarter. And then I want to spend a few minutes reviewing the progress we've made with a variety of key initiatives and business development activities, as well as run through some highlights and key takeaways from our Investor Innovation Day that we held in September. Eric will then take you through the detailed financials for the quarter. We'll try to keep our prepared remarks a bit shorter this call, so we have more time for your questions. Let's start with our Q3 highlights. This is a record third quarter for us, and we're on track for another record year. We did experience a general slowdown across our industrial markets this quarter, primarily in the engineered solutions segment, but this softness was offset by growth in our consumer-based businesses. This is the balanced structure of our portfolio that I often refer to, and it continues to prove that it can deliver solid results through a range of market conditions. Despite the softer conditions in our industrial markets, Operating income was a record for a third quarter, and both gross and operating margins remained strong, reflecting the increased profitability we are driving across the company. Price improvements, higher sales of our newest products, input cost savings, and productivity improvements all contributed to this performance. Operating cash flow increased over last year, and our balance sheet is in great shape. We have broad opportunities to invest capital in ourselves both to support our organic growth and to capture manufacturing cost improvements in our facilities. With debt leverage at our target levels and with our free cash flow generation of around 7% of revenue, we have sufficient financial flexibility. We continue to follow our balanced approach to capital allocation, which is to return 50% of our free cash flow back to shareholders, while retaining the other 50% on the balance sheet for inorganic growth opportunities. We completed our previous $75 million share repurchase program last week, and last week announced a new $200 million share repurchase initiative. We increased the dividend by 10% at the same time, demonstrating the confidence we have in our ongoing financial strength and long-term growth prospects. Overall, I'm proud of our team's performance this quarter and pleased with how well MTI is positioned to continue our strong performance track. We made significant progress over the past several quarters with our growth strategies in both segments, and I'd like to highlight a few initiatives and accomplishments that will have a meaningful impact on expanding our leadership in key markets and positioning the company for the future. In household and personal care, we recently launched a new global B2B brand called SIBO. For the past few years, we've built a leading cat litter business, emerging as the leading partner for both private label and well-known brands. The SIVO identity was established to unify and embody the strength of this global business and its focus on solutions that improve the lives of pet owners and their cats. No other cat litter manufacturer can offer the level of expertise and service that we can through our global mining, processing, packaging, innovation, and logistics. The SIBO business is positioned to offer our customers the very best assortment of products in every region, which we see as an extremely strong base for long-term growth. Within the specialty additives product line, we expanded our offering of products targeting sustainable solutions. We've grown our position in paper and packaging markets this year through the deployment of our new yield recycling technology. And we recently launched a new specialty additive technology for the bioplastic market called M-Force Bio. This additive helps to maintain the plastic's physical properties and functionality, and in certain applications, enables it to be fully compostable. In the engineering solution segment, we continue to deploy our MINSCAN LSC automation technology for refractories, with two additional installations expected in Q4. And we continue to increase the penetration of our foundry blends into the China and India markets with the conversion of several new customers to our blended solution. We've made significant progress with the validation and deployment of Florazorb, our PFAS remediation solution. As you know, we're collaborating closely with the EPA to further demonstrate the effectiveness of Florazorb in drinking water treatment and have been included in pilots at eight water utilities. The results so far are very promising, and we anticipate that this will accelerate the adoption of Florazorb across the U.S. We have other examples of growth initiatives that we've pursued this year, but these are a few that demonstrate how we are aligning the company with secular growth trends, developing new sources of revenue, and positioning the company for future growth. One last comment before I move on. we tend to focus our comments regarding innovation on new product development. We've also made several innovative advancements within our operations and back office processes. At MTI, we constantly look for ways to remove inefficiencies, improve safety, and increase our process capability. Over the past few years, we've deployed several AI-based tools in our operations to aid areas like predictive maintenance, and process optimization. We've also deployed intelligent tools to supplement our shared service business processes and our R&D capabilities. We're beginning to see the benefits from these initiatives, which give us greater insight into lowering manufacturing costs, aiding our R&D activities, and becoming even more efficient in both manufacturing and business processes. One significant recent example is a partnership we just announced with a technology company to deploy autonomous mining capabilities. We've been working together to refine this technology for the past two years. We see where this can help us to increase employee safety, improve productivity, and drive higher utilization of our mining equipment. I mention all of this to highlight that innovation at MTI is deeper than just new product development. It's one of the core tenets of our operational excellence culture and is driving improvements and efficiencies across the company. Speaking of innovation, on September 24th, we hosted investors at our Innovation Day event at our Hoffman Estates R&D Center. And for those of you who attended, thank you for taking the time to join the event. The day focused on three of our four core technologies and primarily around how we apply them in our Bentonite-based businesses. We showcased how we apply these technologies in the development of some of our latest products in environmental water remediation, health and beauty, high temperature foundry systems, and pet care. But the day was not intended to just demonstrate our products. It was to highlight the depth of our technological capabilities, their versatility, and how they can be applied to create solutions for a wide variety of problems. An additional point we were trying to convey during the day was to show that these technological capabilities, important as they are, are only one piece of what makes MTI unique. We demonstrated four key characteristics of MTI, describing our world-class mineral reserves, these core technologies, our deep applications expertise, and our intimate knowledge of our customers' products and processes. The combination of these four and how they are supported by the MTI business system and our culture of operational excellence is what truly differentiates MTI. It's this architecture that supports our leadership in the marketplace and what positions us to be able to develop, manufacture, and deliver valuable products and solutions over the long term. If you weren't able to attend this event, I would encourage you to access the presentation materials on our website. and we look forward to showcasing our other technologies and minerals at another Innovation Day in the future. Now I'll hand it over to Eric, who will walk us through the financial details, segment highlights, and our outlook for Q4.