Enpro Inc.

And welcome to the NPRO Q2 2021 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, James Gentile, Vice President of Investor Relations. Please go ahead.

Thank you, Brock. Good morning, and welcome to Enpro's second quarter earnings conference call. I'll remind you that our call is being webcast at EnproIndustries.com, where you can find the presentation that accompanies this call. With me today is Eric Valencourt, our Interim President and CEO, and Milt Childress, Executive Vice President and CFO. Before we begin today's discussion, a friendly reminder that we will be making statements on this call that are not historical facts and that are considered forward-looking in nature. These statements involve a number of risks and uncertainties, including the impacts from the COVID-19 pandemic and related governmental responses and their impact on the general economy, as well as other risks and uncertainties that are described in our filings with the SEC, included including our most recent Form 10-K and Form 10-Q. Also during the call, we will reference a number of non-GAAP financial measures. Tables reconciling historical non-GAAP measures to the comparable GAAP measures are included in the appendix to the presentation materials. We do not undertake any obligation to update these forward-looking statements. Also during this call, we will be providing full year guidance which excludes changes in the number of shares outstanding, impacts from future acquisitions, dispositions, and related transaction costs, restructuring costs, raw material availability and pricing, and other costs subsequent to the end of the second quarter. The impact of foreign exchange rate changes subsequent to the end of the second quarter, impacts from further spread of COVID-19 and other variants, and environmental and litigation charges. It is my pleasure to turn the call over to Eric Valancourt.

Eric? Thanks, James, and good morning, everyone. We appreciate you joining us today and hope you and your families are all staying healthy and safe. You have likely seen the management transition press release we issued this morning. I want to begin by saying how honored I am that the Board of Directors has placed their trust in me to lead ENPRO as interim president and CEO I also want to recognize Marvin for his contribution to ENPRO over the last several years. On behalf of the board and management team, I wish him the best in his future endeavors. By the way of background, for those who may be unfamiliar, I have been with ENPRO for the better part of 12 years, and over that time have had the opportunity to work in a variety of leadership positions across our Ceiling Technologies segment. I most recently served as president of Ceiling Technologies, a segment which I'm proud to say delivered an exceptional quarter. I also have had the pleasure to serve as a member of the NPRO Executive Council, which is a team of leaders from across NPRO focused on developing and implementing our commercial, strategic, financial, and operational objectives. Serving in these positions has given me the opportunity to experience firsthand what is truly so special about this organization, our collaboration and focus on empowering our colleagues. I know as well as anyone that the success of our organization is built on the hard work dedication, and tireless execution and commitment of our 4,400 employees around the world. As we will discuss throughout today's call, our team has continued to deliver for each other, our customers, and our shareholders in the second quarter, and I know I speak for the entire leadership team when I say I am incredibly proud of what we have accomplished. My goal is to continue to work with our leadership team to encourage and position our employees to unleash their full potential as we continue the clear strategy articulated over the past year. We are excited about what is ahead. With that introduction, let's move on to our second quarter highlights. As I noted, and as our results show, we had another exceptional quarter. In the second quarter, sales of $298.6 million increased 20.9% year over year, with organic sales increasing 27.1%. We saw sequential growth of 6.9% from the prior quarter. Our strong top-line results were driven by organic revenue growth and the addition of Alexa. Importantly, our growth was broad-based, as we experienced positive momentum across all of our businesses. Our second quarter adjusted EBITDA of $57.2 million increased 52.5% year-over-year, and the adjusted EBITDA margin expanded 400 basis points to 19.2%. This strong performance reflects the sustainable benefits of our portfolio reshaping actions, operating leverage and pricing strategies, partially offset by higher incentive compensation accruals and raw material inflation. All three business segments contributed to our adjusted EBITDA growth year over year. Thanks to the focused execution of our team, we were able to secure key materials while holding supply chain disruptions to a minimum. In the past year, we took action to increase the level of collaboration between supply chain, manufacturing, and our commercial teams. This enhanced focus and coordination throughout our organization has helped us improve customer engagement and respond quickly to mitigate raw material issues. Nevertheless, the raw material environment remains highly dynamic due to pandemic-related impacts, and we expect these conditions will likely persist at least through year end. Our order trends in the quarter were extremely strong. surpassing our solid first quarter, and are at the highest level in three years. As we look ahead, we continue to see broad-based strength across our businesses and are encouraged by what we are hearing from our customers, particularly in the general industrial, semiconductor, heavy-duty truck, food and pharma, automotive, and petrochemical markets. Together, these factors played a role in our decision to raise our full-year guidance, which Milt will touch on in his presentations. Now I will hand the call over to Milt for a deeper dive into our financial results for the quarter.