Ranpak Holdings Corp.

Thank you for standing by. My name is Edmund, and I will be your conference operator today. At this time, I would like to welcome everyone to the RANPAC second quarter earnings call. All lines have been placed on mute, and to prevent any background noise, after the speaker's remark, there will be a question and answer session. If you would like to ask a question during this time, please simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one. Thank you. Sarah Horvat, General Counselor, you may begin now.

Thank you and good morning everyone. Before we begin, I'd like to remind you that we will discuss forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from these forward-looking statements as a result of various factors, including those discussed in our press release and the risk factors identified in our Form 10-K and our other filings filed with the SEC. Some of the statements and responses to your questions in this conference call may include forward-looking statements that are subject to future events and uncertainties that could cause our actual results to differ materially from these statements. RAMPAC assumes no obligation and does not intend to update any such forward-looking statements. You should not place undue reliance on these forward-looking statements, all of which speak to the company only as of today. The earnings release we issued this morning and the presentation for today's call are posted on the Investor Relations section of our website. A copy of the release has been included in a Form 8-K that we submitted to the SEC before this call. We will also make a replay of this conference call available via webcast on the company website. For financial information that is presented on a non-GAAP basis, we have included reconciliations to the comparable GAAP information. Please refer to the table and slide presentation accompanying today's earnings release. Lastly, we'll be filing our 10Q with the SEC for the period ending June 30th, 2023. The 10Q will be available through the SEC or on the Investor Relations section of our website. With me today, I have Omar Asili, our Chairman and CEO, and Bill Drew, our CFO. Omar will summarize our second quarter results and provide commentary on the operating landscape and Bill will provide additional detail on the financial results before we open up the call for questions. With that, I'll turn the call over to Omar.

Thank you, Sarah, and good morning, everyone. I appreciate you all joining us today. Our overall second quarter financial results demonstrate continued improvement from the start of the year as we see meaningful improvement in our margin profile driven by the more favorable input cost environment and tight spending initiatives. Although volumes were not where we would like them to be at this point, we entered 2023 with the expectations that volume would be subdued in the first half of the year, and our second quarter results reflect that. We spoke on our previous call about the softness to start the quarter. May and June saw improved activity levels with overall demand relatively steady. Generally speaking, consumer spending continues to be impacted by the preference for travel and essentials rather than the purchase of discretionary goods. and many manufacturers are hesitant to invest, given the uncertain outlook across the globe. When we came into the year, we expected the second half to demonstrate the beginning of more normal operating conditions. We are still watching for that to manifest itself in the activity levels, so remain cautious on the volume outlook in the near term, as consumer spend is allocated elsewhere and overall economic conditions are choppy across the globe. Given this backdrop, we're focusing on those things that are under our control to improve our performance. And right now, our top focus is on working the assets we have and converting our pipeline of large strategic accounts to closes. North America sales were down 6% in the quarter versus last year, driven by lower volumes in PPS. Similar to last quarter, I would characterize activity levels in the region as stable, but at a subdued level to start the year. sentiment among manufacturing customers reflects this low environment and i think the recent pmi and ism data reflect this e-commerce activity continues to be hampered by the allocation of consumer funds to restaurants travel groceries and apparel compared to more discretionary purchases of items such as electronics and goods for the home box shipments as well as freight and logistics data reflect companies tightly managing their inventory with sell-through remaining soft and a higher cost of capital flowing through the economy. I would say overall a similar message on the general environment from what you heard from us in Q1, with the difference being the quarter ended on a better note compared to the start. I also mentioned in the first quarter call we are making inroads with key with many key accounts that may have historically been plastic only. These trials and relationships continue to deepen, and the momentum has only gotten better since the last update. I remain optimistic about the shift towards paper from many large organizations in North America. Sales in Europe, Asia Pacific were down 7.6% for the quarter on a constant currency basis, as activity levels in the regions are weighed on by the overall economic environment in Europe, where manufacturing remains in contraction territory and consumer confidence is extremely low due to persistent inflationary pressures. We are through the destocking in Europe that plagued us last year, and I think in some cases customers are overcorrecting on the inventory side, But the overall environment in the region remains constrained, even with energy pricing down more than 80% from the peak. Asia is mixed, but places like Australia, New Zealand, and Japan demonstrate strength in account activity. The volume environment remains inconsistent. January was solid. February was decent. March and April were weaker, followed by a strong May and a decent June. It is hard right now to get certain or generally constructive in the short term on the volume environment of the existing base book of business. But the key account activity we are pursuing does provide for some optimism to be layered in throughout the rest of the year and into 2024, which is positive for us. On another positive note, the margin profile of the business is improving faster than anticipated, with gross margins achieving levels year-to-date that we thought would take all year to achieve. Fortunately, supply chains have meaningfully improved and we are getting more relief on the input cost side of things, which supports expected continued margin improvement throughout 2023 globally. We have seen this year when the volumes are there in the stronger months, the operating leverage is powerful. So I'm confident we are getting back on track. In the immediate term, though, we are not waiting for the macro to turn. We're tightening the focus of the company and executing on those areas that are in our control. We're aggressively managing headcount and new projects to tighten our spend profile. We are prioritizing initiatives that maximize cash flow generation and only pursuing growth projects that move the needle and maximize return. We have made tremendous investments in digital and physical infrastructure as well as new products over the past couple of years. We're now in the mode of a tightened scope that is focused on productivity and efficiency. In short, we as a team are working the assets we have to generate cash and demonstrate the benefits and contributions of the investments we have made. Now, with that, let me turn it over to Bill for some financial detail.