PGT Innovations, Inc.

Innovations, fourth quarter, 2022 earnings call. All participants will be in listen-only mode. If 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. Please note that this event is being recorded. I'd like to turn the call over to Mr. Brad West, Senior Vice President of Corporate Development.

Please go ahead. Thank you. Good morning and welcome to the PGT Innovations fourth quarter and full year 2022 investor conference call. With me on the call today are our president and CEO, Jeff Jackson, and our chief financial officer, John Coons. On the investor relations section of our company website, you'll find the earnings press release issued earlier today, as well as the slide presentation we have posted to accompany today's discussion. This webcast is being recorded and will be available for replay on the company's website. Before we begin our prepared remarks, please direct your attention to the disclosure statement on slide two of the presentation, as well as the disclaimers included in the earnings press release and our SEC filings that discuss forward-looking statements. Today's remarks contain forward-looking statements, including statements about our 2023 financial performance outlook. Those statements involve risks, uncertainties, and other factors that could cause actual results to differ materially. Additional information on factors that could cause actual results to differ from expected results is available on the company's most recent SEC filings. Additionally, on slide three, note that we report results using non-GAAP financial measures, which we believe provide additional information to help investors compare performance between reporting periods. A reconciliation to the most directly comparable gap measures is included in the tables in the earnings release and in the slide presentation appendix. At this time, I will now hand over the call to our company CEO and President, Jeff Jackson.

Thank you, Brad. Good morning, everyone, and thanks for joining us on today's call. I'd like to begin by thanking each and every team member for their contributions to what turned out to be a record year for PGT Innovations. Despite the challenges we face, which included both a Category 4 hurricane and a subsequent ransomware attack, we overcame and delivered record revenue in EBITDA for the full year. Our growth is a result of our steady effort to improve PGT Innovations through our strategic and operational framework of profitable growth as we continue to create long-term value for our shareholders while serving our customers and communities. We hit the ground running in 2022. Despite inflationary pressures on materials, labor costs, supply chain challenges, hurricanes, ransomware attacks, and a slowing economy due to high interest rates, we were able to increase revenue to $1.49 billion, grow adjusted EBITDA to $254 million, and expand our adjusted EBITDA margins by 240 basis points compared to 2021. We also expanded our product portfolio with the addition of Martin Garage Doors. Martin has allowed us to expand into an adjacent building products category, add premium garage doors to our product portfolio, broaden our geographic footprint and brand presence, while creating cross-selling opportunities for both companies. We are still in the early stages of integrating Martin Business and remain optimistic about the opportunities the acquisition brings to PGT Innovations in the coming years. Next, on slide five, let's take a closer look at the fourth quarter, our sales trends, and key messages. Despite the challenges presented by Hurricane Ian and the ransomware attack, we generated total revenue of $341 million during the quarter. As we mentioned on our third quarter call, both events limited our ability to generate revenue during the fourth quarter. Thus, organic growth was 5% for the quarter. Sales in our southeast region were impacted by both events, leading to sales of $243 million during the quarter and increase of $5 million versus the prior year quarter. However, our focus on cost, labor efficiencies, lead times, service, and quality allowed us to reduce our backlog from the third quarter, even though we had sequential increases in orders in the Southeast region. These improvements positioned us to be the supplier of choice for our customers going into 2023. allowing us to execute one of our strategic initiatives of recapturing market share. Operationally, the suddenness of each event did not allow our operating teams to immediately adjust our cost structure to match the operating capacities at our plants. This resulted in unfavorable, detrimental margins during the quarter. However, for the month of December, our Venice operations had fully recovered and are currently at operating rates better than they were prior to the storm. While the ransomware attack did temporarily disrupt our southeast Florida operations, our business technology services team did a fantastic job in restoring our systems and getting us back up and running, averting any need to make any ransomware payment. Organic sales in the western region increased by 10 million, or 15%. with strong growth coming from each core market. The investments we made in production capacity has allowed us to increase our throughput by 30% since December 2021, restoring our lead times primarily to the four to 10 week range. Western Window Systems now has the capacity to produce over 5 million of products each week with the addition of our recently acquired manufacturing space. Both lines of our Western Window business custom and production builders grew in the quarter and full year. Additionally, we are expecting to see increased share in the premium indoor outdoor market with the launch of our newest 300 series minimalist sliding glass door. This product was introduced at the International Builder Show earlier this month, and the initial reactions have been extremely encouraging. The expansion initiatives at Anilin are in an early stage of implementation, these initiatives will enable us to increase our production capacity, expand our product portfolio, and allow us to increase our focus in the Southwest Region R&R vinyl markets. All results at Emlyn came in above our acquisition model expectations. We were able to leverage our price-cost portfolio at our Western Business Unit with increased sales resulted in higher segment EBITDA margins compared to the prior year quarter. Our commitment to innovation, which drives us to deliver products with features, performance, and value demanded by our builders and customers, was highlighted during the quarter with the launch of two new innovative glass products, our thin triple insulated glass unit and our diamond glass impact resistant glass units. PGT Innovations will be the first manufacturer in the U.S. window and door market to offer such products. Additionally, we will be the exclusive supplier of impact resistant windows and doors featuring Diamond Glass for the use in residential and mixed use buildings in the U.S. Diamond Glass provides greater clarity, more scratch resistance, and up to 45% lighter than the standard impact product and thus easier to install. All these benefits come with the same design pressure and impact ratings as our current products. Fin Triple Glass provides improved performance to meet the tightening North America energy standards known as Energy Star version 7. It meets the Inflation Reduction Act requirements for a homeowner to obtain incentives without the need for frame, hardware, or installation rework. and they have a significant weight and cost advantage to other emerging technologies. Our backlog was $235 million at the end of the year, including $5 million related to Martin, down from $356 million at the start of the year. We received organic orders of $291 million of products during the fourth quarter, down from $307 million in the prior year quarter. This reduction in backlog is due to our improved operational performance and the realization of the investments we've been making in our business. Now, I'd like to turn the call over to John Kuntz to review the second quarter results in greater detail. John?