SPX Technologies, Inc.

Thank you for standing by, and welcome to the Q1 2021 SDX Corporation earnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you need to press star then 1 on your telephone. Please be advised that today's call is being recorded. If you require additional assistance, you may press star then 0 to reach an operator. I would now like to hand the call over to Paul Clegg, VP of Investor Relations and Communications. Please go ahead.

Thank you, and good afternoon, everyone. Thanks for joining us. With me on the call today are Jean Lowe, our President and Chief Executive Officer, and Jamie Harris, our Chief Financial Officer. A press release containing our first quarter results was issued today after market close. You can find the release in our earnings slide presentation, as well as a link to a live webcast of this call in the investor relations section of our website at spx.com. I encourage you to review our disclosure and discussion of GAAP results in the press release and to follow along with the slide presentation during our prepared remarks. A replay of the webcast will be available on our website until May 12th. As a reminder, portions of our presentation and comments are forward-looking and subject to Safe Harbor provisions. Please also note the risk factors in our most recent SEC filings, including our disclosures related to the ongoing COVID-19 pandemic. Our comments today will largely focus on adjusted financial results. You can find detailed reconciliations of historical figures, adjusted figures to the respective gap measures in the appendix to today's presentation. Our segment reporting structure includes the results of our South African operations in an other category, which is excluded from our adjusted results. Our adjusted earnings per share also exclude non-service pension items, amortization expense, an investment gain, certain favorable discrete tax items, and acquisition-related costs. Finally, we will be conducting virtual meetings with investors over the coming months, including at the UBS Global Industrials and Transportation Conference on June 8th. And with that, I'll turn the call over to Gene.

Thanks, Paul. Good afternoon, everyone, and thank you for joining us. On the call today, we'll provide you with a brief update on our consolidated and segment results for the first quarter. We'll also provide an update to our full year guidance. Now I'll touch on some of the highlights from the quarter. We had a solid start to the year. Our HVAC and detection and measurement segments performed well and drove strong revenue and earnings growth. During the quarter, we continue to execute on our value creation framework with another attractive acquisition that bolsters our aged navigation or ATON platform and our detection and measurement segment. We believe that CLITE is an excellent strategic addition to our existing ATON portfolio. We are updating our 2021 guidance for the acquisition of CLITE, which we completed in mid-April and are on track to achieve double-digit earnings growth for the full year. In Q1, we grew adjusted revenue approximately 9% with significant contributions from both organic and inorganic drivers. Our adjusted operating income grew 8% driven by the performance of our HVAC and detection and measurement segments. Our cash generation was the strongest for our first quarter since the spinoff transaction in 2015. In summary, I am pleased with the quarter and our current positioning for the future. With significant capital availability, an attractive M&A pipeline, and several ongoing organic and continuous improvement initiatives, SPX is poised to drive value for years to come. As always, I'd like to touch on our value creation framework. I am very proud of our team for the way they have managed through the pandemic while continuing to execute on key initiatives that will better position SPX for the future. During the first quarter, we continued to make progress on several fronts, strengthening our ATOM platform through the acquisition of CLITE, progressing on our continuous improvement and digital initiatives, extending our actions on diversity and inclusion, and enhancing our ESG focus and activities. Sealight is our eighth acquisition in the last three years and the second specific to our ATON platform. In total, we have deployed approximately $525 million in capital for these eight companies, representing approximately $260 million in annualized revenue. Sealight is a leader in the design and manufacture of marine and aviation ATON products. It is headquartered in Melbourne, Australia, and has operations globally, including New Hampshire. We anticipate that Sea Light will contribute analyzed revenue in a range of $30 to $40 million. We anticipate margins initially to be a bit lower than segment average until the business is fully integrated over the next 12 to 18 months. The company is an excellent fit with SPX's existing portfolio of terrestrial and marine obstruction solutions expanding our geographic coverage as well as our reach into a broader set of adjacent products and technologies. Our strategy here is similar to the growth story of our location and inspection platform, which has grown from approximately $100 million in annualized revenue to approximately $250 million of annualized revenue in a little over three years. Prior to our acquisitions in this space, our ATON business consisted of flash technology, which was already a market leader in obstruction lighting systems used for cell towers and other tall vertical structures regulated by the FAA. These applications require highly engineered specialty equipment to accommodate extreme environments and real-time monitoring capabilities to alert customers to outages that could endanger passing aircraft. In 2019, we expanded our ATON portfolio into the marine aids to navigation market with the acquisition of SAVIC, a leader in lighting solutions for lighthouses, harbors, ports, canals, and other waterways. These are extreme environments that require high levels of engineering and product reliability. Today, with the addition of SeaLight, we have extended our positioning in marine applications and enhanced our portfolio of air-filled ground lighting solutions such as military airstrips used for remote deployments. In just a few years, this platform has grown from a $40 to $50 million obstruction lighting business into the global leader of a highly engineered ATON solutions with roughly $110 million in EMI sales. We are very pleased with the acquisition and see significant opportunity to drive further value as we continue to develop and offer innovative solutions to our global customers. I wanted to spend a few minutes discussing our commitment to ESG. This is an area we are very passionate about. SPX is committed to a strong sustainability culture and continuous improvement on environmental, social, and governance issues. We view this commitment as a journey and believe that our efforts will create long-term value for all stakeholders and position SPX for continued success in the long term. We believe SPX is well positioned to thrive in a world where long-term targets on carbon emissions are realized. We have a strong ESG record and plan to spend more time and focus communicating it. Many of our businesses, products, and initiatives support a sustainable future. From our cooling towers, which can help reduce energy usage in buildings, to our inspection equipment, that helps remediate leakage of underground water and wastewater pipes with minimal environmental disruption, we offer a wide array of highly efficient and innovative products for the maintenance of critical infrastructure. Every year, we publish a sustainability report, which includes data on our energy and water usage, greenhouse gas emissions, and employee health and safety, as well as additional data and information to help our stakeholders evaluate our ESG positioning, risk, and opportunities. This year, we intend to include more information and details about our diversity and inclusion initiatives where I'm pleased with the work our team has accomplished over the past several years. I'm particularly proud of our board, which has provided us with excellent guidance and leadership and brings a wide variety of backgrounds, experience, and perspectives. And now I'll turn the call over to Jamie to review our financial results.