Triumph Group, Inc.

Welcome to Triumph's first quarter fiscal year 2023 results conference call. This call is being carried live on the internet. There is also a slide presentation included with the audio portion of the webcast. Please ensure that your pop-up blocker is disabled if you are having trouble viewing the slide presentation. All participants will be in listen-only mode. Should 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. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. In addition, please note that this call is the property of Triumph Group, Inc., and may not be recorded, transcribed, or rebroadcast without explicit written approval. I would like to introduce Tom Quigley, Triumph's Vice President of Investor Relations and Controller, who will provide a brief opening statement.

Thank you. Good morning and welcome to our first quarter fiscal 2023 earnings call. Today I'm joined by Dan Crowley, the company's chairman, president, and chief executive officer, and Jim McCabe, senior vice president and chief financial officer of Triumph. During our call, we'll be referring to the supplemental slides, which are posted on our website. Certain statements on this call constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties, and other factors, which may cause Triumph's actual results, performance, or achievements to be materially different from any expected future results, performance, or achievements expressed or implied in the forward-looking statements. Please note that the company's reconciliation of non-GAAP financial measures to comparable GAAP measures is included in the press release, which can be found on our website at www.triumphgroup.com. Dan, I'll turn it over to you.

Thanks, Tom. Earlier today, we reported our first quarter results for fiscal year 2023. I'm pleased to share that despite the challenging macro environment, Triumph demonstrated organic growth in its continuing operations and completed its portfolio transformation to position the company for the future. Our Q1 results exceeded our expectations overall. On slide three, I summarized the quarter's highlights. First, we generated organic growth in our continuing operations, driven by improving commercial OEM and MRO demand. With the sale of its Stewart, Florida plant, our 16th and final divestiture, Triumph has exited its large structure business consistent with our strategic plan. Backlog is up 7% with expanding book-to-bill and new partnerships. Triumph is well positioned to realize the benefits of our diversification strategy. Our actions to mitigate supply chain constraints have lessened the impact on Triumph as we continue to partner with our customers and suppliers to ensure supply continuity and affordability. With years of heavy cash use now behind us, we are updating our revenue and earnings guidance and reiterate our cash guidance for fiscal 23 reflecting improving sales and cash flow. Q1 marked an inflection point for the company on cash. We retired obligations of over $100 million from our legacy structures business, improved cash use from a year ago, and expect to be cash flow positive over the balance of the fiscal year. All the enablers for value creation and deleveraging are headed in the right direction. The time and energy of our team that allowed us to execute on our multi-year restructuring have shifted to organic growth and expansion of our products, services, and customer base, all of which enhance our financial forecast and predictability. Coming off a productive Farm Bureau air show, our team is excited for the future. Bottom line, our first quarter results keep us on track with our goal of doubling profitability over fiscal years 2022 to 2025, driven by improved OEM production rates, expanded MRO volumes, enhanced pricing from recent contract extensions, and lower cost structure as a result of our transformation. As we pursue expanded margins, we're also focused on growth. In the first quarter, we secured over $422 million and new orders across our continuing business. Backlog has troughed and begun to grow after years of top-line contraction. Commercial backlog in Triumph's systems and support business is up 24% for the quarter, paced by an 80% increase in 737 MAX backlog, partially offset by a modest decline in military backlog. Total company and systems and support book-to-bill ratios for the quarter were approximately 1.5. Both MRO receipts and new RFP volume remain very high. A Triumph delegation just returned from the 2022 Farnborough International Air Show, the first in-person event since 2018, where more than 15,000 exhibitors met signaling a return to a normalized aerospace market. I met with the CEOs of more than 20 of our key customer organizations, and our team met with over 100 suppliers. Industry participants were optimistic, tempered with some concern around the supply chain's ability to support the anticipated ramp rates. In the last week, Boeing, Airbus, and GE signaled short delays in the timing of production ramp step-ups, typically three to six months, which will not have a material impact on the narrow-body ramp or Triumph's financial outlook. Our collective challenge remains, how quickly can we get to rates far greater than achieved prior to the pandemic? In the quarter, Triumph announced plans to partner with Moabatala's Setted Engine Overhaul business in the UAE to play a larger role in MRO expansion in the Middle East. We view this formative partnership as complementary to our recently launched joint venture with Air France KLM called Excel. Both accelerate our capabilities and footprint and provide early life access to engine component MRO. Triumph and Senate will jointly establish in-region capabilities to improve turnaround time and support to customers such as GE and Rolls-Royce. Triumph also announced an agreement with Moog in which we combined our respective 787 landing gear and flight control actuator offerings under a power-by-the-hour contract for an Asian carrier. You can expect Triumph to pursue more partnerships and new channels to market to expand our reach and top line. Last, Triumph is collaborating with Lockheed Martin to jointly develop components and subsystems for future aircraft thermal management systems. As aircraft electrification advances, new ways to dissipate heat will be needed, and we are creating IP to support these demands. Other wins for the quarter can be seen on slides four and five. Despite short-term supply chain pressures, the air travel market and carrier financial health both continue to recover. The improving travel demand is aiding industry profitability, which, coupled with higher fuel prices, increases the prospect for new aircraft orders and rate increases. On July 1st, IATA forecasted North American operators would post a profit for 2022, while global operator are posting near break-even profitability, a substantial turnaround since the losses of 2020. This air traffic recovery is reflected in Triumph's MRO revenue, which is up 95% for the quarter and 38% sequentially. Cargo revenues declined 21% for the quarter, though still operating at levels above those of 2019 as commercial transport belly capacity returns. Triumph's engine customer revenues rose 23% for the quarter driven by single-aisle LEAP engine gearboxes. GE anticipates flattened demand over the next few months as the supply chain prepares for the ramp, but we remain confident in the longer-term outlook. Military spending remains strong, with the President's fiscal 23 Defense Department request of $773 billion expected to benefit from both House and Senate appropriation committees recommended increases of approximately $37 to $45 billion. The platforms supported by TRIUMPH, which are enjoying strong budget support, include the CH-53K, the CH-47, the F-15, T-7A, and Joint Strike Fighter. That said, TRIUMPH's military end market was off 20% for the quarter, driven by prior year orders on C-130 and E-2D, though These declines were offset by commercial and market improvements. This is primarily a timing issue, and we expect military revenues to recover and normalize over the course of the year. Brian continues to proactively mitigate supply chain issues. Deliveries from suppliers were 80 to 90 percent on time and full in Q1. We put strategic order coverage in place to secure allocation of resources and protect our most critical programs. Triumph has very little exposure to supply chain impacts from the war in the Ukraine. While our suppliers are not achieving the 100% on time performance we expect, we were able to meet our sales targets in Q1 and anticipate recovery quarter over quarter with over 40 million of past due backlog expected to be retired by the end of fiscal 23. We are working to offset potential price increases directly with suppliers and aggressively adding alternative suppliers where possible. As a result, these increases have typically totaled less than 2 percent of sales, and we expect any impact to be immaterial to our results. Our top supply chain priority remains securing near-term delivery assurance and available capacity from our suppliers as the industry recovers. In the quarter, we issued our sustainability and annual report, which includes our recently developed five- and ten-year sustainability goals. We look forward to solidifying our path to meet these targets, which are essential drivers to our sustainability programs in the years ahead. As noted in the report, Triumph is powered by diversity, where our competitive strength comes from a complementary blend of people, products, platforms, and end markets. This broader take on diversity helps Triumph to be more resilient and perform at higher levels so that we remain differentiated in the market. We are committed to creating value in a sustainable way, investing in our people and processes and improving our quality, productivity, and agility. With that, Jim will now take us through the results for the quarter in more detail. Jim?