West Pharmaceutical Services, Inc.

Ladies and gentlemen, thank you for standing by, and welcome to the Q2 2020 West Pharmaceutical Services Earnings Conference call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker today, Quinton Lai, Vice President of Investor Relations. Please go ahead, sir.

Thank you, Josh. Good morning and welcome to West's second quarter 2020 conference call. We issued our financial results this morning, and the release has been posted in the investor section on the company's website located at westpharma.com. This morning, CEO Eric Green and CFO Bernard Burkett will review our financial results, provide an update on our business, and present our updated outlook for the full year 2020. There is a slide presentation that accompanies today's call, and a copy of the presentation is available on the investor section of our website. On slide two is our safe harbor statement. Statements made by management on this call and in the accompanying presentation contain forward-looking statements within the meaning of U.S. federal securities law. These statements are based on our beliefs and assumptions, current expectations, estimates, and forecasts. The company's future results are influenced by many factors beyond the control of the company, and actual results could differ materially from past results, as well as those expressed or implied in any forward-looking statement made here. Please refer to today's press release, as well as any other disclosures made by the company regarding the risk to which it is subject, including our 10-K, 10-Q, and 8-K reports. During today's call, management will make reference to non-GAAP financial measures including organic sales growth, adjusted operating profit, adjusted operating profit margin, and adjusted diluted EPS. Reconciliations and limitations of the non-GAAP financial measures to the most comparable financial results prepared in conformity to GAAP are provided in this morning's earnings release. I now turn the call over to West CEO and President Eric Green.

Thank you, Quentin, and good morning, everyone, and thank you for joining us today. I would like to begin by saying that I'm incredibly proud of how our team members across the globe have remained steadfast in our commitment to supply the much-needed components and solutions to our customers under tough circumstances. Our Q2 performance emphasizes the continued resolve of our talented team members, the strength of our company, and the criticality of the role West plays during these unprecedented times. We are in the business of helping our customers bring new medicines and treatments that improve the lives of patients, which could be more meaningful than in times like today. Driven by our mission, we experienced another solid quarter reinforced by the right market-led strategy to continuously deliver value for our customers and the patients we jointly serve. Moving to slide four, the pandemic remains our priority. Given the ever-changing situation, there's a huge sense of urgency in vaccine development. As the market leader, our teams are working tirelessly with our customers to ensure we supply the right components and solutions to help resolve this pandemic. The process for selecting the best high-quality packaging components for use with injectable medicines, including vaccines, is a complex one driven by years of science which West has pioneered. We're helping our customers in the selection process testing, and verification of components. We're doing this in a way that prepares our customers for the future commercial scale-up and launch of any successful vaccine candidates. As we stated during our first quarter earnings call, we have seen a high adoption rate of our fluoropolymer-coated stoppers made by both West and our partner, Dykeo. These are the industry standard for packaging sensitive molecules with an outstanding track record of quality and reliability. Notably, some of our customers have selected Novapure as they have made this decision to use the best in industry component to ensure the highest degree of quality and safety. As our customer's vaccine development rapidly moves into clinical trials, the entire West team has stepped up to make certain we can supply the demand for our high-value products as well as any immediate surge in requests for therapeutics. The organization is also preparing for the potential volume surges that could come if and when vaccines are approved for human use. All the work over the past few years across the enterprise to drive commercial and operational excellence, along with globalizing West's manufacturing operations, has put us in the best possible position to meet the future pandemic demand. We are accelerating our capacity expansion to manufacture Floratech and NovaPure components. These investments were in our five-year plan, and we have brought them forward to address the expected increase in demand the latter part of this year and into 2021. From our perspective, it is still too early to estimate how much volume could be generated by vaccine packaging. However, whether it's hundreds of millions or billions of doses, our West team is prepared and ready when the time comes. Turning to slide five and our performance in the second quarter. Our financial position remains strong. I'm pleased to say that the growth trends we have experienced over the past several quarters have continued in the second quarter, and the outlook for the balance of the year remains positive. We had 14% organic sales growth in the second quarter, driven again by robust high-value product sales. And with HVP sales growth, we have experienced strong gross and operating profit margin expansion. This resulted in a strong adjusted EPS for the second quarter. To be clear, the majority of the organic growth in the second quarter was from our base business with some incremental growth coming from COVID-19 sales related to therapeutics. As for guidance, we believe we are well positioned for the second half of the year. That said, because of the strength and resiliency of our core underlying business and the incremental opportunities being presented to support our customers with COVID-19 solutions, we are raising our guidance for the remainder of the year. Now, I'll turn it over to our CFO, Bernard Paquette, who will provide more detail on our second quarter financial performance and the outlook.