Q2 2024 TriMas Corp Earnings Call

Operator: Greetings, and welcome to the TriMas Second Quarter 2024 Earnings Conference Call. At this time, all participants are in the listen-only mode.

Operator: Greetings, and welcome to the TriMas 2nd quarter 2024 earnings conference call. At this time, all participants are in listen-only mode.

Speaker Change: Greetings and welcome to the TriMas second quarter 2024 earnings conference call. At this time all participants are in the listen-only mode.

Operator: A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Sherry Lauderback, Vice President of Investor Relations. Thank you.

Operator: A brief question-and-answer session will follow the formal presentation.

A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad.

Operator: If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded.

Sherry Lauderback: It is now my pleasure to introduce your host, Sherry Lauderback, Vice President of Investor Relations. Thank you. And welcome to TriMas Corporation 2nd quarter, 2024 earnings call. Participating on the call today are Thomas Amato, TriMas President and CEO, and Scott Mell, our Chief Financial Officer. We will provide our prepared remarks on our 2nd quarter results and outlook, and then we will open up the call for questions. In order to assist with the review of our results, we have included today's press release and presentation on our company website at TriMas.com under the Investor section. In addition, a replay of this call will be available later today by calling 877-660-6853 with a meeting ID of 1-3-74-7794.

As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Sherry Lauderback, Vice President of Investor Relations. Thank you. You may begin.

Sherry Lauderback: You may begin. Thank you, and welcome to TriMas Corporation's second quarter 2024 earnings call. Participating on the call today are Thomas Amato, TriMas' President and CEO, and Scott Mell, our Chief Financial Officer. We will provide our prepared remarks on our second quarter results and outlook, and then we'll open up the call for questions. In order to assist with the review of our results, we have included today's press release and presentation on our company website at www.trimas.com under the Investors section. In addition, a replay of this call will be available later today by calling 877-660-6853 with a meeting ID of 1-3-877-6805. 747794.

Speaker Change: Thank you and welcome to TriMas Corporation's second quarter 2024 earnings call. Participating on the call today are Thomas Amato, TriMas' President and CEO , and Scott Mell, our Chief Financial Officer.

Speaker Change: We will provide our prepared remarks on our second quarter results and outlook, and then we will open up the call for questions.

Speaker Change: In order to assist with the review of our results, we have included today's press release and presentation on our company website at www.trimas.com under the Investor section.

Speaker Change: In addition, a replay of this call will be available later today by calling 877-660-6853 with a meeting ID of 1-374-7794.

Sherry Lauderback: Before we get started, I would like to remind everyone that our comments today may contain 4-looking statements that are inherently subject to a number of risks and uncertainties. Please refer to our Form 10-K and our Form 10-Q to be filed later today for a list of factors that could cause our results to differ from those anticipated in any 4-looking statements. Also, we undertake no obligation to publicly update or revise any 4-looking statements, except as required by law. We would also direct your attention to our website, where considerably more information may be found. In addition, we would like to refer you to the appendix in our press release or our presentation for the reconciliations between GAAP and non-GAAP financial measures used during this call.

Sherry Lauderback: Before we get started, I would like to remind everyone that our comments today may contain forward-looking statements that are inherently subject to a number of risks and uncertainties. Please refer to our Form 10-K and our Form 10-Q, which will be filed later today, for a list of factors that could cause our results to differ from those anticipated in any forward-looking statement. Also, we undertake no obligation to publicly update or revise any forward-looking statements, except as required by law.

Speaker Change: Before we get started, I would like to remind everyone that our comments today may contain forward-looking statements that are inherently subject to a number of risks and uncertainties.

Speaker Change: Please refer to our Form 10-K and our Form 10-Q to be filed later today for a list of factors that could cause our results to differ from those anticipated in any forward-looking statement.

Speaker Change: Also, we undertake no obligation to publicly update or revise any forward-looking statements except as required by law. We would also direct your attention to our website where considerably more information may be found.

Sherry Lauderback: We would also like to direct your attention to our website, where considerably more information may be found. In addition, we would like to refer you to the appendix in our press release or in our presentation for the reconciliations between GAAP and non-GAAP financial measures used during this call. Today, the discussion on the call regarding our financial results will be on an adjusted basis, excluding the impact of special items. With that, I will turn the call over to Tom Amato, TriMas' President and CEO. Tom?

Speaker Change: In addition, we would like to refer you to the appendix in our press release or our presentation for the reconciliations between GAAP and non-GAAP financial measures used during this call. Today, the discussion on the call regarding our financial results will be on an adjusted basis.

Sherry Lauderback: Today, the discussion on the call regarding our financial results will be on an adjusted basis, excluding the impact of special items. With that, I will turn the call over to Tom Amato, TriMas.com's President and CEO, Tom.

Thomas A. Amato: excluding the impact of special items. With that, I will turn the call over to Tom Amato, TriMas' President and CEO . Tom? Thank you, Sherry. Good morning, and thank you for joining us on our second quarter earnings call. Let's turn to slide three.

Thomas Amato: Thank you, Sherry.

Thomas Amato: Good morning, and thank you for joining us on our second quarter earnings call. Let's turn to slide three. As I'm certain you have seen from our earnings releases this morning, while the resiliency of TriMas' packaging and aerospace businesses have become more evident, our businesses within the specialty products industrial markets have not yet seen the demand recovery we anticipated would have occurred by this point in the year. However, as we reflect on the quarter and the first half of the year, we experience the number of positive developments, which we believe will translate into long-term opportunities for value creation, despite encountering some discrete challenges.

Thomas A. Amato: Thank you, Sherry. Good morning, and thank you for joining us on our second quarter earnings call. Let's turn to slide three. As I'm certain you have seen from our earnings release this morning, while the resiliency of TriMas' packaging and aerospace businesses has become more evident, our businesses within the specialty products industrial markets have not yet seen the demand recovery we anticipated would have occurred by this point in the year. However, as we reflect on the quarter and the first half of the year, we experienced a number of positive developments, which we believe will translate into long-term opportunities for value creation, despite encountering some discrete challenges. I'll provide one example from our largest group, TriMas Package.

Speaker Change: As I'm certain you have seen from our earnings release this morning, while the resiliency of TriMas' packaging and aerospace businesses have become more evident, our businesses within the specialty products industrial markets have not yet seen the demand recovery we anticipated would have occurred by this point in the year.

Speaker Change: However, as we reflect on the quarter and the first half of the year, we experience a number of positive developments, which we believe will translate into long-term opportunities for value creation, despite encountering some discrete challenges.

Thomas Amato: I'll provide one example from our largest group, TriMas' packaging. When demand pulled back last year, we were tempted to deeply cut costs. While we flex some variable costs, we instead leaned into re-engineering our commercial approach to drive long-term growth. We invested in a new customer relationship management application, and we also invested in reorganizing our commercial model, replicating an AV-20 approach. Coach. Although these initiatives are still in early stages of integration, we believe these internal changes, coupled with a natural market recovery, are now contributing to the strong core growth rates we are experiencing in our packaging group today.

Speaker Change: I'll provide one example from our largest group, TriMas Packaging.

Thomas A. Amato: When demand pulled back last year, we were tempted to deeply cut costs. While we flexed some variable costs, we instead leaned into reengineering our commercial approach to drive long-term growth. We invested in a new customer relationship management application, and we also invested in reorganizing our commercial model, replicating an 80-20 approach. Although these initiatives are still in the early stages of integration, we believe these internal changes, coupled with a natural market recovery, are now contributing to the strong core growth rates we are experiencing in our packaging group today.

Speaker Change: When demand pulled back last year, we were tempted to deeply cut costs. While we flexed some variable costs, we instead leaned into re-engineering our commercial approach to drive long-term growth.

Speaker Change: We invested in a new customer relationship management application, and we also invested in reorganizing our commercial model, replicating an 80-20 approach.

Speaker Change: Although these initiatives are still in early stages of integration, we believe these internal changes, coupled with a natural market recovery, are now contributing to the strong core growth rates we are experiencing in our packaging group today.

Thomas Amato: Given the foundational growth and revenue, I remain very excited about TriMas Packaging's potential, and I'm confident we will improve upon conversion rates as we move forward. Next, I would like to provide an example for our TriMas Aerospace group. When I compare the second quarter of last year to this most recent quarter, the dynamics couldn't be more different. In the second quarter of last year, we face a snapback of demand from our aerospace customers, compounded by supply and labor constraints, as well as several voluntary leadership changes. The broad-based actions and leadership top rating we implemented over the past year are too numerous to list for this call.

Thomas A. Amato: Given the foundational growth in revenue, I remain very excited about TriMas packaging's potential, and I'm confident we will improve upon conversion rates as we move forward. Next, I would like to provide an example for our TriMas Aerospace Group.

Speaker Change: Given the foundational growth in revenue, I remain very excited about TriMas packaging's potential, and I'm confident we will improve upon conversion rates as we move forward.

Speaker Change: Next, I would like to provide an example for our TriMas Aerospace Group. When I compare the second quarter of last year to this most recent quarter, the dynamics couldn't be more different.

Thomas A. Amato: When I compare the second quarter of last year to this most recent quarter, the dynamics couldn't be more different. In the second quarter of last year, we faced a snapback of demand from our aerospace customers compounded by supply and labor constraints, as well as several voluntary leadership changes. The broad-based actions and leadership top grading we implemented over the past year are too numerous to list for this call, but suffice it to say, we have successfully turned around the prospects for TriMas Aerospace.

Speaker Change: In the second quarter of last year, we faced a snapback of demand from our aerospace customers compounded by supply and labor constraints, as well as several voluntary leadership changes.

Speaker Change: The broad-based actions and leadership top grading we implemented over the past year are too numerous to list for this call, but suffice it to say we have successfully turned around the prospects for TriMas Aerospace.

Thomas Amato: But suffice it to say, we have successfully turned around the prospect for TriMas Aerospace. Assuming no further shocks in the A&D market, our aerospace business, or our aerospace business specifically, we anticipate exiting 2024 at a conversion rate nearing pre-COVID levels, but more importantly, at approximately 50 percent higher rate of sales. I also remain very excited about the long-term prospect for TriMas Aerospace.

Thomas A. Amato: Assuming no further shocks in the A&D market, or our aerospace business specifically, we anticipate exiting 2024 at a conversion rate nearing pre-COVID levels, but more importantly, at approximately 50% higher rates of sales. I also remain very excited about the long-term prospects for TriMas Aerospace.

Speaker Change: Assuming no further shocks in the A&D market, or our aerospace business specifically,

Speaker Change: We anticipate exiting 2024 at a conversion rate nearing pre-COVID levels, but more importantly, at approximately 50% higher rate of sales.

Speaker Change: I also remain very excited about the long-term prospect for TriMas Aerospace.

Thomas Amato: While those are a few examples, on a few positive examples, unfortunately, our specialty product segment experienced a very different set of N-market dynamics since the same quarter last year, and even since Q1 2024. Moreover, we have planned for demand to begin to recover in the second quarter of this year, predominantly within our North cylinder business. However, total bookings demand actually softened further, prompting us to lower our sales forecast within especially products for the second half. In fact, the change in volume with our north cylinder business is the main negative driver that impacted our first half and our annual outlook.

Thomas A. Amato: While those are a few positive examples, unfortunately, our specialty product segment experienced a very different set of end market dynamics since the same quarter last year and even since Q1 2024. Moreover, we have planned for demand to begin to recover in the second quarter of this year, predominantly within our North Cylinder business. However, total bookings and demand actually softened further, prompting us to lower our sales forecast within specialty products for the second half.

Speaker Change: While those were a few positive examples, unfortunately, our specialty product segment experienced a very different set of end market dynamics since the same quarter last year, and even since Q1 2024.

Speaker Change: Moreover, we have planned for demand to begin to recover in the second quarter of this year, predominantly within our Norris Cylinder business.

Speaker Change: However, total bookings and demand actually softened further, prompting us to lower our sales forecast within specialty products for the second half.

Thomas A. Amato: In fact, the change in volume with our North Cylinder business is the main negative driver that impacted our first half and our annual outlook. Both Scott and I will be covering this dynamic in more detail throughout the call. So with that backdrop, our consolidated sales for the quarter were up 3.1%, with our packaging and aerospace groups increasing 12.5% and 30%, respectively. As noted, our specialty product segment experienced a reduction in sales driven from prior year overstocking and other factors of approximately 45%.

Speaker Change: In fact, the change in volume with our Norris Cylinder business is the main negative driver that impacted our first half and our annual outlook.

Thomas Amato: Both Scott and I will be covering this dynamic in more detail throughout the call. So, with that backdrop, our consolidated sales for the quarter were up 3.1 percent, with our packaging and aerospace groups increasing 12.5 percent and 30 percent, respectively. As noted, our specialty product segment experienced a reduction in sales driven from prior year overstocking and other factors of approximately 45 percent. Despite specialty products representing approximately 15 percent of TriMas' total portfolio sales, given our scale, the larger rate of change had a profound performance impact on the quarter. I would now like to turn our attention to share repurchases for the first half of the year.

Speaker Change: Both Scott and I will be covering this dynamic in more detail throughout the call.

Scott A. Mell: So with that backdrop, our consolidated sales for the quarter were up 3.1%, with our packaging and aerospace groups increasing 12.5% and 30% respectively.

Speaker Change: As noted, our specialty product segment experienced a reduction in sales driven from prior year overstocking and other factors of approximately 45%.

Thomas A. Amato: Despite specialty products representing approximately 15% of TriMas' total portfolio sales, given our scale, the large rate of change had a profound performance impact in the quarter. I would now like to turn our attention to Sherry Purchases for the first half of the year. On a year-to-date basis, including the actions in the second quarter, we repurchased approximately 672,000 shares for a net reduction of approximately 1.3% of shares outstanding.

Speaker Change: Despite specialty products representing approximately 15% of TriMas' total portfolio sales, given our scale, the large rate of change had a profound performance impact in the quarter.

Speaker Change: I would now like to turn our attention to share repurchases for the first half of the year. On a year-to-date basis, including the actions in the second quarter, we repurchased approximately 672,000 shares for a net reduction of approximately 1.3% of shares outstanding.

Thomas Amato: On a year-to-date basis, including the actions in the second quarter, we repurchased approximately 672,000 shares for a net reduction of approximately 1.3 percent of shares outstanding. This rate of share repurchases is higher than the last year, and we continue to believe that reducing shares outstanding is a tax-efficient way to return long-term value to our shareholders. I will also note that we have ample room under our Sherry Lauderback authorization and will continue to place a priority on opportunistic Sherry Lauderback as we assess value-dislocating events in the market. Let's turn to slide 4. On this slide, given the nuances of this quarter, we thought it would be helpful to take a few minutes to review sequential quarterly performance, which we believe will provide investors with a better view of our current status.

Thomas A. Amato: This rate of share repurchases is higher than last year, and we continue to believe that reducing shares outstanding is a tax-efficient way to return long-term value to our shareholders. I will also note that we have ample room under our share buyback authorization and will continue to place a priority on opportunistic share buybacks as we assess value-dislocating events in the market. Now, let's turn to slide four.

Speaker Change: This rate of share repurchases is higher than the last year, and we continue to believe that reducing shares outstanding is a tax-efficient way to return long-term value to our shareholders.

Speaker Change: I will also note that we have ample room under our share buyback authorization and will continue to place a priority on opportunistic share buybacks as we assess value-dislocating events in the market.

Thomas A. Amato: On this slide, given the nuances of this quarter, we thought it would be helpful to take a few minutes to review sequential quarterly performance, which we believe will provide investors with a better view of our current status. Starting with TriMas packaging, we experienced 3.9% organic growth as compared to Q1 2024. We believe growth and demand are beginning to return as customers start to refill pipelines after inventory stocks were depleted in key channels last year. Additionally, commercial dynamics are much improved from last year based on our in-booking rate and new business quoting activity.

Speaker Change: Let's turn to slide four.

Speaker Change: On this slide, given the nuances of this quarter, we thought it would be helpful to take a few minutes to review sequential quarterly performance, which we believe will provide investors with a better view of our current status.

Thomas Amato: Starting with TriMas Packaging, we experienced 3.9% organic growth as compared to Q1 2024. We believe growth and demand is beginning to return as customers start to refill pipelines after inventory stocks were depleted in key channels last year. Additionally, commercial dynamics are much improved from last year based on our in-bookings rate and new business quoting activity. Conversion was essentially comparable between the first and second quarters of 2024, as our pull-through rate continues to be hampered from off-standard production and expedited freight costs from high demand on certain product lines. We do anticipate conversion rates will improve on a higher rate of sales as we move through the year and into 2025.

Speaker Change: Starting with TriMas packaging.

Speaker Change: We experienced 3.9% organic growth as compared to Q1 2024.

Speaker Change: We believe growth and demand is beginning to return as customers start to refill pipelines after inventory stocks were depleted in key channels last year.

Speaker Change: Additionally, commercial dynamics are much improved from last year based on our in-bookings rate and new business quoting activity.

Thomas A. Amato: Conversion was essentially comparable between the first and second quarters of 2024, as our pull-through rate continues to be hampered from off-standard production and expedited freight costs from high demand on certain product lines. We do anticipate conversion rates will improve on a higher rate of sales as we move through the year and into 2025. As compared to the first quarter of this year, we are continuing to see positive results from the sweeping operational and commercial actions we have been focused on over the past year.

Speaker Change: Conversion was essentially comparable between the first and second quarters of 2024, as our pull-through rate continues to be hampered from off-standard production and expedited freight costs from high demand on certain product lines.

Speaker Change: We do anticipate conversion rates will improve on a higher rate of sales as we move through the year and into 2025.

Thomas Amato: Within our TriMasero space group, we compared to the first quarter of this year, as compared to the first quarter of this year, we are continuing to see positive results from the sweeping operational and commercial actions we have been focused on over the past year. While we still believe we have some upside to achieve and conversion to get back to pre-COVID levels, as mentioned, we are now operating on a much higher rate of sales, therefore driving growth in absolute EBDA. This improvement is a testament to the TriMasero space team collaborating with our supplier partners and also focusing on operational and commercial excellence improvements.

Speaker Change: within our TriMas Aerospace Group.

Speaker Change: As compared to the first quarter of this year, we are continuing to see positive results from the sweeping operational and commercial actions we have been focused on over the past year.

Thomas A. Amato: While we still believe we have some upside to achieve on conversion to get back to pre-COVID levels, as mentioned, we are now operating at a much higher rate of sales, therefore driving growth in absolute EBITDA. This improvement is a testament to the TriMas Aerospace team collaborating with our supplier partners and also focusing on operational and commercial excellence improvement. Within our specialty product segment, as compared to the first quarter of this year, revenues softened by 5.8 percent.

Speaker Change: While we still believe we have some upside to achieve on conversion to get back to pre-COVID levels, as mentioned, we are now operating at a much higher rate of sales, therefore driving growth in absolute EBITDA.

Speaker Change: This improvement is a testament to the TriMas Aerospace team collaborating with our supplier partners and also focusing on operational and commercial excellence improvements.

Thomas Amato: Within our specialty product segment, as compared to the first quarter of this year, revenue is often up by 5.8%. The resulting sales rate is a very low base for our specialty products group, and we believe we are now beginning to exit the cyclical demand trough. However, our expectations for sales in the second half have been tempered for our North Cylinder business given the rate of demand experience in the second quarter. As such, we have implemented further flexing actions, now taking deeper structural costs out of our North Cylinder business to improve performance even at a lower base of sales.

Thomas A. Amato: The resulting sales rate is a very low base for our specialty products group, and we believe we are now beginning to exit this cyclical demand trough. However, our expectations for sales in the second half have been tempered for our North Cylinder business given the rate of demand experienced in the second quarter. As such, we have implemented further flexing actions, now taking deeper structural costs out of our Norris Cylinder business to improve performance even at a lower base of sales.

Thomas Amato: And we know this is possible, as we have performed historically better at sales rates, not too far off from where we are experiencing today.

Thomas A. Amato: And we know this is possible as we have performed historically better at sales rates, not too far off from where we are experiencing today. Let's turn to slide five, and I'll briefly go through our consolidated results for the quarter. We are reporting sales of $240.5 million, up 3.1% as compared to the prior quarter due to the factors previously discussed. Adjusted operating profit of $20.8 million was lower than the prior year quarter given demand challenges within our specialty products businesses, as well as certain favorable factors benefiting TriMas in the second quarter of 2023, which did not repeat.

Thomas Amato: Let's turn to site 5 and now briefly go through our consolidated results for the quarter. We are reporting sales of 240.5 million, up 3.1%, as compared to the prior year quarter, due to the factors previously discussed. A adjusted operating profit of 20.8 million was lower than the prior year quarter given demand challenges within our specialty products businesses, as well as certain favorable factors benefiting TriMasero in the second quarter of 2023, which did not repeat. D.P.S. was 43 cents, which was lower than we anticipated in this quarter due to the factors noted previously and lower as compared to the prior year quarter.

Speaker Change: Adjusted operating profit of $20.8 million was lower than the prior year quarter given demand challenges within our specialty products businesses, as well as certain favorable factors benefiting TriMas in the second quarter of 2023, which did not repeat.

Thomas A. Amato: Adjusted EPS was $0.43, which was lower than we anticipated in this quarter due to the factors noted previously and lower as compared to the prior year quarter. Adjusted EBITDA was $36.6 million, or 15.2% of sales, lower than the prior year quarter, with the vast majority of the shortfall driven by demand changes and related conversion within our specialty products businesses. As we have noted on prior calls, our balance sheet remains strong, and our low interest-bearing senior notes do not mature until 2029.

Speaker Change: Adjusted EPS was $0.43, which was lower than we anticipated in this quarter due to the factors noted previously, and lower as compared to the prior year quarter.

Thomas Amato: Adjusted EBITDA was 36.6 million, or 15.2% of sales, lower than the prior year quarter, with the vast majority of the shortfall driven by demand changes and related conversion within our specialty products businesses. As we have noted on prior calls, our balance sheet remains strong, and our low interest bearing senior note do not mature until 2029. It is also important to note that we generated 11.4 million of free cash flow in this quarter, in line with last year, despite a lower base of absolute EBITDA, as we continue to focus on enhancing cash flow for TriMas. And finally, we finished the quarter with a leverage ratio of 2.6 times, slightly higher than the same quarter last year but in line with the first quarter of 2024.

Thomas A. Amato: It is also important to note that we generated $11.4 million of free cash flow in this quarter, in line with last year, despite a lower base of absolute EBITDA, as we continue to focus on enhancing cash flow for TriMas. And finally, we finished the quarter with a leverage ratio of 2.6x, slightly higher than the same quarter last year but in line with the first quarter of 2024. At this point, I will now turn the call over to Scott, who will take us through TriMas' segment results. Okay, Scott?

Speaker Change: And finally, we finished the quarter with a leverage ratio of 2.6 times, slightly higher than the same quarter last year, but in line with the first quarter of 2024.

Scott Mell: At this point, I will now turn the call over to Scott, who will take us through TriMas' segment results.

Scott A. Mell: At this point, I will now turn the call over to Scott, who will take us through TriMas' segment results. Scott?

Scott Mell: Scott, thanks, Tom.

Scott A. Mell: Thanks, Tom. Let's turn to slide 6, and I will begin my review of our segment results serving with TriMas packages. Net sales in the quarter were $132 million as compared to $117 million for the prior year quarter, an increase of more than 12%. This year-over-year increase was primarily driven by organic growth for our dispensing enclosure products, which served the beauty and personal care and industrial end markets, which increased on an organic basis by 24% and 19%, respectively.

Scott Mell: Let's turn to slide six, and I will begin my review of our segment results serving with TriMas Packaging. Net sales in the quarter were 132 million, as compared to 117 million for the prior year quarter, an increase of more than 12%. This year-over-year increase was primarily driven by organic growth for our dispensing enclosure products, which served the beauty and personal care and industrial end markets, which increased on an organic basis 24% and 19%, respectively. It is great to see demand recovery in these important end markets. On a sequential quarter-over-quarter basis, net sales increased by approximately 4%.

Scott A. Mell: Net sales in the quarter were $132 million as compared to $117 million for the prior year quarter, an increase of more than 12 percent.

Scott A. Mell: This year-over-year increase was primarily driven by organic growth for our dispensing enclosure products, which served the beauty and personal care and industrial end markets, which increased on an organic basis 24% and 19% respectively.

Scott A. Mell: It is great to see demand recovery in these important markets. On a sequential quarter-over-quarter basis, net sales increased by approximately 4%. Operating profit for the quarter was $18.5 million, or 14% of sales, which on a margin basis is essentially flat versus Q1 of 2024, but down 470 basis points versus the prior year period. This year-over-year decline is primarily related to period-specific operating costs associated with increased demand for certain dispensing products. IT allocation costs of $1.1 million, which were accounted for within corporate costs in the prior year period, and a $2.6 million commercial settlement in Q2 of 2023, which did not repeat. However, considering the impact of these items. Proforma Q2 Adjusted Operating Profit would have been flat when compared to the prior year period, at approximately 15.5%.

Scott A. Mell: On a sequential quarter-over-quarter basis, net sales increased by approximately 4 percent.

Scott Mell: Operating profit for the quarter was 18.5 million or 14% of sales, which on a margin basis is essentially flat versus Q1 of 2024 but down 470 basis points versus the prior year period. This year-over-year decline is primarily related to period-specific operating costs associated with increased demand for certain dispensing products. IT allocation costs of 1.1 million, which were accounted for within corporate costs in the prior year period, and a 2.6 million dollar commercial settlement in Q2 of 2023, which did not repeat. Considering the impact of these items, pro forma Q2 adjusted operating profit would have been flat when compared to the prior year period at approximately 15.5%.

Scott A. Mell: Operating profit for the quarter was $18.5 million, or 14% of sales, which on a margin basis is essentially flat versus Q1 of 2024, but down 470 basis points versus the prior year period.

Scott A. Mell: to period-specific operating costs associated with increased demand for certain dispensing products.

Scott A. Mell: Considering the impact of these items, pro forma Q2 adjusted operating profit would have been flat when compared to the prior year period at approximately 15.5%.

Scott Mell: Adjusted EBDA was 26.7 million or 20.2% of net sales, a nominal increase of 500,000 when compared to Q1 of 2024. We remain very pleased with the sales momentum within dry mass packaging, with year-to-date organic sales up close to 10%, and expect our conversion rates to improve as we move through the second half of 2024, as we work through operational pinch points created by significantly higher customer order. Accordingly, we are increasing our full-year sales guidance for TriMas Packaging to 9-10% and tightening our full-year guidance for adjusted EBDA margins to 21-23%. Looking forward, we expect future growth for TriMas Packaging to be driven by continuing improvement in both general consumer and industrial demand, further expansion of our presence in new and emerging geographical markets such as South America, and growth and demand for our innovative new products within all of the end markets we serve.

Scott A. Mell: Adjusted EBDA was $26.7 million, or 20.2% of net sales, a nominal increase of $500,000 when compared to Q1 of 2024. We remain very pleased with the sales momentum within TriMas packaging with year-to-date organic sales up close to 10% and expect our conversion rates to improve as we move through the second half of 2024 as we work through operational pinch points created by significantly higher customer orders. Accordingly, we are increasing our full-year sales guidance for TriMas packaging to 9-10% and tightening our full-year guidance for adjusted EBITDA margin to 21-23%.

Scott A. Mell: Adjusted EBDA was $26.7 million or 20.2% of net sales, a nominal increase of $500,000 when compared to Q1 of 2024.

Scott A. Mell: We remain very pleased with the sales momentum within TriMas packaging.

Scott A. Mell: with year-to-date organic sales up close to 10% and expect our conversion rates to improve as we move through the second half of 2024 as we work through operational pinch points created by significantly higher customer orders.

Scott A. Mell: Accordingly, we are increasing our full-year sales guidance for TriMas packaging to 9-10% and tightening our full-year guidance for adjusted EBITDA margins to 21-23%.

Scott A. Mell: Looking forward, we expect future growth for TriMas packaging to be driven by continuing improvement in both general consumer and industrial demand, further expansion of our presence in new and emerging geographical markets such as South America, and growth and demand for our innovative new products within all of the end markets we serve. Turning to slide 7, I will now provide an update on our TriMas aerospace segment. Net sales for the quarter increased by almost 18 million, or 30%, when compared to the same period a year ago, as general aerospace volumes continue to recover, and we benefit from improved operational efficiencies and commercial recoveries associated with higher input costs.

Scott A. Mell: Looking forward, we expect future growth for TriMas packaging to be driven by continuing improvement in both general consumer and industrial demand.

Scott A. Mell: Further expansion of our presence in new and emerging geographical markets, such as South America, and growth and demand for our innovative new products within all of the end markets we serve.

Scott Mell: Turning to slide 7, I will now provide an update on our TriMas Aerospace segment. Net sales for the quarter increased by almost 18 million or 30% when compared to the same period a year ago, as general aerospace volumes continue to recover and we benefit from improved operational efficiencies and commercial recoveries associated with higher input costs. Acquisitions contributed 1.4 million of sales during the quarter, while organic sales increased by 16.5 million, or 27.6%, when compared to the previous year period. Operating profit for the quarter was 10.5 million or 13.5% of net sales, which represents a 730 basis point improvement when compared to the previous year period and a 290 basis point improvement when compared to Q1 of 2024.

Speaker Change: Turning to slide 7, I will now provide an update on our TriMas Aerospace segment.

Speaker Change: Net sales for the quarter increased by almost 18 million, or 30%, when compared to the same period a year ago.

Speaker Change: As general, aerospace volumes continue to recover and we benefit from improved operational efficiencies and commercial recoveries associated with higher input costs.

Scott A. Mell: Acquisitions contributed $1.4 million of sales during the quarter, while organic sales increased by 16.5 million, or 27.6%, when compared to the previous year period. Operating profit for the quarter was $10.5 million, or 13.5% of net sales, which represents a $730 basis point improvement when compared to the previous year period and a $290 basis point improvement when compared to Q1 of 2024. Adjusted EBITDA for the quarter was $15 million, or 19.4% of net sales.

Speaker Change: Acquisitions contributed $1.4 million of sales during the quarter, while organic sales increased by $16.5 million, or 27.6%, when compared to the previous year period.

Speaker Change: Operating profit for the quarter was $10.5 million or 13.5% of net sales, which represents a 730 basis point improvement when compared to the previous year period and a 290 basis point improvement when compared to Q1 of 2024.

Scott Mell: Adjusted EBDA for the quarter was 15 million, or 19.4% of net sales. Expanding a bit on the recent performance improvements for TriMas Aerospace. LTM sales for the second quarter of 2024 were approximately 34% higher than the rate we were at at the same point in 2023. In addition, LTM sales for TriMas Aerospace are now higher than the pre-cogred periods of 2019 when we exclude the impact of post-2019 acquisitions. While we are very pleased with this full-demand recovery, we do believe there is incremental margin opportunity within TriMas Aerospace as we continue to invest in manufacturing capacity and see further improvements in supply chain continuity.

Speaker Change: Adjusted EBITDA for the quarter was $15 million or 19.4% of net sales.

Scott A. Mell: Expanding a bit on the recent performance improvement for TriMas Aerospace, LTM sales for the second quarter of 2024 were approximately 34% higher than the rate we were at at the same point in 2023. In addition, LTM sales for TriMas Aerospace are now higher than the pre-COVID period of 2019 when we exclude the impact of post-2019 acquisitions. While we are very pleased with this full demand recovery, we do believe there is incremental margin opportunity within TriMas Aerospace as we continue to invest in manufacturing capacity and see further improvements in supply chain continuity.

Speaker Change: Expanding a bit on the recent performance improvement for TriMas Aerospace,

Speaker Change: LTM sales for the second quarter of 2024 were approximately 34% higher than the rate we were at at the same point in 2023.

Speaker Change: In addition, LTM sales for TriMas Aerospace are now higher than the pre-COVID period of 2019 when we exclude the impact of post-2019 acquisitions.

Speaker Change: While we are very pleased with this full demand recovery, we do believe there is incremental margin opportunity within TriMas aerospace as we continue to invest in manufacturing capacity and see further improvements in supply chain continuity.

Scott Mell: Accordingly, we are increasing our 4-year sales growth guidance to 18 to 22%, and 4-year guidance for adjusted EBDA margin to 18 to 19%.

Scott A. Mell: Accordingly, we are increasing our full-year sales growth guidance to 18% to 22% and full-year guidance for adjusted EBITDA margin to 18% to 19%. Now, on slide 8, let's review our specialty product segment. Net sales were $31 million, as compared to $56 million for the prior-year quarter, which was the highest quarterly sales performance ever for specialty products.

Speaker Change: Accordingly, we are increasing our full-year sales growth guidance to 18% to 22% and full-year guidance for adjusted EBITDA margin to 18% to 19%.

Scott Mell: Now on slide 8, let's review our specialty product segment. Net sales were 31 million as compared to 56 million for the prior year quarter, which was the highest quarterly sales performance ever for specialty products. This high demand rate in the first half of 2023 was driven by supply chain concerns, which led to elevated rates of ordering and resulting customer stock builds. Sales in the quarter continue to be negatively impacted largely by the overstocked position of industrial cylinders and, to a lesser extent, lower sales of compressor serving the oil and gas industry. In addition, sales of cylinders into defense-related applications have been deferred and are now not expected to run at a normalized rate until the start of 2025.

Speaker Change: Now on slide 8, let's review our specialty product segment.

Speaker Change: Net sales were $31 million, as compared to $56 million for the prior year quarter, which was the highest quarterly sales performance ever for specialty products.

Scott A. Mell: This high demand rate in the first half of 2023 was driven by supply chain concerns, which led to elevated rates of ordering and resulting customer stock bills. Sales in the quarter continued to be negatively impacted, largely by the overstock position of industrial cylinders and, to a lesser extent, lower sales of compressors serving the oil and gas industry. In addition, sales of cylinders for defense-related applications have been deferred, and they are now not expected to run at a normalized rate until the start of 2025.

Speaker Change: This high demand rate in the first half of 2023 was driven by supply chain concerns which led to elevated rates of ordering and resulting customer stock bills.

Speaker Change: Sales in the quarter continue to be negatively impacted, largely by the overstock position of industrial cylinders and, to a lesser extent, lower sales of compressors serving the oil and gas industry.

Speaker Change: In addition, sales of cylinders into defense-related applications have been deferred and are now not expected to run at a normalized rate until the start of 2025.

Scott Mell: While we continue to see some moderate improvement in our order books for steel cylinders and expect second half demand for steel cylinders to improve modestly over the first half run rate, we do not foresee at this point our previously expected second half demand recovery for these industrial businesses. And accordingly, we are revising our guidance for four-year sales decline for specialty products to 25 to 30%. Operating profit in the quarter was 0.6 million or 1.9 percent of net sales, while adjusted EBDA for the quarter was 1.7 million or 5.3 percent of net sales. I would like to mention that during the quarter, our cylinder business took advantage of the lower demand environment to complete two strategic initiatives, which, while critical to driving future operational performance improvement, further burdened profitability during the quarter.

Scott A. Mell: While we continue to see some moderate improvement in our order book for steel cylinders and expect second-half demand for steel cylinders to improve modestly over the first-half run rate, we do not foresee at this point our previously expected second-half demand recovery for these industrial businesses. And accordingly, we are revising our guidance for full-year sales decline for specialty products to 25 to 30 percent. Operating profit in the quarter was $0.6 million, or 1.9% of net sales, while adjusted EBDA for the quarter was $1.7 million, or 5.3% of net sales.

Speaker Change: While we continue to see some moderate improvement in our order book for steel cylinders and expect second-half demand for steel cylinders to improve modestly over the first-half run rate, we do not foresee at this point our previously expected second-half demand recovery for these industrial businesses.

Speaker Change: And accordingly, we are revising our guidance for full-year sales decline for specialty products to 25 to 30 percent.

Speaker Change: Operating profit in the quarter was $0.6 million or 1.9% of net sales, while adjusted EBDA for the quarter was $1.7 million or 5.3% of net sales.

Scott A. Mell: I would like to mention that during the quarter, our North Cillinger business took advantage of the lower-demand environment to complete two strategic initiatives, which, while critical to driving future operational performance improvement, further impacted profitability during the quarter. First, they completed the process of pivoting to a pull inventory system in response to structural shifts in customer delivery time expectations. Second, they completed significant and necessary repairs and maintenance to key manufacturing assets. We estimate that these two initiatives alone negatively impacted the quarter by $0.06 per share.

Speaker Change: I would like to mention that during the quarter, our North Cillinger business took advantage of the lower-demand environment to complete two strategic initiatives, which, while critical to driving future operational performance improvement,

Scott Mell: First, they completed the process of pivoting to a poll inventory system in response to structural shifts and customer delivery time expectations. Second, they completed significant and necessary repairs and maintenance to key manufacturing assets. We estimate that these two initiatives alone negatively impacted the quarter by six cents per share. As mentioned earlier by Tom, given second quarter performance in our tempered view of second half 2024 demand, we have begun to execute additional structural cost reductions within specialty products, while maintaining the necessary flexibility to respond to anticipated demand recovery, beginning in late 2024 or early 2025. In addition, we've recently engaged with the consultancy firm Stratagex to assess and implement strategic growth and profit enhancement opportunities within Nor Cylinder based on the 80-20 profit and growth model originally developed by Illinois Toolworks.

Speaker Change: Further burden profitability during the quarter.

Speaker Change: First, they completed the process of pivoting to a pull inventory system in response to structural shifts in customer delivery time expectations.

Speaker Change: Second, they completed significant and necessary repairs and maintenance to key manufacturing assets.

Speaker Change: We estimate that these two initiatives alone negatively impacted the quarter by $0.06 per share.

Scott A. Mell: As mentioned earlier by Tom, given second quarter performance and our tempered view of second half 2024 demand, we have begun to execute additional structural cost reductions within specialty products while maintaining the necessary flexibility to respond to anticipated demand recoveries beginning in late 2024 or early 2025. In addition, we have recently engaged with the consultancy firm Strategex to assess and implement strategic growth and profit enhancement opportunities within North Cylinder based on the 80-20 profit and growth model originally developed by Illinois Tool Works.

Speaker Change: As mentioned earlier by Tom, given second quarter performance and our tempered view of second half 2024 demand,

Tom: We have begun to execute additional structural cost reductions within specialty products, while maintaining the necessary flexibility to respond to anticipated demand recoveries beginning in late 2024 or early 2025.

Tom: In addition, we have recently engaged with a consultancy firm, Strategex.

Tom: to assess and implement strategic growth and profit enhancement opportunities within North Cylinder based on the 80-20 profit and growth model originally developed by Illinois Tool Works.

Scott Mell: While we expect these efforts to meaningfully improve our current conversion rates, they will take time to implement and be realized as financial performance. And accordingly, at this time, we are reducing our full-year guidance for adjusted EBDA margin for specialty products to 10 to 14%.

Scott A. Mell: While we expect these efforts to meaningfully improve our current conversion rates, they will take time to implement and be realized in financial performance. And accordingly, at this time, we are reducing our full-year guidance for adjusted EBITDA margin for specialty products to 10 to 14 percent. At this point, I'd like to turn the call back over to Tom to discuss our updated full year sales and adjusted EPS guidance and to provide some closing remarks.

Tom: While we expect these efforts to meaningfully improve our current conversion rates, they will take time to implement and be realized in financial performance.

Tom: And accordingly, at this time, we are reducing our full-year guidance for adjusted EBITDA margins for specialty products to 10 to 14 percent.

Scott Mell: At this point, I'd like to turn the call back over to Tom to discuss our updated full-year sales and adjusted EPS guidance and to provide some closing remarks. Tom, thank you, Scott. Let's turn to slide nine. Given the results in the second quarter and modified expectations related to our specialty product segments in the second half, we are revising our sales and EPS outlook for 2024. We now expect sales to be in the 4 to 6% range, with a center point slightly lower than originally planned. We're also revising our EPS range to $1.70 to $1.90, as compared to $1.95 to $2.15, as we anticipated to begin the year.

Tom: At this point, I'd like to turn the call back over to Tom to discuss our updated full year sales and adjusted EPS guidance and to provide some closing remarks. Tom?

Thomas A. Amato: Thank you, Scott. Now, let's turn to slide 9. Given the results in the second quarter and modified expectations related to our specialty product segment for the second half, we are revising our sales and EPS outlook for 2024. We now expect sales to be in the 4% to 6% range, with the center point slightly lower than originally planned. We're also revising our EPS range to $1.70 to $1.90 as compared to $1.95 to $2.15 as we anticipated to begin the year. Now, let's turn our attention to the summary bridge on the right of slide 9.

Tom: Thank you, Scott. Let's turn to slide 9.

Tom: Given the results in the second quarter and modified expectations related to our specialty product segment for the second half, we are revising our sales and EPS outlook for 2024.

Speaker Change: We now expect sales to be in the 4-6% range, with the center point slightly lower than originally planned.

Speaker Change: We are also revising our EPS range to $1.70 to $1.90 as compared to $1.95 to $2.15 as we anticipated to begin the year.

Thomas Amato: If we turn our attention to the summary bridge on the right of slide 9, you can see the discrete drivers of our change in our outlook. We do not show TriMas packaging on this bridge because we continue to estimate that this group will remain within our internal planning ranges for the year. With respect to TriMas Aerospace, this group is currently trending above our internal planning ranges for the year, and we continue to anticipate it will remain on track for the second half. While we now believe higher interest rates will be an undercurrent to our EPS forecast for the year, the main driver to our revised outlook is a different demand and recovery profile for our specialty products businesses than we anticipated for 2024.

Speaker Change: If we turn our attention to the summary bridge on the right of slide 9.

Thomas A. Amato: You can see the discrete drivers of our change in our out... We do not show TriMas packaging on this bridge because we continue to estimate that this group will remain within our internal planning ranges for the year. With respect to TriMas Aerospace, this group is currently trending above our internal planning ranges for the year, and we continue to anticipate it will remain on track for the second half. While we now believe higher interest rates will be an undercurrent to our EPS forecast for the year, the main driver of our revised outlook is a different demand and recovery profile for our specialty products businesses than we anticipated for 2024.

Speaker Change: You can see the discrete drivers of our change in our outlook.

Speaker Change: We do not show TriMas packaging on this bridge because we continue to estimate that this group will remain within our internal planning ranges for the year.

Speaker Change: With respect to TriMas Aerospace, this group is currently trending above our internal planning ranges for the year, and we continue to anticipate it will remain on track for the second half.

Speaker Change: While we now believe higher interest rates will be an undercurrent to our EPS forecast for the year, the main driver to our revised outlook is a different demand and recovery profile for our specialty products businesses than we anticipated for 2024.

Thomas Amato: Before moving to Q&A, I'll conclude a prepare remarks by refreshing the near and long-term value creating opportunities set for TriMas. First, our two largest operating groups, TriMas Packaging and TriMas Aerospace, which together represent nearly 85% of our LTM sales, are at different stages of performance recovery after a very challenged 2023. We anticipate that the positive momentum of these high-quality business lines will carry into 2025 and will be on. Next, while our specialty products businesses have experienced significant challenges in this period, we have already completed many actions that are not yet financially benefiting the group, but which we expect to do so as we move through 2024 and into 2025.

Thomas A. Amato: Before moving to Q&A, I will conclude our prepared remarks by refreshing the near and long-term value creation opportunity set for TriMas. Our two largest operating groups, TriMas Packaging and TriMas Aerospace, which together represent nearly 85% of our LTM sales, are at different stages of performance recovery after a very challenging 2023. We anticipate that the positive momentum of these high-quality business lines will carry into 2025 and well beyond. Next, while our specialty products businesses have experienced significant challenges in this period, we have already completed many actions that are not yet financially benefiting the group, but which we expect to do so as we move through 2024 and into 2025.

Speaker Change: Before moving to Q&A, I will conclude our prepared remarks by refreshing the near and long-term value creating opportunity set for TriMas.

Speaker Change: First,

Speaker Change: Our two largest operating groups, TriMas Packaging and TriMas Aerospace, which together represent nearly 85% of our LTM sales, are at different stages of performance recovery after a very challenged 2023.

Speaker Change: We anticipate that the positive momentum of these high-quality business lines will carry into 2025 and well beyond.

Speaker Change: Next.

Speaker Change: While our specialty products businesses have experienced significant challenges in this period,

Speaker Change: We have already completed many actions that are not yet financially benefiting the group.

Thomas A. Amato: Moreover, as we expect to experience demand reversion when it occurs, we should do well in our specialty products businesses. Finally, we continue to take steps to focus and improve our portfolio of businesses. We have already announced the planned divestiture of our aero engine business, which would facilitate TriMas' exit from our presence in the oil and gas end market.

Speaker Change: But what we expect to do so is we move through 2024 and into 2025.

Thomas Amato: Moreover, as we expect to experience demand reversion, when it occurs, we should convert well in our specialty products businesses. Finally, we continue to take steps to focus and improve our portfolio of businesses. We have already announced the plan to best the sure of our era engine business, which would facilitate TriMas' exit of our presence in the oil and gas end market. We also place a priority on building out our TriMas packaging platform through M&A, with a focus on the life sciences, beauty, and food and beverage end markets. Secondly, building out our TriMas aerospace platform through strategic acquisitions to enhance its long-term value.

Speaker Change: Moreover, as we expect to experience demand reversion, when it occurs, we should convert well in our specialty products businesses. Finally, we continue to take steps to focus and improve our portfolio of businesses.

Speaker Change: We have already announced the planned divestiture of our aero engine business, which would facilitate TriMas' exit of our presence in the oil and gas end market.

Sherry Lauderback: We also place a priority on building out our TriMas packaging platform through M&A, with a focus on the life sciences, beauty, and food and beverage end markets. And secondarily, building out our TriMas aerospace platform through strategic acquisitions to enhance its long-term value. I would like to again thank our investors for their continued interest and support and will now turn the call back to Sherry. Thanks, Tom. At this point, we would like to open the call up for questions. Thank you.

Speaker Change: We also place a priority on building out our TriMas packaging platform through M&A with a focus on the life sciences, beauty, and food and beverage end markets.

Speaker Change: and secondarily, building out our TriMas aerospace platform through strategic acquisitions to enhance its long-term value.

Sherry Lauderback: I would like to again thank our investors for their continued interest and support, and we'll now turn the call back to Sherry.

Speaker Change: I would like to again thank our investors for their continued interest and support and will now turn the call back to Sherry. Sherry? Thanks, Tom. At this point, we would like to open the call up for questions.

Sherry Lauderback: Sherry? Thanks, Tom.

Sherry Lauderback: At this point, we would like to open the call-up for questions. Thank you.

Operator: We will now be conducting a question-answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the queue. You may press star 2 if you would like to remove your question from the queue.

Operator: We will now be conducting a question-and-answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key. One moment, please. We'll pull for questions.

Speaker Change: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad.

Speaker Change: A confirmation tone will indicate that your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key.

Operator: For participants using speaker equipment, it may be necessary to pick up your handset before pressing the start key. One moment, please, while we poll for questions. Our first question comes from Ken Newman with KeyBank Capital Markets. Please proceed with your question. Hey, good morning, guys. Good morning, Ken.

Speaker Change: One moment, please, while we poll for questions.

Ken Newman: Our first question comes from Ken Newman with KeyBank Capital Markets. Please proceed with your question. Thank you.

Speaker Change: Our first question comes from Ken Newman with KeyBank Capital Markets. Please proceed with your question.

Ken Newman: Good morning, Ken. Morning.

Ken Newman: Hey, good morning, guys.

Thomas Amato: So maybe just to start off, I mean, I think one of your investors has been a bit more vocal about trying to advocate for portfolio changes to improve performance in the overall company. Obviously, the performance at a specialty of this quarter was disappointing, but I'm curious if that performance of this quarter has changed your way of thinking around what the ultimate portfolio could look like longer-term. Well, good. You know, thank you for the question. We are very well aware of public statements made by Barrington and their investment in the company. And certainly, we appreciate all constructive feedback from all of our investors.

Speaker Change: Good morning, Ken.

Thomas A. Amato: So maybe just to start off, I think one of your investors has been a bit more vocal about trying to advocate for portfolio changes to improve the performance of the overall company. Obviously, the performance out of specialty this quarter was disappointing, but I'm curious if that performance this quarter has changed your way of thinking around what the ultimate portfolio could look like longer term. Well, you know, thank you for the question. We are very well aware of public statements made by Barrington and their investment in the company.

Speaker Change: Morning.

Speaker Change: So, maybe just to start off, I mean, I think one of your investors has been a bit more vocal about, you know, trying to advocate for portfolio changes to improve performance of the overall company.

Speaker Change: Obviously, the performance out of specialty this quarter was disappointing, but I'm curious if that performance this quarter has changed your way of thinking around what the ultimate portfolio could look like longer term.

Speaker Change: Well, thank you for the question. We are very well aware of public statements made by Barrington.

Thomas A. Amato: And certainly, we appreciate all constructive feedback from all of our investors. I wouldn't say it necessarily changed our thinking strategically related to this quarter specifically. What happened this quarter has changed our actions and some of the focus that we placed within our specialty products businesses. But if you think about specialty products generally today, one of the businesses in that group is already being marketed for sale, and we're working through that process.

Speaker Change: and their investment in the company. And certainly we appreciate all constructive feedback from all of our investors. I wouldn't say it necessarily changed our thinking strategically related to this quarter specifically.

Thomas Amato: I wouldn't say it necessarily changed our thinking strategically related to this quarter specifically. What occurred this quarter has changed our actions and some of the focus that we placed within our specialty products businesses. But if you think about specialty products, you know, generally today, one of the businesses in that group is already, you know, being marketed for sale, and we're working through that process. And that'll be one step in focusing our portfolio. But at this moment, our, you know, sort of what's moved up in terms of the priority list operationally, is ensuring we turn around our norris cylinder business, which, as I mentioned, we know at this base rate of sales, we can perform much better.

Speaker Change: What occurred this quarter has changed our actions.

Speaker Change: and some of the focus that we've placed within our specialty products businesses. But if you think about specialty products, you know, generally today, one of the businesses in that group is already, you know, being marketed for sale and we're working through that process. And that'll be one step in focusing our portfolio.

Thomas A. Amato: And that will be one step in focusing our portfolio. But at this moment, sort of what's moved up in terms of the priority list operationally is ensuring we turn around our North Cylinder business, which, as I mentioned, we know at this base rate of sales, we can perform much better. Right. Just, I guess, as a clarification question. I think a quarter or two quarters ago, you had mentioned this expectation to fold Norris into the packaging segment. Is that still your intention, or is that now no longer the case, given how dilutive it would be? Yeah, I would say that that's on hold given the development of the Norris cylinder this quarter.

Speaker Change: But at this moment, sort of what's moved up in terms of the priority list operationally is ensuring we turn around our Norris Cylinder business, which as I mentioned, we know at this base rate of sales, we can perform much better.

Thomas Amato: Right. Just I guess as a clarification question, I think a quarter or two quarters ago, you had mentioned this expectation to fold in Norris into the packaging segment. Is that still your intention, or is that now no longer the case, given how diluted it would be? Yeah, I would say that's on hold given the development of Norris cylinder this quarter. Yep.

Speaker Change: Right.

Speaker Change: Just I guess as a clarification question, I think a quarter or two quarters ago you had mentioned this expectation to fold in Norris into the packaging segment. Is that still your intention or is that now no longer the case given how dilutive it would be?

Speaker Change: Yeah, I would say that's on hold given the developments in the North Cylinder this quarter.

Thomas A. Amato: Yep. Uh, okay, and then for my follow-up here, um... just on North Cylinder. I understand the visibility is limited, but I'm just curious.

Thomas Amato: Okay. And then from a follow-up here, on Norris cylinder, I understand the visibility is limited. But I'm just curious what your customers are saying from an inventory perspective? Where are days inventory? And just how do you view the visibility within that channel and getting comfortable with the recovery in that market? Yeah. It's a good question. It's obviously one we've spent spending a lot of time on, certainly over the past several weeks.

Speaker Change: Yep.

Speaker Change: Okay, and then for my follow-up here...

Speaker Change: On Norris Cylinder.

Thomas A. Amato: What your customers are saying from an inventory perspective, where are the days of inventory, and how do you view the visibility within that channel and getting comfortable with the recovery in that market? Yeah, it's a good question. It's obviously one we've spent a lot of time on, certainly over the past several weeks. And although we've experienced this in each of our businesses, right, over the course of the past few years, we believe what's occurred at Norris is a little bit more unique.

Speaker Change: I understand the visibility is limited, but I'm just curious, what your customers are saying from an inventory perspective, where are days inventory, and just how do you view the visibility within that channel and getting comfortable with the recovery in that market?

Speaker Change: Yeah, it's a good question. It's obviously one we've been spending a lot of time on, certainly over the past several weeks, and it's...

Thomas Amato: And it's, it's, although we've experienced this in each of our businesses right over the course of the past few years, we believe what's occurred at Norris is a little bit more unique. And when we look at our largest set of customers, some have clearly an overstocked position. And some of that related to much of that related to buying patterns in 2023 when there was a very it was very difficult to get material and any steel goods. And we saw this in our aerospace business as well. We were the ones that were securing all the raw material we could.

Speaker Change: Although we've experienced this in in each of our businesses right over the course of the past few years, we believe what's occurred at Norris is a little bit more unique and when we look at our largest

Thomas A. Amato: And when we look at our largest set of customers, some have clearly an overstocked position, and much of that related to buying patterns in 2023 when it was very difficult to get material and any steel goods. We saw this in our aerospace business as well. We were the ones that were securing all the raw materials we could.

Speaker Change: Set of customers

Speaker Change: Some

Speaker Change: have clearly an overstocked position.

Speaker Change: and much of that related to buying patterns in 2023 when it was very difficult to get material and any steel goods. We saw this in our aerospace business as well. We were the ones that were securing all the raw material we could.

Thomas A. Amato: Another larger customer of ours is in a channel where it's government-related, and the spending allocation, you know, we think it's delayed possibly because of the election, possibly because of other factors. We still think the demand will be there, but we don't expect that demand to start to occur until later in the year and into next year. But, you know, we do expect that demand to revert.

Thomas Amato: Another larger customer virus is in a channel where it's government related and the spending allocation, you know, we think is delayed possibly because of the election, possibly because of other factors. We still think the demand will be there, but we don't expect that demand probably to start to occur until later in the year and into next year. But we do expect that demand to revert. And then another large customer virus certainly has been shopping for different price point products. And while they may not be in the complete overstocked position, we're working to get more share of that customer back, but it's a long-term customer.

Speaker Change: Another larger customer of ours is...

Speaker Change: in a channel where it's government related and the spending allocation

Speaker Change: We think it's delayed possibly because of the election, possibly because of other factors. We still think the demand will be there, but we don't expect that demand probably to start to occur until later in the year and into next year. But we do expect that.

Thomas A. Amato: And then another large customer of ours certainly has been shopping for different price point products. And while they may not be in a complete overstock position, you know, we're working to get more share of that customer back. But it's a long-term customer, and what tends to happen in our Norris Cylinder business is share movement from time to time based on market pricing. It's a little bit, you know, it's a little bit like a.., something you might see with chemical companies. Understood. If you don't mind, maybe I can just squeeze one last one in here for packaging.

Speaker Change: that demand to revert.

Speaker Change: and then another large customer of ours certainly has been shopping for different price point products.

Speaker Change: And while they may not be in the complete overstock position, we're working to get more share of that customer back, but it's a long-term customer, and what tends to happen in our Norris Cylinder business...

Thomas Amato: And what tends to happen in our Norris cylinder business is share movement from time to time based on market pricing. It's a little bit, you know, it's a little bit like something you might see with chemical come.

Speaker Change: is share movement from time to time based on market pricing. It's a little bit like something you might see with chemical companies.

Thomas Amato: Understead.

Ken Newman: If you don't mind, maybe I can just squeeze one last one in here on packaging. Yep, pretty obviously. The growth in your water rate sounds pretty positive here. Maybe if you just help us think about, you've got a tough comp this next quarter, and then maybe a seasonally easier quarter in the fourth quarter. So let's think about the cadence there, and then longer term.

Speaker Change: Understood.

Speaker Change: If you don't mind, maybe I can just squeeze one last one in here on packaging. Obviously, the growth in the order rates sound pretty positive here.

Thomas A. Amato: Obviously, the growth in the order rates sounds pretty positive here. Maybe if you could just help us think about it, you've got a tough comp this next quarter and then maybe a seasonally easier quarter in the fourth quarter. Just help us think about the cadence there, and then, longer term, how do you think about the longer term EBIT margin potential for that segment? Well, you know, I'm going to take the second part of that question, and then, you know, Scott will look at the quarterly comps and jump in.

Speaker Change: Maybe if you could just help us think about, you've got a tough comp this next quarter, and then maybe a seasonally easier quarter in the fourth quarter, just help us think about the cadence there, and then longer term.

Thomas Amato: How do you think about the longer term, EBIT margin potential for that segment, given all the moving pieces?

Speaker Change: How do you think about the longer term EBIT margin potential for that segment given all the moving pieces?

Thomas Amato: Well, I'm going to take the second part of that question, and then Scott will look at the quarterly caps and jump in. We know we are not performing at the conversion rate that is our true potential, and we know the reasons why. And interestingly, what we saw in aerospace across the board, we do have some of those hotspots within our packaging business. Specifically, there's some products that we're supplying where very important customers are pulling above our capacity rates. And when that happens, you run over time; you have expedited freight; there's a lot of off-standard costs that are impacting your business.

Speaker Change: Well, you know, I'm going to take, I'll take the second part of that question and then, you know, Scott will look at the quarterly comps and jump in.

Thomas A. Amato: You know, we know we are not performing at the rate conversion rate that is our true potential, and we know the reasons why. And, you know, interestingly, like what we saw in aerospace across the board, we do have some of those hot spots within our packaging business. Specifically, there are some products that we're supplying where very important customers are pulling above our capacity rates. And when that happens, you know, you run overtime, you have expedited freight, there's a lot of off-standard costs that are impacting your business. Now, we have, we saw this coming.

Speaker Change: We know we are not performing at the conversion rate that is our true potential, and we know the reasons why.

Scott A. Mell: Interestingly, what we saw in aerospace across the board, we do have some of those hot spots within our packaging business, specifically, there's some products that we're supplying

Scott A. Mell: where very important customers are pulling above our capacity rates.

Scott A. Mell: And when that happens, you know, you run overtime, you have expedited freight, there's a lot of off-standard costs that are impacting your business. Now, we have, we saw this coming.

Thomas Amato: Now, we saw this coming. We have capacity that is coming online towards the end of the year, and that will relieve some of that pressure, probably all that pressure, and allow us to improve our performance as we move into 2025 and beyond. But when I look at the business, and I look at the profile and the full opportunity said, I mean, we're at least in the nearer terms, sort of into 2025, we're at least 200 bits below where our potential should be in the nearer term.

Thomas A. Amato: We have capacity that is coming online towards the end of the year, and that will relieve some of that pressure, probably all of that pressure, and allow us to improve our performance as we move into 2025 and beyond. But when I look at the business and I look at sort of the profile and the full opportunity set, I mean, we're, at least in the nearer term, sort of into 2025, at least 200 bits below where our potential should be in the near term. Scott, I'll let you answer some quarterly questions if you want. Yeah, Ken, hi.

Scott A. Mell: We have capacity that is coming online towards the end of the year.

Scott A. Mell: and that will relieve some of that pressure.

Scott A. Mell: probably all of that pressure and allow us to...

Scott A. Mell: and the full opportunity set.

Scott A. Mell: I mean, we're at least in the nearer term, sort of into 2025, we're at least 200 bits below where our potential should be in the nearer term. Scott, I'll let you answer some quarterly questions if you want.

Scott Mell: Scott, I'll let you answer some quarterly questions if you want.

Scott Mell: Yeah, Ken, was that question on aerospace or packaging? Packaging. Yeah, I mean, look, I think we expect to see, you know, similar quarterly year-over-year growth for the second half of the year. I mean, if you look at the guidance for the full year, you know, you can kind of back into what we're anticipating for the second half of the year. You know, it's going to be, you know, in that same range around, you know, 10% year-over-year sales growth is what we're anticipating for the second half of the year. Yep, that's helpful.

Scott A. Mell: Was that question on aerospace or packaging? Packaging. Packaging.

Scott A. Mell: Yeah, Ken, hi. Was that question on aerospace or packaging? Packaging. Packaging. Yeah, I mean, look, I think we...

Scott A. Mell: Yeah, I mean, look, I think we're expecting to see similar quarterly year-over-year growth for the second half of the year. I mean, if you look at the guidance for the full year, you can kind of back into what we're anticipating for the second half of the year. It's going to be in that same range around 10% year-over-year sales growth is what we're anticipating for the second half of the year.

Scott A. Mell: We expect to see, you know, similar quarterly year-over-year growth for the second half of the year. I mean, if you look at the guidance for the full year, you know, you can kind of back into what we're anticipating for the second half of the year. You know, it's going to be, you know, in that same...

Scott A. Mell: range around 10% year-over-year sales growth is what we're anticipating for the second half of the year.

Scott A. Mell: Yep, that's helpful. I appreciate it. Thank you, Ken.

Ken Newman: I appreciate it.

Scott A. Mell: Yep, that's helpful, I appreciate it.

Ken Newman: Okay, thank you, Ken.

Ken Newman: Thank you, Ken.

Hamed Khorsand: Our next question comes from Hamid Kursan with the AWS Financial. Please proceed with your question.

Operator: Our next question comes from Hamed Khorsand with BWS Financial. Please proceed with your question. Hey, good morning.

Speaker Change: Our next question comes from Hamed Khorsand with BWS Financial. Please proceed with your question.

Thomas Amato: Hi, good morning. So first question I had was lip-to-packaging. You guys last year, you know, emphasized, you know, capacity being taken off. And now you're saying that you know you're hitting capacity bottlenecks and issues. So why did why did that happen? What's different from that? What you did last year to what's being ordered this year? And why are you now, you know, talking about bringing on capacity? Yeah, it just seems like everything's gone around. Yeah, Hamed, that's a good question. It's a fair question. We did not take capacity out last year. We repositioned capacity. So specifically what you're referring to is operational changes we made in a very low demand market to reposition physical assets into any more concentrated location for our caps and closure product lines.

Hamed Khorsand: So the first question I had was related to packaging. You guys last year emphasized capacity being taken off. And now you're saying that you're hitting capacity bottlenecks and issues. So why did that happen? What's different from what you did last year to what's being ordered this year and why are you now, you know, talking about bringing on capacity? Yeah, it just seems like everything's going around. Yeah, Hamed, that's a good question. It's a fair question,

Hamed Khorsand: Hi, good morning. So first question I had was related to packaging.

Hamed Khorsand: You guys last year emphasized capacity being taken off, and now you're saying that you're hitting capacity bottlenecks and issues. So why did that happen?

Speaker Change: What's different from that what you did last year to what's being ordered this year? And why are you now you know talking about bringing on capacity? It just seems like everything's going around.

Speaker Change: Yeah, Hamed, that's a good question. It's a fair question.

Thomas A. Amato: We did not take capacity out last year; we repositioned it. So specifically, what you're referring to are operational changes we made in a very low-demand market to reposition physical assets in a more concentrated location for our caps and closure product lines. So that's a very different product line from where we're experiencing pinch points today, which are predominantly in our dispenser product line. So these are different movements of capacity for different product lines.

Speaker Change: We did not take capacity out last year.

Speaker Change: We repositioned capacity, so specifically what you're referring to is

Speaker Change: operational changes we made in a very low-demand market to reposition physical assets into a more concentrated location.

Thomas Amato: So that's a very different product line where we're experiencing pinch points today, which are predominantly in our dispenser product lines. So these are different movements of capacity for different product lines. So what's affecting us this quarter, which is in a strange way a high-class problem, because we've experienced most of 2023 a significant reduction in demand in our dispenser product line, predominantly related to overstocked positions, and now that demand is coming back in a robust way, and that's where we have pinch points. But what we referred to last year related to movement of assets, and we closed a plant in California and moved those assets into the Midwest on a closure product line.

Speaker Change: for our

Speaker Change: Caps and Closure product line. So that's a very different product line.

Speaker Change: where we're experiencing pinch points today, which are predominantly in our dispenser product line. So, these are different movements of capacity for different product lines. So, what's affecting us this quarter...

Thomas A. Amato: So what's affecting us this quarter, which is, you know, which is, in a strange way, you know, a high class problem, because we have experienced, for most of 2023, a significant reduction in demand for our dispenser product line, predominantly related to overstock positions. And now that demand is coming back in a robust way. And that's where we have pinch points.

Speaker Change: which is, you know, which is...

Speaker Change: in a strange way.

Speaker Change: you know, a high-class problem because we have

Speaker Change: We've experienced most of 2023 a significant reduction in demand in our dispenser product line, predominantly related to overstocked positions.

Speaker Change: and now that demand is coming back in a robust way.

Thomas A. Amato: But what we referred to last year related to the movement of assets, and we closed a plant in California and moved those assets into the Midwest on a closure product line. So, very different products. That's helpful. And then as far as the guidance is concerned for packaging and lining it up with what's been reported, what you're saying, it seems like the second half revenue or sales would be down modestly versus first half sales. And I'm just trying to understand what the seasonality is.

Speaker Change: And that's where we have pinch points.

Speaker Change: But what we referred to last year related to movement of assets, and we closed a plant in California and moved those assets into the Midwest on a closure product line, so very different products.

Thomas Amato: So very different products.

Scott Mell: That's helpful, and then as far as the guidance is concerned for packaging and lining it up with what's been reporting, what you're saying it seems like the second half revenue or sales would be down modestly versus first half sales. I'm just trying to understand what the seasonality is and, again, why doesn't that coordinate with the commentary that business is doing well and packaging. Yeah, I think that's primarily related just naturally to the cyclicality of our business. Specifically, as it relates to the fourth quarter of the year, you know we tend to see a bit lower order pattern as we get toward the holiday season. But, you know, back to my point to Ken, we still expect the second half of the year, you know, on a year-to-year basis, to be up relative to the prior year, so nothing's surprising there other than just a natural, you know, order pattern cyclicality of our business.

Speaker Change: That's helpful and then as far as the

Speaker Change: guidance is concerned for packaging and lining it up with what's been reported, what you're saying. It seems like the second half revenue or sales would be down modestly versus first half sales.

Scott A. Mell: Again, why doesn't that coordinate with the commentary that business is doing well? Yeah, I think that's primarily related just, naturally, to the cyclicality of our business, specifically as it relates to the fourth quarter of the year. We tend to see a bit lower order pattern as we get toward the holiday season, but back to my point to Ken, we still expect the second half of the year on a year-over-year basis to be up relative to the prior year.

Speaker Change: And I'm just trying to understand what the seasonality is and, again, why doesn't that coordinate with the commentary that, you know, business is doing well in packaging.

Speaker Change: Yeah, I think that's primarily related just...

Speaker Change: naturally to the cyclicality of our business.

Speaker Change: specifically as it relates to the fourth quarter of the year. You know, we tend to see a bit lower order pattern as we get toward the holiday season. But, you know, back to my point to Ken, we still expect the second half of the year

Speaker Change: you know, on a year-over-year basis to be up relative to the prior year. So, nothing surprising there other than just the natural, you know, order, pattern, cyclicality of our business.

Scott A. Mell: So nothing surprising there other than just the natural order pattern cyclicality of our business. Got it, and my last question is on aerospace, what's your exposure, if anything, to what's going on with Airbus and anything about the inventory. Okay, well, look, both Boeing and Airbus are collectively very important and large customers, both directly through distribution and through tier ones.

Hamed Khorsand: And my last question is on aerospace.

Speaker Change: Got it. And my last question is on aerospace. What's your exposure, if anything, to what's going on with Boeing, Airbus, and anything about inventory and production lines being delayed?

Thomas Amato: What's your exposure, if anything, to what's going on with Boeing and Airbus and anything about the inventory and the production lines being delayed? Okay, well, look, both Boeing and Airbus are collectively very important and large customers, both directly through distribution and through tier ones, so naturally we're tied very much to their success. What I would say about some of the, you know, announcements related to this year specifically, we don't expect that to have much of an impact on us because, you know, we're already booked into next year and we have a backlog we're still working through. So, you know, we're, you know, what's on our build schedule is very likely to change at all as we line up our production planning for the balance of the year. Great.

Speaker Change: Okay, well, look, both Boeing and Airbus are collectively very important and large customers both directly.

Thomas A. Amato: So naturally, we're tied very much to their success. What I would say about some of the, you know, announcements related to this year, specifically, we don't expect that to have much of an impact on us because, you know, we're already booked into next year and we have a backlog we're still working through. So, you know, we're, you know, what's on our build schedule is it's not very likely to change at all as we line up our production planning for the balance of the year.

Speaker Change: through distribution and through Tier 1s. So, naturally...

Speaker Change: were tied very much to their success.

Speaker Change: What I would say about some of the announcements related to this year specifically, we don't expect that to have much of an impact on us because

Speaker Change: You know, we're already booked into next year and we have a backlog we're still working through. So, you know, we're, you know,

Speaker Change: What's on our build schedule is it's very likely to change at all as we line up our production planning for the balance of the year.

Thomas A. Amato: Great. I appreciate it. Thank you. Thank you, Hamed.

Hamed Khorsand: I appreciate it.

Hamed Khorsand: Thank you.

Operator: Thank you, Ahmed. It appears there are no further questions at this time.

Speaker Change: Great, I appreciate it. Thank you.

Alvin: Thank you, Hamed.

Operator: It appears there are no further questions at this time. I would now like to turn the floor back over to management for closing comments. Okay, operator, is it turned back to us? Yes, it appears that there are no further questions at this time. Okay, great. Thank you for joining us on our earnings call. We look forward to updating you again next quarter.

Operator: I would now like to turn the floor back over to management for Khorsand Oh. Okay. Operator. Is it turned back to us? Yes. It appears that there are no further questions at this time. Okay. Great.

Speaker Change: It appears there are no further questions at this time. I would now like to turn the floor back over to Management for closing comments.

Speaker Change: Okay, operator, is it turned back to us?

Operator: Yes, it appears that there are no further questions at this time.

Operator: Thank you for joining us on our earnings call. We look forward to updating you again next quarter. This includes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

Speaker Change: Okay, great. Thank you for joining us on our earnings call, and we look forward to updating you again next quarter.

Operator: This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation. BF-WATCH TV 2021, [inaudible] www.trimas.co.uk, The Ultimate Parody Site! Title: Microsoft Office Word Document MSWordDoc Word.

Speaker Change: This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

Document.8, [inaudible] The Ultimate Parody Site! BF-WATCH TV 2021, [inaudible] transcript Emily Beynon, The Ultimate Parody Site! BF-WATCH TV 2021, The Ultimate Parody Site! [inaudible] The Ultimate Parody Site! [inaudible] The Ultimate Parody Site! www.trimas.co.uk BF-WATCH TV 2021, [inaudible] The Ultimate Parody Site! Thomas Amato, Larry Bland, Sherry Lauderback, Katie Fleischer, Ken Newman, TriMas Corp, https://www.youtube.com.au [inaudible] Thomas Amato, Larry Bland, Scott Mell, Sherry Lauderback, Katie Fleischer, Ken Newman, TriMas Corp BF-WATCH TV 2021, [inaudible]..................... The Ultimate Parody Site! [inaudible] The Ultimate Parody Site! [inaudible] The Ultimate Parody Site!

Speaker Change: [inaudible]

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Speaker Change: Thank you for watching and don't forget to like and subscribe!

Speaker Change: Thank you for watching and don't forget to like and subscribe!

Speaker Change: ?? ?? ?? ??

Speaker Change: [inaudible] © B述 Е. В. Е., personal information.