Good afternoon, everybody. For those who I haven't met, I'm Cherilyn Radbourne, and I'm part of the research team here at TD Cowen. This afternoon, it's my pleasure to be hosting a fireside chat with ATS Corporation. Joining me from ATS, I wanna welcome Ryan McLeod, the company's Chief Financial Officer. Welcome, Ryan, and thank you for joining us for Sustainability Week. Thank you, Cherilyn, for hosting. Very excited to be here. Just before we get started, for the audience, you can ask questions by clicking the button in the top right-hand side of your screen, or you can also email me directly if you'd prefer. So maybe, Ryan, just to get started, for those on the line who may be somewhat less familiar with ATS, could you just give us an outline of the company's business and its scope and size? Yeah, of course. I mean, to start, we're a CAD 3 billion revenue company. You know, we've grown a little over 19% CAGR over the last five years. We've got about 7,000 employees, and we serve a global customer base, so we've got a presence in 20 countries, 65 manufacturing facilities, over 85 sales, service, and engineering offices. And what we do is we provide automation solutions for our customers that really help bring their products to market. So, you know, today, roughly half our business is in life sciences. That includes medical devices, pharma, radiopharmaceuticals. We also operate in the food and beverage space, so that's primary and secondary processing of food, inspection, sorting, yield control. Energy is another market we're in. And for us, again, sort of on theme today is clean energy, so primarily nuclear and grid battery storage. In transportation, we're primarily involved in electric vehicles in some of that transition of that market. And then consumer goods is our last vertical market, and that is warehouse automation, personal care, cosmetics, and durable goods. And so, as I said, we provide highly engineered automation systems, machines, products, services to our customers, and that helps them bring their products to market, fast, efficiently, and importantly, at the highest level of quality. Maybe just to build on that, for those who aren't aware, the company's current CEO joined in early calendar 2017, and the company's market emphasis has changed a lot, since that time. Ryan, maybe you could speak to kind of the evolution and the strategic rationale, behind it. Yeah, so, I mean, since Andrew joined, we really do start with a focus on our end markets. And, you know, that focus has been on building out business capabilities in markets that have good long-term growth, that are more resilient, less cyclical markets. So again, life sciences is a great example of this. Regulated food, both highly resilient markets, that also have good long-term attractive growth rates. We're also looking for applications, markets, or subverticals that have high consequence of failure, so, put another way, where customers are really focused on quality. Life sciences, again, really lends itself well to this. Customers in that space are always gonna be focused on quality as really their top priority. These are also typically higher-margin products for our customers. So, you know, they're meeting important needs in their market, so life sciences are our solutions. Like I said, they enable our customers to bring products to market that help people live longer, healthier lives. In food, our solutions provide access to safe, high-quality food for millions of people around the world. In energy, our solutions are helping to provide clean energy to millions of people. And then in transportation, what we're doing in battery pack and module assembly is helping to transform and decarbonize the automotive industry. So they're attractive markets. We generally have good tailwinds in them that support growth, including customers looking to advance their own sustainability goals and agendas. So the company just completed its fiscal 2024 year-end as of the end of March, so it feels natural to kind of ask you if you could elaborate on some of the strategic priorities that the company advanced last year, and what the key focus items are for the current fiscal year. Yeah, that, I mean, so we, you know, we're a March year, and so we just closed off our fiscal 2024 reporting. Again, at a high level, our revenues grew almost 18%, organic was almost 11% growth, and we had record profitability. So, you know, we're quite proud of the year we just closed off. Some of the areas we've been focused on, our after-sales service business, growing that. It's a high-value piece of the business, both from a customer and shareholder perspective. That we've continued to build out. We were up 20% year-over-year, yet 13-ish% organic growth in that business. We've continued to advance our M&A agenda. We completed four acquisitions last year, in life sciences and services, digital, all of which bring new capabilities to ATS. We've continued to invest internally in innovation, and are seeing benefits from those efforts. Early last year, we completed we became a dual-listed company, completed our U.S. IPO on the New York Stock Exchange, which was an exciting milestone for the company. And I should also mention, you know, Cherilyn, and we have a real and we've talked about this many times, we have a real focus on people. We've got a very highly educated workforce, very engaged, and we finished the year with a turnover rate of just under 5%. And that's a metric we're very focused on, and one we're very proud of as well. Great. To the extent that the business encountered any challenges during fiscal 2024, can you talk about how the company adapted to those? Yeah. So, I mean, I'll start with the supply chain. We've seen challenges there over the last 18-24 months, and that's an area that. So we operate in a decentralized structure, but one area where we do have, we've invested in a corporate supply chain team that really oversees all of that activity and helps coordinate and drive benefits across the organization of a consolidated entity. And so through that capability, that team has operated very well, but it's been a challenge. We've seen extended lead times, which is a challenge for us in a project-based business. We've seen higher-than-normal price inflation, so. But we've been able to offset a lot of that challenge through a lot of that investment we've made over a number of years. And the original intent of that group was to help drive margin expansion, and so in a more challenging environment, that capability served us very well. The other area of challenge has been more recently in the EV market, and we have seen some headwinds, so some of those customers have slowed down on investments. And really, they're focused on a couple of areas. They're continuing to develop and build out their technology, so looking to develop solutions that are more efficient, more reliable in terms of range, power output, and also focused on efficiency in their operations, so getting more out of their existing production processes to drive efficiency and profitability in their operations. So, you know, that along with the slowing consumer demand has caused some slowdown in activity in that market. But, for us, we've taken actions to address this. We've redeployed resources to other parts of our business. We've also had to reduce our cost structure to align to that level of business. But, we're quite comfortable where we're set up now to really continue to deliver for that market and those customers. Great. If we step back and go a little bit more big picture for a second, among the big macro drivers of automation, like supply chain de-risking, labor issues, and so forth, can you talk about where you're seeing the most related activity in the business, and to what extent the pandemic was an accelerator of some of those trends? Yeah, so I'll start there. I mean, the pandemic was... I mean, we did see increased demand in certain areas, and primarily it was in life sciences. So, early in the pandemic, there was a lot of activity around diagnostic devices. Then drug delivery became a major focus, so syringes and other products like that. Because we were able to react very quickly and develop and deliver solutions for our customers on extremely aggressive schedules, we benefited through that time and won new customers. And, you know, where we sit today, that pandemic-related business is behind us. But, those customers now and others are facing those challenges that you mentioned, so the availability of labor, higher employee turnover, and really just getting the right skill sets. So, a lot of customers have taken a more risk-averse approach in building out their capabilities, so they're looking at more smaller locations, typically closer to a customer. They don't wanna be reliant on single-source sites to deliver their products to customers. You know, one of the best examples of this, and it's one we've talked about for a while, but it's still very applicable, is a customer by the name of Insulet, and they do. Their product is the Omnipod. It's a wearable insulin device. And so they came to us. It was pre-pandemic, but they were faced with similar dynamics, where they were sole-sourced from a manufacturing site standpoint in China. And long story short, they were looking to de-risk from that single source and wanted to build capacity in North America, in the Boston region, close to their headquarters, close to their R&D facilities. And so they came to us, and again, pre-pandemic, you know, we helped them design, build their entire North American manufacturing operations and really utilized all of our key technologies, our SuperTrak system, our vision system, our Illuminate Manufacturing Intelligence... and again, these are their numbers from when they spoke at our investor day a number of years ago. But the punchline is their gross margin on their product went from 45% out of China to 65% out of their North American, their Boston area, and all that was done through automation. So it really is a key enabler as companies are looking to de-risk or move manufacturing to what are typically higher-cost regions. Maybe just to tie into the sustainability theme of the conference, to what extent are you seeing customers tap into automation as a way to achieve their ESG agendas? Yeah, so I mean, there's some really clear ties. So the transportation, the shift to electric vehicles, in energy. You know, I talked about our work in nuclear and some of the life extension programs of existing reactors. Now newer SMR builds are on the horizon, along with grid battery storage. I mean, those are all key enablers in decarbonizing energy production. But also in our other markets, it is a bigger factor. Customers are concerned with energy efficiency in their operations, both from a carbon footprint, but also from a cost perspective. They're looking to minimize waste. And so from an equipment perspective, we are developing technology that help our customers meet those goals. A good example is in our food processing business. We launched a product called the Apollo Evaporator, which utilizes a technology called MVR. It stands for mechanical vapor recompression, which, at the end of the day, it significantly reduces the energy consumption in what is an otherwise very intensive, very energy-intensive application. So, you know, this is a particularly meaningful when we've seen the rise in energy prices in Europe over the past 18-24 months, which is a major input cost into this production process. So, you know, products like that, that's a big focus of our innovation. We've also launched a cloud-based energy management system, which measures energy usage at the asset level. And typically, in a brownfield site, so an existing manufacturing site, that is a more challenging area to measure down at a specific asset level. So, what it allows our customers to do is identify opportunities down at that very specific asset level and help them, you know, find ways to plan and address their carbon goals or their energy-related goals. So yeah, it's part of almost every discussion with customers, helping to drive that sustainability agenda within their business. How about with respect to ATS itself? What are some of the company's own sustainability objectives, and how are you driving towards those? Yeah, so we've laid out our objectives, and we do an annual sustainability report. And it's really focused on people, governance, and then our environmental footprint. So, from a people standpoint, workplace safety is critical. Sending our employees home safe at the end of every day is top of everyone's agenda, and we've made good progress in reducing the number of days that employees are away from work-related injuries. And we have targets around lost time severity and reduction in those metrics. Also in people, we've set diversity goals around women in leadership, and we've made good progress over the last several years. We still have more room to go in that regard, but we are making good progress. From an ethics standpoint, we've got a very strong culture around ethics in everything we do. We've got strong governance practices, education systems that all of our employees go through on an annual basis. From a social responsibility standpoint, supporting the communities that we work in, that we live in, that's of importance to us, and again, we have a goal of supporting 100% of the communities in which we work and live, and we've made really good progress there. And then from an environmental standpoint, from a responsible manufacturing, we've committed to being carbon neutral for Scope 1 and Scope 2 emissions by the year 2030. So, we're making progress. We've identified and taken action on a number of initiatives around, you know, things like more efficient lighting, green energy applications, more efficient HVAC systems. So we've reduced the intensity factors of our carbon emissions, so in terms of per revenue or per employee headcount. But again, we still have work to do in that regard, but we're well on our way. I'm gonna come back to something you talked about at the beginning, which is supply chain lead times and, you know, kind of how that's impacted the company's margin improvement journey. And it just, in addition to supply chain optimization, can you talk about what some of the other levers are that you're working against to improve profitability? Yeah, so supply chain is, it's been one of our bigger levers, and it continues to be a big opportunity. So with every acquisition, that introduces a new pool of available spend where we can drive savings. And as well as continuing to build out our strategic suppliers and where we're aligning our spend and where we're seeing the most benefit and value for our operations. Other areas are standardization. So we've won a lot of work in the GLP-1, and again, this is a drug delivery opportunity for us, so it's helping our customers build auto-injectors. And we're utilizing a standard platform, a standard technology platform. It's called Symphoni. It's based on, you know, our SuperTrak and incorporates our SuperTrak linear motion. And that's been a real benefit for us as we've continued to go after new opportunities. And what it enables for customers is the ability to have up to 2-3 times the output and roughly half the footprint of other available solutions, so very meaningful. And again, it's being driven as part of our standardization platform. I think operating leverage is another area we've talked about in the past. That's what I would characterize as a longer-term focus, so we are balancing continued investment into growing other areas of the business that have potential for higher value add over time, so areas like digital services. And so... But there is an operating leverage opportunity with our business. Then the other piece is really optimizing our portfolio. So some of it is continuing to build out our after-sales services business, which is accretive from a margin standpoint. And then also challenging ourselves on areas that don't offer the same value and might not fit. So you know, those are all areas that we're looking at for continued margin expansion. You mentioned M&A in your comments there, and how that helps to provide scale, which is useful, you know, as leverage in your supply chain planning. Can you talk about the role that acquisitions play in the company's growth plans, and, you know, what is ATS's approach to M&A? Yeah, so it is important. It's an important aspect of our strategy and growth plans. You know, from a capital deployment standpoint, when we're looking at deploying capital, we're looking at returns on that, so return on invested capital is our key financial criteria. That starts typically with internal investment, organic growth, margin expansion, but M&A is number 2 on that list for us. We operate, again, diverse end markets. They're generally fragmented. I would say there's lots of white space available for us. M&A is, as I said, important. We look at 4 criteria across every M&A deal. It starts with the market, so back to what I talked about at the beginning, we're looking at markets that have good growth characteristics, lower cyclicality, you know, for example, life sciences and food. Number 2 is what does it bring to ATS? So is it a new technology, new capability? What does it add that we don't have today? We also look at how we're gonna operate. So the management team, do we have to deploy leaders? How quickly can we deploy the ABM, which we haven't talked about, but that's our continuous improvement business model. And then, of course, the financial return. As I said, ROIC is our key criterion. We're looking to achieve double digits or our cost of capital within five years. Most of the deals we've done have been cultivated. As Andrew said, says, and you've heard him say this many times, ABC, or always be cultivating. And that happens primarily in our business unit, so it's not just a corporate function. But yeah, M&A has been a very important part of our growth and, as I said, it will continue to be. Good. We're coming to an end here to some extent. So I've got two last ones for you. One that I'm asked very frequently, and for anyone, you know, who's interested in the business that we've been speaking about, is just what are some of the leading indicators that you would recommend that investors track to sort of track the growth prospects for your business? I know new product development would be, would be one. What else would you highlight? Yeah. So I think, I mean, at the end of the day, that is the most critical. So when companies are looking to invest in new capital equipment, it's typically tied to a new product introduction, or to scaling up an existing product that's seeing significant growth. Excuse me. So, I mean, those are. I mean, we're looking at things within each of our markets. We're looking at our customer CapEx plans and are those growing or shrinking? There's some broader economic indicators around PMIs, which can provide some insight, but we do get focused on niches. So life sciences, for example. It's a big market, and we get very focused on niches within that market or subverticals. Yeah, PMIs and general growth indicators can help, but really we get very deep into understanding customer CapEx plans and what's driving their business around... So again, back to GLP-1 drugs, what is the end market growth, and what are the drivers there that's gonna cause them to have to scale up or to meet that demand? So, that's, you know, that's really how we're looking at it from a day-to-day basis. Makes sense. Maybe just to, to wrap up here and kind of bring things together, if we were to have the same discussion in five years or in 12 months, how do you think the company will have grown over that time, and what do you think we'll be talking more or less about versus today? So I would hesitate to put out a five-year growth number, Cherilyn. But I mean, we've set targets around outpacing growth in the markets, and that is, that's very much something that we're focused on and align our business plans around. We also have margin expansion targets that we've made good progress on, but we still have room to go. I mentioned our ABM and the continuous improvement culture. That really is fundamental to how we operate, and I don't wanna lose sight of it because it's important when, you know, as to how we operate, and it's really part of our culture. So, you know, when we get to those financial targets, part of a continuous improvement culture is we're gonna continue to look for ways to grow, expand margins, and really, at the end of the day, create value for shareholders. It's through the things that we've talked about. It's targeting attractive markets. It could be existing, potentially new markets or new niches within existing markets. It's continuing to drive innovation to better serve customers, whether that's through new technologies, higher value services, new digital capabilities. It's continuing to challenge ourselves to improve, be more efficient through continuous improvement. And then, you know, finally, I would add, it's continuing to deploy capital into areas, both internally and externally, that are gonna generate higher returns for shareholders. So, in a lot of ways, it's more the same, which I think is a good thing. Maybe I'll tack one last quick one on. Just in terms of the end market complexion of the company, do you expect that to be different over a five-year period, or is that somewhat dependent on market opportunities, M&A opportunities, and so forth? So, so I would expect it to be different. But it, the pace and the rate of change and where it ends up, yeah, that'll be very dependent on opportunities. But again, I would go back to what I said around deploying capital into markets we like, less cyclical markets, good growth rates, and so that's areas like life sciences, like food tech. You know, those are typically gonna be areas that we're very focused on. Great. Well, that brings us to the end of our 30 minutes. Again, Ryan, thank you so much for joining us for Sustainability Week. Really appreciate your time. Cherilyn, thank you so much for hosting us. I really appreciate your time as well.