Hello all, and a warm welcome to the Morgan Advanced Materials 2022 half-year financial results call. My name is Lydia, and I'll be your operator today. If you'd like to ask a question after the prepared remarks, please press star followed by the number 1 on your telephone keypad. It's my pleasure to now hand you over to Pete Raby. Please go ahead when you're ready. Thank you, Lydia. Good morning, everyone. I'm Pete Raby, the Chief Executive of Morgan Advanced Materials. I'm joined on the call by Richard Armitage, our CFO. I'm going to say a few words of introduction. Richard will then take you through our interim results for 2022, and I will then talk through the business unit performance and growth drivers and our progress against our ESG priorities. Starting with the highlights. The safety of our people is our top priority, and I'm grateful to all of our people for how they've looked out for each other during the first half of the year, keeping each other safe while increasing output rapidly to meet customer demand. We've delivered 11.2% organic revenue growth with 15% growth in our faster-growing markets and 11% growth in the core. I'm pleased with the further progress in our faster-growing segments, reflecting the focus and investment that we've been making. Operating margins have expanded to 13.7%. We've seen inflation increasing during the first half, as expected, and we've passed that on to our customers with higher pricing. The impact of pricing and continuous improvement more than offset the cost inflation that we've experienced year to date. The strong growth in revenues and profitability has delivered a 22.2% return on invested capital. Earnings per share of 15.9 pence is up 25% on the prior year. We saw a modest free cash outflow during the half, and we ended the half with net debt to EBITDA of 0.5x. We've also made further progress in reducing our CO2 emissions with an 11% reduction compared to the prior year. I'm very pleased with the further progress that we've demonstrated during the first half. We've delivered strong revenue growth and expanded margins as planned in a challenging supply chain and labor environment. We've done much to strengthen the group over the last six years, and that's underpinning our performance, and it gives us confidence as we face into the uncertain environment of the next couple of years. I'll now hand over to Richard to take us through the financial results. Thank you, Pete, and good morning, everyone. Let me start with an overview of the financial results to the 30th of June. Revenue at GBP 530.2 million was 11.2% higher than prior year on an organic constant currency basis. Group adjusted operating profit was GBP 72.5 million with operating margin 90 basis points higher at 13.7%. Inflation to date has been recovered in full, with further margin expansion achieved through efficiency savings and higher volumes. Cash generated from operations was GBP 45.2 million and free cash flow a small outflow of GBP 1 million, both lower than last year due to an increase in working capital that I will come back to shortly. Adjusted EPS was 25.5% higher at 15.9 pence per share, reflecting the higher operating profit and slightly lower tax rate. The interim dividend proposal is 5.3 pence per share. As a reminder, the board is looking to grow the ordinary dividend as the group's earnings improve, targeting a dividend cover of around 3 times adjusted EPS on average over the medium term. As usual, we have included in the appendix the financial information in statutory format, and there were no significant adjusting items in the period. Moving on to the profits bridge, we can see the year-on-year movement in our adjusted operating profit, with the key drivers. We can see firstly the benefit from higher volumes in the year. This growth has been broad-based, with all business units seeing growth of between 8% and 21%. We are benefiting from the final savings from our restructuring program, which will amount to an additional GBP 3 million for the 2022 full year, bringing the total to GBP 23 million as previously communicated. Our aim continues to be to offset inflation with pricing, which together with our ongoing continuous improvement projects, has more than offset cost inflation in the period. There has also been some investment in additional overheads, particularly in R&D and sales, in support of our ongoing growth programs. Finally, we have benefited from a small tailwind from the weakening in sterling, which has improved operating profit by just under GBP 3 million. Moving on to cash flow. We have seen quite a substantial increase in working capital, driven principally by three factors. Firstly, revenue growth has added about GBP 10 million of working capital. We have seen an additional increase in inventory of around a further GBP 10 million as a consequence of needing to increase safety stocks at a number of sites in response to supply chain concerns. Finally, the effect of a weakening in sterling has accounted for much of the rest of the increase. I would note that the quality of our debtor book has remained stable, with no particularly material bad debts or changes in customer payment terms arising. Capital expenditure was in line with expectations at GBP 22 and a half million, an increase of GBP 13.9 million compared with the prior year. Free cash flow before dividends was therefore a small outflow of GBP 1 million for the half. It is worth noting that net cash flows from other investing and financing activities in the prior year benefited from the proceeds of the sale of the Gemtek business in 2021. Net debt was GBP 76.3 million, excluding lease liabilities. Net debt to EBITDA, excluding leases, the measure which most closely aligns to our covenants, was 0.5 times at the period end. We have included our usual summary of our funding profile in the appendix. Finally, I've included an update on the financial framework for 2022. As you can see, we expect our adjusted effective tax rate to continue to be in the range from 26%-28% this year. Based on current exchange rates, we expect our finance charge to be around GBP 10 million, comprising a cash interest charge of around GBP 6.5 million on our net debt, a non-cash pensions financing charge of around GBP 1 million, and around GBP 2 million of interest on our lease liabilities. We would note that the IAS 19 deficit in relation to the Group's pension schemes has fallen further to GBP 49.2 million in December. We expect our cash contributions to the defined benefit schemes across the Group to be unchanged at around GBP 20 million for the full year, the majority of which is to our UK schemes as previously outlined. Overall, the Group's balance sheet remains strong, giving us a range of options for the deployment of capital in the medium term. As usual, we have set out in the appendix sensitivities for revenue and adjusted operating profits to changes in the value of sterling against the US dollar and the euro. For 2022, we expect capital expenditures to be around GBP 55 million as we invest to support continued growth in the business, in efficiency projects, and in our infrastructure and ESG projects. That covers the key financial items. With that, I'll hand you back to Pete Raby. Thank you, Richard. I'll now take you through the performance of our business units, the growth performance in our faster-growing markets, an update on progress against our ESG goals, together with our current positioning and the business outlook. Slide 10 shows the organic performance in our major market segments. Revenues in our industrial segment grew 14%, with broad-based growth across the major industrial economies. Transportation was up 5%, with growth in aerospace offsetting a decline in automotive. Chemical and petrochemical revenues grew 15%, with strong sales of seals and bearing components, together with modest growth in thermal insulation projects. Semiconductors were the standout with 50% growth year on year, reflecting the strong demand and share growth following the investments that we've been making in this sector. Revenues in the healthcare segment grew 4%, with strong demand for medical imaging and implantable products, offsetting a decline in low-temperature insulation sales for vaccine transport. Energy was down 6%, driven by declines in the solar market, with carbon felt sales to Asia down on the prior year, impacted by COVID in China and freight costs. Security and defense revenues declined by 4%, driven by a decline in ceramic armor sales, as we expected, as that business reduces steadily from the 2020 peak. Moving to our global business units, I'll start with Thermal Ceramics. Thermal Ceramics revenues grew organically by 11.1%, with good growth in all the major industrial markets and growth in energy markets. Operating margins declined to 11.3%, with our pricing and continuous improvement actions offsetting but not exceeding inflation, hence compressing the margin percentage. Turning to Molten Metal Systems, revenues increased organically by 20.6%, with strong demand and share wins in the aluminum segment. Margins expanded to 14.9%, reflecting the drop through on the increased revenues and efficiency actions. In Electrical Carbon, revenues increased 8.4% organically, with a very strong growth in the semiconductor segment to go with growth in wind energy projects. Margins expanded further to 20.7%, reflecting the drop through on the increased volumes together with pricing and continuous improvement actions that more than offset cost inflation. This was another very impressive performance by the team. Moving to Seals and Bearings, revenues grew organically by 7.8% with a reduction in armor as expected, offset by growth in aerospace and petrochemical. Armor was down slightly at GBP 12 million in the first half, and we expect armor sales for the full year to be around GBP 20 million-GBP 25 million. We have seen some additional orders here for shipment this year, given the situation in Ukraine. Margins declined to 15.2%, driven by adverse armor sales mix. Turning to Technical Ceramics, revenues increased organically by 13.3%, with growth in industrial, semiconductor, healthcare, and aerospace segments. Margins expanded to 13.6%, reflecting the drop through on the increased revenues and the benefits from our restructuring program. Over the last four years, we've increased business and product development activity in four faster-growing market segments: clean energy, clean transportation, semiconductors, and healthcare. These markets have good underlying long-term growth drivers, and we expect them to grow more quickly than our core business over the cycle. In the first half, these markets accounted for 21% of the Group's revenues. I'm pleased with the further rapid growth in these segments in the first half, with organic growth of 15% ahead of our core markets, which grew 11%, reflecting the benefits of our investment. The Semiconductor segment was again the standout. Organic growth of 50% was a broad-based success, with share gains at existing customers and wins with new customers, increasing our exposure to the semiconductor manufacturing process. We expect these faster-growing segments to have high single digits to double-digit growth rates through the cycle. These high growth rates are a result of the enduring global trends that we see today, including digitization, climate change, and a growing and aging population. We're continuing to invest in new products and solutions to serve each of these markets. By increasing our exposure, we increase the underlying growth rate of the group, incrementally expand our margins as newer products contribute to the mix, and improve the alignment of our portfolio with our purpose, reinforcing our ESG credentials. I'll now turn to our goals and progress on the environmental, social, and governance or ESG, shown here on slide seventeen. Our purpose is to use advanced materials to make the world more sustainable and to improve the quality of life. This purpose guides our decision-making and strategy, and we deliver on it through the way that we operate and manufacture our products, and through the products themselves and the benefits that they bring to our customers. We're constantly investing in our manufacturing processes to reduce the environmental impact of our business. In parallel, we're investing in new materials and process technologies that improve the performance of our products and deliver bigger environmental and safety benefits to our customers. We have five ESG priorities that we'll be working on, and we've set targets for those for 2030. We'll reduce our Scope 1 and 2 CO2 emissions by 50% by 2030 from our 2015 baseline as part of our aspiration to be net zero by 2050. We're committing to reduce our water consumption overall and in high and extremely high water stress areas by 30% by 2030. We're also determined to provide a safe, fair, and inclusive workplace for our people. We've committed to a lost time accident rate target of 0.1 by 2030 against our goal of zero harm. We want our workforce to reflect the communities in which we operate, and we set a target of 40% of our leadership population being female by 2030. Finally, we want a welcoming and inclusive environment for our employees where they can grow and thrive. We set a target of achieving a top quartile engagement score by 2030. Slide 18 shows our progress in reducing CO2 emissions since 2015. Our CO2 emissions in the first half were down 11% on the prior half year. A good performance with revenues growing 11%. We have a broad-based improvement program underway covering energy procurement, process improvements, and behavioral changes in our plants. In 2022, the biggest contribution has come from procurement, where we have transitioned to carbon-free energy for a number of our sites. 49% of our electricity now comes from green or carbon-free sources. Turning to water, safety, and diversity on slide 19. Our water usage is up 10% over 2021 first half levels, driven by the growth in the business and some shifts in product mix towards more water-intensive products. Similarly, our water usage in high and extremely high stress areas increased 6.3% in the year, also driven by the growth in volumes, partially offset by improvements in water intensity. We have projects underway to drive reductions in our water use across the business, and those will start to deliver on completion in the second half. Looking at safety, we've seen an increase in our lost time accident rate. That's the number of lost time accidents per 100,000 hours worked. Our rate increased to 0.29, up from 0.22 at the end of 2021. We're well underway with the refresh of our think SAFE behavioral safety program during the year, with training now completed by around 80% of our employees. We're reinforcing our training, increasing safety tours, safety discussions, near-miss reporting, and root cause analysis of all of our lost time incidents and any significant near misses. This is a significant focus for us as we look to improve our performance. From a diversity and inclusion perspective, we've set a goal of 40% of our leadership population being female by 2030. Our half year position is 31%, slightly improved on the 29% position at the beginning of the year. We've got a broad program of work underway to drive improvements here, making changes to everything from policies to training to recruitment processes. In summary, we delivered 11.2% organic revenue growth with a broad recovery in our markets and through share gains. Together, clean energy, clean transportation, semiconductors, and healthcare grew 15% in the year. Operating profit margins increased to 13.7%. Our pricing actions, together with continuous improvement, more than offset inflation during the first half of the year, and we expect to do the same in the second half. ROIC increased to 22.2% and earnings per share were 15.9 pence, up 25% on the prior year. Free cash flow was modestly negative and net debt to EBITDA is 0.5 times. We've reduced our Scope 1 and 2 CO2 emissions by 11% despite the underlying growth in the business. We're pleased with the performance and the momentum in the first half of the year. As we previously indicated, we are expecting a moderation of growth in the second half of the year, reflecting challenges in the wider economy. Nonetheless, we expect our profitability for the full year to be around the top end of analysts' forecasts. We've made a wide range of significant improvements to the business over the last six years. The business is growing more strongly, margins are at much higher levels, and the balance sheet is strong. We're well placed to navigate the potential economic challenges in the near term and deliver a resilient performance. Thank you. That ends our formal presentation. With that, we'll now take questions. I'll hand you back to Lydia, who will explain the process for Q&A. Thank you. If you would like to ask a question, please press star followed by the number one on your telephone keypad now. To withdraw your question, hit star followed by two, and when preparing to speak, please ensure your device is unmuted locally. Our first question today comes from Scott Cagehin from Investec. Your line is open. Thank you. Good morning. Thanks, Pete and Richard. Just two quick questions, please. Maybe the first question might be a bit longer, but could you just go into a little bit more detail on the growth in semiconductor? You talk about, you know, market share gains and products, innovation, et cetera. Could you just give us a little bit more color on that, where it's coming from? Is it different regions? What, you know, products specifically? And then the second question is, you know, given where the balance sheet is, sorry for the obvious question, but is there any updates on acquisitions? Are you doing more work on that? Are you seeing any changes out there that gives you more encouragement that you may be able to do some in the future? Thank you. Thank you. Good morning. Thanks, Pete and Richard. Just two quick questions, please. Maybe the first question might be a bit longer, but could you just go into a little bit more detail on the growth in semiconductor? You talk about, you know, market share gains and products, innovation, et cetera. Could you just give us a little bit more color on that, where it's coming from? Is it different regions? What, you know, products specifically? And then the second question is, you know, given where the balance sheet is, sorry for the obvious question, but is there any updates on acquisitions? Are you doing more work on that? Are you seeing any changes out there that gives you more encouragement that you may be able to do some in the future? Thank you. Sure. Morning, Scott. Yeah, on the growth in semicon, really pleased with the performance. Much of the sales for our semicon products go through Europe and the U.S., which is where the OEMs tend to be. The end markets will be fabs, which are obviously global, but probably with a heavier weighting in Asia. A lot of even our aftermarket products go through the OEMs to the end market customer. The growth really is across the whole sort of semiconductor manufacturing process. You know, crystal growth, you know, we've seen you know, strong appetite there for some of our carbon products. You know, deposition, etch, ion implantation, you know, a lot of activity again. I think the semiconductor market in general is strong and we've continued to win share with some of the new products that we've introduced over the last 12-18 months. In terms of sort of balance sheet and M&A, you're absolutely right. The balance sheet is robust, and we are actively seeking M&A prospects. We see Mm-hmm. I would say we haven't seen at this point much moderation in sort of price expectations from sellers. You know, we've looked at a number of things during the first half of the year and unfortunately stepped away either on the basis of strategic fit or a sort of price expectation that wasn't realistic. That is something we're, you know, absolutely upping the intensity on. We're very keen to do incremental M&A that can accelerate our strategy. Richard's actually gonna take the lead on driving that on behalf of myself and the board to push that through a little bit faster. Great. Thank you very much. Our next question today comes from Maggie Schooley of Stifel. Your line is open. Morning, Pete. Morning, Richard. Thank you for taking my questions. I have a few, if I may. It's evident that price increases have been successfully implemented in the first half numbers and will have been well understood by clients given the current climate. As you look forward, is there any sign that price elasticity may be more challenged from particularly perhaps from the core as opposed to the faster-growing markets? So just an understanding of what you're seeing there. Then secondly, in energy, you call out that solar markets is more challenging. I assume this is because of some of the tariff issues in the U.S. There was recently an executive order to give a 24-month bridge or reprieve for some of the solar imports in the U.S. Are you starting to see that market potentially pick up as you exited the period? Lastly, sorry for the third one, just to follow up on Scott's question. Just very basically, on the electronics, can you split that or are you able to split that, end market spend between what you would consider CapEx driven versus consumer-led electronics exposure, if possible? Thank you. Morning, Maggie. Let me comment on pricing. I'll let Richard pick up on that a little bit as well, just perhaps to give his perspective. I don't think we're seeing any signs at this point of difficulty passing on price increases to customers. Clearly, you know, we are seeing high levels of inflation across the board, and I think that's well understood by customers. I assume as we head into 2023, you know, those high levels of inflation will drive some level of demand destruction in the wider economy and probably, you know, in my central cases, that leads to some level of recession into the Europe and the U.S. There may be a you know, a pricing impact in due course as sort of capacity utilization declines a bit. Certainly at present, we're not seeing anything. I don't know, Richard, do you wanna add anything on the sort of, you know, just the pricing we've seen in the first half and how you're thinking about that? Morning, Maggie. I think my assessment would be the same as Pete's. I think for us, I'm very focused on, you know, what we can do about that. The only thing we can do really is just ensure that we are, you know, as involved with this as possible. Having delivered a good performance in the first half, you know, we're preparing to be able to respond quickly to whatever might come along, and aim to continue that performance and then we'll see what happens, I guess. Thanks, Richard. To your question on energy and solar, Maggie, a couple of sort of specific things for us. There were some one-offs in our sort of solar numbers last year. We've done some project activity with some of our customers which we didn't expect to repeat and they haven't. Mm. It just impacts the comp a little bit. You're right, some of it is Asia related. We do export. It's one of the few things we do export from the U.S. into Asia, some carbon felt products that are used in solar panel manufacturing or solar cell manufacturing, I should say. They're a combination of sort of COVID impacts in China in the second quarter together with just freight rates around that have depressed that part of the business. It does tend to vary a little bit according to sort of demand levels and sort of landed costs in the region. Those were the sort of headwinds. You know, the rest of that sort of renewable energy side in terms of wind, et cetera, has been robust. On electronics and semicon in terms of the mix. I can't give you a direct split, in part because we don't know it. In many cases we're supplying products to OEMs, and it's not, you know, clear to us whether they sell it as an aftermarket sale or as a new equipment sale. What I would say in general is the products we're supplying are consumable items. You know, it is likely that the majority of it, just given semiconductor manufacturing volumes, is consumables rather than sort of CapEx related. You know, certainly for us, we pay close attention to sort of semiconductor build rates, as well as the CapEx cycle. Okay. Very clear. Thank you all for taking my questions. Good set of results. Thanks. Thanks, mate. As a reminder, if you would like to ask a question today, it's star followed by the number one on your telephone keypad. We have a question from Harry Phillips of Peel Hunt. Please go ahead with your question. Good morning, it's Harry Philips from Peel Hunt. Couple of questions, please. The first one is just in Technical Ceramics, and I think possibly Scott's question around semiconductors partly answered it. The margins have taken a big leap forward, probably the highest to the highest level in quite a long period of time. Is this sort of level now sustainable, and is it driven by a better mix helped by the likes of semiconductors? The second is just the growth rate in Electrical Carbon, which is, you know, extraordinary when you consider that a few years ago Electrical Carbon was seen as a mature aftermarket driven business, and it's now got 20% margins and growing. Is that growth rate, not so much the margin, but the growth rate sort of feasible and sustainable? Lastly, just on the ceramic armor, just a GBP 1 million drop, I think was the sales impact in the first half, but we're still looking for 10. Does logic obviously say GBP 9 million, 10 million in the second half to fall away in that period, please? Sure. Morning, Harry Philips. Probably need to give the caveat upfront with my advice. On the Technical Ceramics piece. Really pleased with the margin progress there. I mean, I think we've commented over a number of years that, you know, the margins in that business would pick up as we rebuilt the sort of pipeline at the front end and saw sort of newer products coming through, which had a higher margin profile. It also benefits from much of the restructuring program benefits this year. Those are coming through fully. The last of the plants that we closed were in Technical Ceramics in the second half of last year. That's supporting the margins there. In terms of sort of sustainability, yes, I think, you know, our expectation is that that business sort of heads towards, you know, a mid-single digit margin position sort of through the cycle. Obviously we'll have to see what the market brings in the coming months, but that's certainly what we're aiming for. In terms of Electrical Carbon, yeah, very pleased as you pointed out, with both the growth and the absolute margin position. You know, a lot of work has gone into sort of new product areas in things like, you know, wind energy and semiconductors, as well as looking to sort of redevelop some parts of the core business where, you know, the original sort of DC business, DC drive business is going away and we've been looking to find new applications in things like aerospace, to support that. I'm encouraged there. I think, you know, the forward growth rates, you know, ultimately how they depend on the market, but I'm certainly optimistic about our ability to continue to grow in those faster growing segments, in that part of the business. In terms of armor, yeah, we're assuming that's gonna slow some in the sort of second half of the year to the sort of GBP 20-25 million. It's a little hard to judge. As you know, we've, I think, probably been too pessimistic over the last several years around the sort of armor position, but we don't get particularly good visibility from our customers. The situation in Ukraine is obviously having an impact on that, and there's some uncertainty around, you know, what requirements might be and when orders may get placed. Our working assumption is GBP 20-25 million for the full year. Great stuff. Thanks very much indeed. Okay, super. Finally, we have a question from Richard Page of Numis Securities. Please go ahead. Thank you. Morning all. A couple of questions from me, please. The Q2 growth rate, given the organic growth stayed at 11% from Q1, suggests, you know, momentum's still very strong in the business. Have you seen any signs of slowdown at all, just given the guidance you're providing? And then secondly, obviously big working capital investment like many others in the space in the first half again. Could you just give us an update on what you're seeing in terms of supply chain issues, both from your perspective and in and customers' perspective? And then ultimately, sort of, I guess, million-dollar question, what sort of contingency are you now gonna be building into your own supply chains in future, even as those supply chain issues ease? Thank you. Sure. Morning, Richard. Well, I'll pick up with growth and let Richard comment on sort of working capital and the supply chain. So in terms of end market position, I think it varies a little bit, Richard, but I would say overall, we are seeing some, I'd say, early signs of slowing. So things like domestic appliances in Europe, you know, been a little softer, perhaps, you know, of late. I think that's been reflected in some of the other results that we've seen around the market as well. You know, we do sort of seasonally see a slowing of order intake in Europe as we head into the s ummer, so it's a little difficult to disentangle some of that. I think there is some underlying softness starting to come through in Europe. You know, the US remains pretty resilient. Then turning to Asia, you know, China has been quite weak, you know, as expected, given the kind of COVID situation they had there during the second quarter. At this point, there's not yet signs of that improving, and I think there are some sort of wider structural challenges in that economy with the whole, sort of infrastructure, housing, challenges, plus the ongoing sort of challenges around COVID. I think that also looks a little bit, sort of more challenged as we go into the second half, and I think that spilled through into some of the other regional economies. Sort of South Korea, for example, again, a little slower for us, in the sort of back end of the first half. Richard, I'll pass to you on the second question. Morning, Richard. I think in terms of supply chain, it's not really possible to call out, you know, one or two big, very material things that have happened. I think this is more to do with a number of sites having concerns about perhaps raw material supplies or freight or, you know, backlog reports, all those sort of things that are happening, and therefore making sure that they're maintaining safety stocks where necessary, just to ensure that we can sustain our customer service. I think that we've probably done what we need to do in that respect, in as far as it affects working capital. In other words, you know, I wouldn't necessarily be expecting another GBP 10 million of inventory being needed. But we'll see how we go. At some point we would expect to reverse some of that, but I don't think we're gonna call out when the timing of that will be, 'cause for the time being, at least, you know, there are still concerns about some aspects of global supply chain. Very clear. Thank you. All right. Thanks, Richard. Thank you. As a final reminder, it's star followed by the number one if you'd like to ask a question. We have no further questions on the line, so I will hand back for any closing remarks. Super. Thanks, Lydia. Well, just thank you very much indeed, everyone. With that, we'll close the call. This concludes today's call. Thank you very much for joining. You may now disconnect your lines.