Good day, everyone, and welcome to today's DMC Global Second Quarter Earnings Call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-and-answer session. You may register to ask a question at any time by pressing the star and one on your telephone keypad. You may withdraw yourself from the queue by pressing star and two. Please note, this call may be recorded, and I will be standing by should you need any assistance. It is now my pleasure to turn the conference over to Geoff High. Hello, welcome to DMC's Second Quarter Conference Call. Presenting today are DMC Chairman, David Aldous, Chief Executive Officer, Michael Kuta, and Chief Financial Officer, Eric Walter. I'd like to remind everyone that matters discussed during this call may include forward-looking statements that are based on our estimates, projections, and assumptions as of today's date, and are subject to risks and uncertainties that are disclosed in our filings with the SEC. Our business is subject to certain risks that could cause actual results to differ materially from those anticipated in our forward-looking statements. DMC assumes no obligation to update forward-looking statements that become untrue because of subsequent events. Today's earnings release and a related presentation on the second quarter are available on our investors page at dmcglobal.com. A webcast replay of today's presentation will be available at our website shortly after the conclusion of this call. With that, I'll now turn the call over to David Aldous. David? Thank you, Geoff. Good afternoon, and thank you for joining us for today's call. I'd like to begin by congratulating Michael Kuta on his appointment as President CEO of DMC. I've had the pleasure of working with Mike for nearly a decade while serving on DMC's board, and for the past seven months, we have jointly led DMC as co-CEOs. Mike is a strategic thinker and proven leader, and he has a deep understanding of DMC and its businesses. He has also earned the respect and support of our employees, customers, and board. I'm confident he will thrive in his role as CEO, and I look forward to supporting him as he leads DMC into its next chapter. Our CEO search process involved extensive interviews with several highly qualified candidates, and I wanna thank each of them for their time they spent with us and their interest in DMC. Our board also has been actively interviewing candidates for an open director position, and we announced yesterday that Ouma Sananikone has been appointed to the DMC board. Ouma has spent more than 30 years in C-suites and board-level roles, and brings extensive experience developing and implementing corporate and financial strategy, and we look forward to her contributions. I want to thank my fellow directors for their time and thoughtful consideration of the candidates for both the CEO and director positions. For that, I'll turn the call over to Mike. Thank you for the kind words, David. I've thoroughly enjoyed working together this year. I've appreciated your valuable insight and perspective. I look forward to the continued collaboration with you and the board as we pursue a very promising future for DMC. Turning to our results, DMC delivered record sales and earnings for the second quarter. Our three manufacturing businesses made important progress on the operational and financial initiatives we established at the beginning of the year. Arcadia, our architectural building product segment, reported second quarter sales of $79 million, which were comparable to the first quarter and up 4% versus the year-ago second quarter. Arcadia's commercial business saw steady demand across its markets in the Western and Southwestern United States. A notable project that entered Arcadia's backlog during the quarter is the first phase of a large mixed-use development in Southern California that makes extensive use of glass and architectural framing. The final project will combine more than 460 residential units with extensive retail and commercial space. Arcadia Custom, which serves the nation's high-end residential market, also reported steady customer activity and much-improved operational execution. Arcadia sold through the remainder of its high-cost aluminum inventory, which has been a drag on margins during the past three quarters. The completion of this process helped drive adjusted EBITDA margin to 21%, up from 13% in the first quarter. Arcadia recently completed its transition to a new ERP system. I'm very pleased by how smoothly the conversion went. The system should significantly improve Arcadia's business processes and productivity, and will enhance the buying experience for Arcadia's customers. DynaEnergetics, our energy products business, delivered sales of $85 million, the second-best quarterly performance in Dyna's history. The results were up 3% sequentially and 26% versus last year's second quarter, and reflect strong second quarter demand in both North American and international markets. Unit sales of Dyna's fully integrated DynaStage perforating system were another quarterly record. We expect full year unit sales will surpass the million unit mark later this month. This would be approximately two months earlier than when Dyna reached the million unit mark last year. Gravity 2.0 is the most recent addition to the DynaStage product family and is being well received by customers that are incorporating oriented perforating into their well designs. Gravity is the most compact-oriented perforating system on the market and requires no configuration at the well site. As Eric will discuss in a moment, Dyna's profitability improved markedly in the second quarter, reflecting the impact of several margin enhancement initiatives implemented at the beginning of the year. NobelClad, our composite metals business, delivered second quarter sales of $25 million, up 12% sequentially and 13% year-over-year. A very favorable project mix helped drive NobelClad's adjusted EBITDA margin to 22%. Strong second quarter bookings increased NobelClad's order backlog to $64 million, and improved its rolling 12-month bookings to $108 million. We expect the third quarter will represent another period of double-digit sequential sales growth at NobelClad. Our second quarter SG&A expense was $29 million, down $10 million sequentially. We are closely managing our cost structure and expect quarterly SG&I will remain below $30 million through the balance of the year. We also reduced our debt to adjusted EBITDA leverage ratio to 1.3x, from 2.5x, at the end of last year's second quarter. I'm very encouraged by the progress we've made during the first half of 2023. As we chart our path forward, our focus is on delivering growth, improved cash flow, and stronger returns for our stakeholders. With that, I'll turn the call over to Eric for a closer look at our second quarter financial results and our guidance for the third quarter. Eric? Thanks, Mike. DMC delivered record second quarter sales of $189 million, which was up 2% sequentially, and 14% versus last year's second quarter. Gross margin was 33%, up 450 basis points from the first quarter, and 140 basis points from last year's second quarter. All DMC businesses achieved gross margin expansion during the quarter. Our second quarter SG&A expense of $29 million was 15% of sales, down from 18% of sales in the second quarter of last year. Second quarter adjusted EBITDA attributable to DMC was $32 million, up nearly 60% sequentially, and over 40% year-over-year, inclusive of the Arcadia non-controlling interest. Consolidated adjusted EBITDA was $38 million. As a percentage of sales, total adjusted EBITDA was a very healthy 20%. Arcadia reported second quarter adjusted EBITDA of $16 million, of which $10 million, or 60%, was attributable to DMC. Arcadia's adjusted EBITDA margin was down 50 basis points versus the prior year's second quarter, but expanded 780 basis points sequentially. As Mike noted, Arcadia's margin was compressed during the prior three quarters due to last year's sharp escalation in the cost of aluminum, which is a key raw material in Arcadia's products. Arcadia's second quarter improvement in EBITDA margin reflects its effort to recover pricing after selling through the balance of its high-cost inventory. Dyna reported second quarter adjusted EBITDA of $19 million, or 23% of sales. Adjusted EBITDA margin improved 480 basis points sequentially, driven by a combination of lower litigation costs, greater absorption of manufacturing overhead, new product designs, and a higher margin product mix. Adjusted EBITDA margin expanded 330 basis points versus the prior year's second quarter. NobelClad reported adjusted EBITDA of $5 million, or approximately 22% of sales. A mix of higher margin projects increased adjusted EBITDA margin by 650 basis points sequentially, and 620 basis points year-over-year. Second quarter adjusted net income attributable to DMC was $14 million, or $0.72 per diluted share, up from $6 million, or $0.32 per diluted share in this year's first quarter, and up from $6 million, or $0.29 per diluted share in last year's second quarter. During the quarter, DMC generated free cash flow of $9 million, which compares with $2 million in the second quarter of 2022. We used our cash flow primarily for principal payments on our long-term debt, distributions to our Arcadia joint venture partner, and an investment in marketable securities. In terms of liquidity, we ended the second quarter with cash and marketable securities of $21 million, and had no amounts outstanding under our $50 million revolver. As Mike mentioned, our leverage ratio was 1.3 times at the end of the second quarter, which was well below the covenant threshold of 3 times, and represents the sixth consecutive quarter of deleveraging the balance sheet. Highlighting our third quarter guidance, which is detailed in our news release, we expect consolidated sales in a range of $178 million-$188 million versus the $189 million reported last quarter. We anticipate Arcadia will experience some downward pricing pressure during the third quarter on relatively stable volume. Dyna expects activity levels in its core North American market to soften a bit in the second half of the year based on lower well completion activity. However, Dyna does expect to maintain its market share in advance of the next upcycle. NobelClad expects a sequential sales increase of approximately 20% in the third quarter, as it delivers key projects from its order backlog. Consolidated gross margin is expected in a range of 29%-30%, compared with the 33% in the second quarter. Consolidated SG&A expense is expected to range from $28 million-$30 million. Third quarter adjusted EBITDA, attributable to DMC, is expected in a range of $24 million-$27 million. Finally, we expect second quarter capital expenditures will be in a range of $5 million-$7 million, while full year CapEx should be in a range of $18 million-$20 million. With that, we're ready to take any questions. Operator? At this time, if you would like to ask a question, please press the star and one on your telephone keypad. You may remove yourself from the queue by pressing star and two. Once again, to ask a question, please press the star and one. We'll take our first question from Gerry Sweeney with Roth Capital. Your line is open. Good afternoon, Mike, Eric, David, and Geoff. Thanks for taking my call. Hi, Gerry. Gerry. Mike, first of all, congratulations. It was been a nice press release to see on a Monday morning. Again, congratulations. Well deserved. Thank you, Gerry. Just jumping right into the questions. You know, with Arcadia, maybe would you be able to dig in a little deeper, right? So we have, we know, higher aluminum costs. There's a lot of activity there as well. I'm just curious as to what is sort of maybe equilibrium on margins as you work through some of the higher aluminum costs they get through the system. I'm not sure if they were all the way through the system in the quarter or partially, and where would sort of margins ideally sort of fall out longer term? Yeah. We, Gerry, we recovered, margin lost in, in Q2, and, and probably, the recovery was quicker than expected from a guidance standpoint. I think from a longer term, we would think low 30s. Probably, in that 31, 32 type zip code. Gotcha. Then also, obviously, you know, we got a couple things going on here, right? First of all, great quarter. We're seeing de-leveraging. Dyna's doing great. Then you also have this Arcadia put/call next year. You also have some really nice growth opportunities with Arcadia in markets that you're just starting to look at or starting to penetrate, right? Houston, Dallas. How do we look at a balance of de-leveraging versus growth opportunity, growth opportunities over the next 12 to 18 months? Yeah. First of all, you know, we, we feel like we've got a very clear and strong path, on, you know, the put/call, and, you know, but definitely we know that that's out there, so we're gonna balance the growth side with, you know, the investment on the Arcadia side. We do feel very bullish about generating cash flow the remainder of this year and into 2024. We feel pretty optimistic that we're gonna be able to balance that pretty well and be able to invest in Arcadia, continuing with investments this year to put paint capacity in place, and next year, to put a second leg of capacity in and continue on in 2024 with investing in that business and also making some investments in Dyna NobelClad. Yeah, just maybe this is Eric. One thing to add to that is, when we go through the capital allocation process, the first question we ask is: What are the businesses need to support their growth? We start with that and make sure that we can fund that. Then with excess cash, we use it for the delivering process. We feel pretty comfortable that everything that Dyna's got ahead of themselves in terms of paint capacity and other longer term objectives, that we're gonna be able to fund that, but also use additional cash that we're throwing off from the other businesses to get through the delivering process. I think lastly, Gerry. Yep. Yeah. Lastly, Gerry, I mean, some of the things we're looking at in terms of CapEx are big impact, but lower CapEx, so. Got it. Then one quick question on Dyna, and I'll jump back into you, Eric. You know, obviously, great quarter. It sounds as though that maybe at least three twos, well, you said second half would slow down, but my sense was things maybe it slowed going into the end of 2 Q into 3 Q, but there's also this feeling that at some point, activity is supposed to pick up. What's your feeling maybe this quarter, fourth quarter, and then is that a accurate sort of assessment of what we're seeing with the market maybe into next year? Yeah, we're projecting a softer Q3 that's reflected in our guidance. We think that Q4 could be a bit soft as well, maybe, maybe a bit better than Q3. As we look forward into 2024, I think it's gonna be a really nice setup for 2024 and a nice recovery off of 2H 2023. You know, we're feeling pretty optimistic looking through the third quarter here into the fourth quarter in 2024, we're set up nicely. Got it. Okay, I appreciate it. Congrats on several fronts there. Thanks. Thank you. Our next question comes from Ken Newman with KeyBanc Capital Markets. Your line is open. Hey, guys. Hi, Ken. Hi, Mike, congrats on the appointment. Well earned. Thank you. Maybe just getting started here, I want to circle back to Arcadia. Thanks for the color on the longer term gross margin, you know, profile there. Understand there's been a lot of moving pieces, I guess on the revenue line for this quarter, can you just clarify how much of that revenue growth was from price versus volumes? You know, we think from Q1 to Q2 sequentially, it's probably flattish on both fronts and year-over-year, Eric. Yeah, year-over-year, it's gonna be primarily pricing, because as we've talked about in other calls, the business is fairly constrained from a volume standpoint. Any type of fluctuation until we can add in this paint capacity is gonna primarily be pricing. Yep. As I think about, you know, I know you're, you're kind of putting in the new paint capacity today, and, and I think you talked a little bit about, you know, further capacity expansions in 2024. If volumes are flattish through the back half and, you know, pricing is kind of moderating on some of these, raw material costs, just how do you think about the impact to, you know, gross margins for that segment as we think about 3Q and 4Q? Yeah. I think the gross margins will moderate from Q2 levels because there is gonna be some pricing pressure that we're gonna see in some of the select markets. We do think that the volumes are gonna be relatively stable based on what our backlog is right now and what we can see out over the next, call it 60-90 days. The, the paint capacity is gonna be strategic for us. We think that that's gonna be something that, beginning at the end of this year and going into 2024, is gonna be adding, you know, upwards to 10% top line capacity for Arcadia, and that's gonna be really transformational for the business. It'll be the first time in a long time that we've actually been able to grow volumes. As that increases, going into next year, it could also increase the amount of absorption of manufacturing overhead, which could help gross margins in 2024. We think for the balance of this year, it's gonna be relatively flat, volumes. Understood. Then just kind of moving, this is kind of a, a general question across all of the businesses, but, you know, we have heard about, you know, from other industrials this earning season, that, you know, some, some impacts about supply chains normalizing and maybe some customer inventories, you know, customers destocking inventories as those kind of normalize. Curious if you're seeing that impact at all across any of the three businesses, or if that's kind of being, something that of, of a near-term wash point for you at this point? You know, Ken, we don't see that as a significant issue. When you think about our two largest businesses, Arcadia and Dyna, they're pretty short cycle, quick turn. Our customers don't have a lot of inventory, right? A lot of that business is sort of, I'd say, hand to mouth, right? I just don't see an impact, a customer destocking impact in our, in our results, our guidance or in our future. Roger that. Appreciate it. Thanks. Thank you, Ken. As a reminder, to ask a question that is star 1, and you may remove yourself by pressing star two. We'll take our next question from Sean Mitchell with Daniel Energy Partners. Your line is open. Hey, guys. Thanks for taking the question. Obviously, my question will revolve around Dyna more than anything. Could you talk a little bit more about the margin enhancements you're working on within Dyna? I know you had some litigation expense in Q1 that you didn't have in Q2, but just margin enhancement in Dyna. Then the second one would be, given DS Gravity 2.0, is the customer mix changing at all? Can you talk about kind of how the conversations are going around the DS Gravity 2.0? Yeah, a couple of questions there. I think the first one, we've got operational initiatives in our, in our plants, op excellence, initiatives that, we're working on margin, that gets into not just our plants, but in, in our products as well, and how we're streamlining those. You know, that's, that's contributing to the, to the margin. You know, from a, a Gravity 2.0 standpoint, self-orienting systems, you know, that's, one that, you know, we're starting to get some traction around and customer interest. You know, that's a product that, you know, could, from a mix standpoint, also, you know, help our margins as well, something that could be 10-15% and upwards of 20% of our, our business on a, on a go-forward basis. I mean, you know, we are seeing, you know, as we move from Q2 to Q3, as mentioned, we're seeing a bit of a softer market. You know, there will be some absorption impact in Q3 and, and customer mix, impacting our results, but we expect a pretty resilient, if not strong, Q3 as we move forward. Got it. Thank you, guys. Thank you, Sean. As a reminder, that is star and one to ask a question, and you may remove yourself from the queue by pressing star and two. We'll take our next question from Alec Scheibelhoffer with Stifel. Your line is open. Hi, good afternoon, everyone, and Michael, congrats again on the appointment. Again, great to hear, to see that on a Monday. Thank you, Alec. Hey, Alex. Hi, everyone. Just kind of honing in again on DynaEnergetics. Clearly, how the quarter performed, it was very strong relative to what completion activity's been doing. Can you just talk about the competitive landscape and what you're seeing on the market share side? I think you said during your prepared remarks, you're going to be approaching 1 million unit sales sometime in the next month or month or so. I guess, just how the volume outlook looks for the remainder of the year and maybe even in fourth year, if you have any color there. Yeah, from a competitive intensity standpoint, you know, we think that, you know, that there's high competitive intensity here. We think with our value prop in DynaEnergetics, you know, the market leader, you know, we're, we're trending up on share and, you know, that's in part due to our customers and, and our customer's customers. We've got, great, great customers that we partner with, that are leading the charge on this. I think that's a big part of the Q2 tick up, and I think the resilience you're seeing in Q3. Great. Thank you, and I'll turn it back. Thank you. It appears we have no further questions at this time. I'll now turn the program back to Michael Kuta for closing remarks. Thank you again for joining us today. The progress we've made this year to strengthen and grow DMC reflects the exceptional effort of our employees, and I want to sincerely thank them for their commitment to the company. I also want to thank our customers for their loyalty, our board of directors for their continued support. We look forward to speaking with you again soon. Take care. This does conclude today's program. Thank you for your participation. You may disconnect at any time.