All right. Well, hey, everyone. Thanks for joining today. For those in person and online, welcome to the UBS Technology Conference. I'm Josh Spector, North America Chemicals and Packaging Analyst, and happy to have on stage with me Ben Gliklich, CEO of Element Solutions. Ben has been CEO since ESI itself was formed in 2019, and prior to that, role was COO and other roles within the predecessor firm, that was Platform Specialty. For those that aren't familiar, ESI is about two-thirds electronics materials, about a third industrial and other specialty chemicals. Within the electronics side, serve a range of end markets from semis, advanced packaging, circuitry, and assembly materials businesses overall. We'll get more into that in a minute. Before we get started, just as a research analyst, need to disclose a relationship of myself and UBS with any firm I express a view on this discussion today. Those are available at UBS.com/disclosures, or you could reach out to me. As a reminder, we won't be talking about any material non-public information. With that, one reminder for those in the room, there is a QR code on the table. If you wanna ask a question, scan that. That will go to this iPad next to me. We can try to work that in, as we go through this call today. With that, I wanna welcome Ben. And I figure an easy place to start here is a quick overview, key takeaways from 3Q, anything you wanna highlight, more near-term trends, updates that impact any views on the second half. Sure. Great. Thanks, everybody. Thanks, Josh, for having me. Thanks for joining. It's great to be here. You know, we had a really strong third quarter at Element Solutions, nearly record third quarter, driven by an acceleration only in certain pockets of the electronics business, right? So we're not seeing a uniform improvement in our electronics business, but what we're doing in certain front-end applications for high-performance computing for electric vehicles is really gaining a lot of traction. And so our semiconductor business grew north of 20%. Our circuitry business was growing in the high single digits. And overall, Adjusted EBITDA grew very substantially. The trends that we saw in the third quarter should persist into the fourth quarter, right? A robust environment for certain areas within electronics. We're not seeing that broadening yet, per se, and a softer industrial environment. The industrial market weakened in the third quarter, and that's persisting into the fourth quarter. That's being offset in our industrial business by strength in our offshore business. So even though we're seeing soft revenues, we're actually growing profits, and that should be the sort of way that things progress through the back half. Okay. One message from that call I wanted to follow up on is that you made a specific comment about Element Solutions growth, maybe disconnecting a bit from units. So historically, you look at how you guys have messaged, how analysts have looked at the company, myself included, looked at smartphones, autos, outperformance to that based on content gains, but a lot of things going on. So, zooming in on the disconnecting from units, how should investors really think about the growth of your markets? What should we be paying attention to, and what drives that disconnection in your view? Yeah. So the business is unit-driven. It's just what unit should we be looking at? And what's happened over 2024 is this divergence where some of the legacy consumer electronics, high-end consumer electronics like smartphones that propelled the business have been soft, yet the business now is achieving records, particularly in electronics. What's driving that? The answer is new emerging electronics hardware technologies, right? Data center applications, high-performance computing applications, and electric vehicle applications. And so we are unit-driven. We're gonna be driven by MSI, but not all MSI is equal for us. Just like we're gonna be driven by PCB square meters, but not all PCB types are equal for us. Where we focus, where we have a disproportionate amount of share, and where there's more value, is in leading-edge applications. And the leading edge is changing from smartphones to automation, AI, high-performance computing, whatever you wanna call it. And the leading edge in the circuit board market is also changing. And so that's the disconnect that we've seen. Now, as we look forward, the reason we're increasingly optimistic about an inflection in our electronics business is underlying growth rate, that there's both the secular trend that's propelling the business this year and will be durable for multiple years, and a cyclical recovery when we, you know, get out of this funk from a smartphone unit perspective, where we went from selling, you know, 1.5 billion-1.7 billion smartphones a year down to 1.1-1.2. Combining those two things, you get a real growth acceleration. Yeah. So on the point you mentioned, I mean, the secular versus secular debate comes up a lot, as it relates to the business. So you would frame a lot of the growth of 2024 as more secular. I, I guess when I look at it, some of the sell-in rates have maybe improved or recovered. So how can you separate those two, and where would you characterize we are today within that cycle? So it's a very hard question to answer with precision. Clearly, there is a cyclical aspect to 2024 performance because 2023 was just so poor from a smartphone unit perspective. But we're still way below trend in smartphone units, right? And so this year, the Western smartphone OEMs are underselling expectations, right, that we had entering the year, yet our business is achieving record levels. So there was absolutely some level of cyclical recovery in 2024, but more of the outperformance has been driven by secular growth. And another way to frame this is to think about electronics computing; electronics manufacturing capacity is somewhat fixed. And so you've got PCB fabs that have fungibility in terms of what they're making. And so when you have a new source of demand, like data centers, right, that's absorbing capacity from legacy sources of demand like smartphones. So what happens when the smartphone market comes back and this data center demand is still there and growing, capacity gets added. And so that's the, you know, when we look out a couple of years, that's something to be quite excited about, right? Just the volume driven by what has been a fixed capacity environment. And we already see indications that there's gonna be capacity expansion when you look at the semiconductor market, right, where there's been significant new fab capacity investment to support growth in electronics hardware manufacturing capacity, particularly in the high-end applications. Okay. So we talked about the leading-edge high-end applications, a good number of times as it relates to your growth. What are some of the platforms or applications that we should be watching that would be most important to ESI? So when we look at the market versus ESI's performance, we can maybe correctly judge losing share, gaining share, winning in those markets versus performing with the market. Yeah. Look, so again, we are unit-driven. It's just the types of units. And where we, you know, try to benchmark ourselves is we look at PCB square meters, we look at MSI, and we look at our performance in the businesses related to that, and we wanna be doing a point or two better. We have been, clearly. The way that we're doing that is by focusing on our strengths and how we're differentiated in these areas that are inflecting. And so the term that comes up a lot is advanced packaging, which is a generic term. But our businesses, across all of our businesses in electronics, participate in enabling advanced packaging applications. And so we would be looking at OSAT production levels, for example, and making sure that we're outperforming the leading-edge OSATs. So not the lagging, but the leading-edge OSATs because we've got really significant value there, and we believe that our share opportunity is tremendous in next-generation platforms. So those are the types of things I'd be pointing you to. There's not a specific easy indicator anymore, but I'd be looking at OSAT level. Okay. Well, that's helpful. I wanna ask one more near-term, just thinking about some of the data points that have been out more recently, maybe some weaker points on PC, smartphone sell-in maybe slightly better, autos we know is slightly worse. I guess in the context of how you thought about what the fourth quarter looks like, are there enough elements within your control, or maybe new wins or visibility that you have on certain platforms, to say, with all that moving parts, you still expect to be within how you framed the fourth quarter near-term? Yeah. Look, in the fourth quarter, I would say demand with puts and takes is roughly where we expected it would be. The incremental headwind that we didn't expect is currency, right? In the month of November, the dollar strengthened substantially post the election. But the business, you know, I would say is performing in line with what we would've expected, and there's no change to our guidance, coming out of the third quarter. And just to ask about maybe some of the headlines more recently and just generally around China, sheer concerns, any disruption there? I know we've talked about this before in relationship to ESI sales, but how do you see yourselves impacted or maybe unimpacted by some of those changes? What is an impactful change for you guys versus just a reallocation of the supply chain? So we operate locally. We buy, manufacture, and sell locally. And so tariffs don't impact our cost structure, right? What impact they'll have on demand is hard to know, right? So do the tariffs end up being borne by the consumer, and does that have an impact on consumers' willingness to buy, and therefore end units could be? But that's, you know, we're in the realm of speculation at that point. But, you know, our P&L should be insulated from tariffs. The longer-term trend that was really precipitated in the previous Trump administration was this notion of China plus one, where the supply chain is moving away from China into Southeast Asia, some, you know, some manufacturing's moving into Mexico, South America. But we're seeing, you know, non-Chinese and Chinese suppliers building capacity in Vietnam, and Thailand, and India all throughout Southeast Asia. That's helpful for us. We're in those countries already. We've got capability to serve, and we don't have local Chinese competition, by and large, in those jurisdictions, so our margin opportunity is actually greater, so that's a trend that started several years ago and is only gaining momentum. There's a tailwind for us. Okay. That makes sense, and thinking a little bit longer-term, earlier this year, you talked about high single-digit revenue growth on a five-year basis within electronics. You guys are, you know, doing within that range this year, maybe a little bit better in some quarters. I guess three to five years out, we could talk about some of the secular trends. How do you see that playing out over the next one to two years? Is there visibility in pipelines or wins to be able to deliver that in the near-medium term, or how should investors be thinking about that? So it's a short-cycle business. So it's hard for us to say with any certainty what demand is gonna look like, you know, in four quarters, five quarters, six quarters. But sitting here today, forecasts for 2025 are for a stronger electronics environment than 2024, right? And when you look at 2024, we just talked about this. Was it cyclic, cyclical, or secular in 2024? You know, it has not been a particularly strong year in electronics. Look at MSI. It's, you know, low single digits. Yes, there's been improved sell-through versus sell-in in certain pockets of the channel. But when you look broadly at the electronics market, this hasn't been a banner year other than a few segments that were driven more by price than volume. And we're volume-driven. So as we look at 2025, again, just based on, you know, forecasts, which are always wrong, but they're directionally super, you know, positive. The forecasts are for a significantly stronger electronics environment in 2025, 2024, so the near-term outlook is positive, based on what I wouldn't call hard data, but sentiment for 2025, and the trends propelling 2025 should be durable into 2026. Okay. I think we've talked a lot about AI and data centers to a broader extent, and I think when we've looked at a lot of ESI's mix and portfolio in the past, you can look at a chip and a smartphone and talk about the density and that increasing. How do we think about next-gen AI and what that means for ESI, in terms of content packaging, where there's maybe newer applications that drive some additional growth? Yeah. So the way we're solving increasing increases in computing power is not with smaller nodes anymore. By and large, it's through architectures and stacking chips, and so that's this notion of advanced packaging. We're here at a tech conference, so I probably don't need to get as technical as I would at a materials conference, but Element Solutions has a highly differentiated capability and offering for advanced packaging applications. We have material sets that speak to all of the places the electron goes from through the circuit board into the chip and through the chip, and we've been leaning into this market for several years and really orienting our innovation and technical service capabilities, applications know-how towards these markets. We're the only company that has that breadth of portfolio, and so what that means is we can talk to customers on a systems level. We're not talking about a product. We're talking about a set of materials that deliver a certain outcome. And that dialogue is different than someone who's got a product for a certain application. And that has improved our mind share and seat at the table with innovators here. The other dynamic that's very different today with advanced packaging than in legacy innovation in electronics hardware. Around it, there was a standard mentality of trying to scale down before. Let's get to the next smaller node. Now, with packaging, it's a completely non-standard, heterogeneous set of approaches to chip design. And so when you lose standardization, you have customization. And customization requires new material sets. And this customization is not only happening at the OSAT level. Boundaries are getting into packaging. And then the hyperscalers have their own chip designs. There's been a proliferation of potential customers, all with unique problems. When we're solving a specific custom problem, our value proposition is differentiated, which speaks to margin opportunity. So as we look out over several years from now, we're in a really great position to capture share, capture value from this inflection driven by advanced packaging. Yeah. So there's two good points in there. So first, I think we could talk about Element Solutions versus peers, but there's no real similar peer set in terms of the materials and components that make up the portfolio. So a level deeper on that would be what's different within ESI's portfolio, which maybe gives you more of a unique seat at that table versus some of the competitors. So, you know, what do our products do in electronics fundamentally? They're circuit pathways. They're circuit pathways on printed circuit boards. So the process of turning a laminate, a piece of plastic, into a printed circuit board is chemistry and mechanical. We speak to all of those chemical process steps. They're circuit pathways in silicon. So, you know, our damascene copper is used to build the interconnect. And they're attachment mechanisms. So that's putting the silicon, the die, into its package or putting that package onto a printed circuit board. So it's all of the places that an electron goes. No one else has that breadth of portfolio. And our specialty is the smallest circuit pathways. So as the boards get more dense, the pitch, meaning the size of the line on the board, gets smaller. You know, that's where we shine. As the boards get thicker and the holes get smaller, metallizing those holes, that's where we shine. When you have finer pitch circuit pathways, you need finer pitch solder paste, so the powders that we're making, that's where we shine at the smallest pitch sizes and the innovation we've brought in with ViaForm, now that we own that product, soup to nuts, has also given us enhanced mind share at the foundry level and so it really is a unique offering set. The other problems that are emerging, things like power density, right, where you've got more power going through these boards than it than before, and we have, you know, our Argomax thermal capability that that's been tremendously successful in electric vehicles and is moving into other applications. Kuprion, which is a new product we brought into the portfolio last year, also has a breadth of applications for power, for thermal management and power-dense circuit boards and die attach. So the portfolio intentionally and somewhat just by luck of where these businesses grew up is primed for this inflection driven by advanced packaging. I think along those lines. The assembly business is about half of electronics, lower if you exclude the metals pass-through. Generally, that's grown a bit less. There's been a lot of conversations about mix-uplift over time, which just how you described the power conversion, the power density, the connections. Do you see that as something that your customers are viewing that differently from a value perspective? The volume side is a separate piece of it, but is there a mix element that really starts to matter more meaningfully either today or in the next couple of years that changes the profitability there? Yeah, so the assembly business, right, as you rightly pointed out, it's about half of electronics, but $200 million of that is just pass-through metal prices. So when you back that out, you know, it's margins ex-metal are higher than our circuitry business. And so you think, "Wait, you know, this is a metal business. How does that make sense?" Well, it gives you a sense for how the technology is valued by the supply chain. That wasn't the case several years ago. So we've spent a lot of time mixing that portfolio up. What do we do in the assembly business? It runs the gamut. But the reason that business has been a little softer from a volume perspective, the two reasons. One, it's more industrially exposed. The industrial economy's been softer. Two, we've been migrating away from some of the bulk lower-margin metal business and more towards higher- value applications. What's a higher- value application? I just got through talking about very fine powders for solder paste. Another one is alloys. So there's been a lot of innovation around higher reliability alloys, either with better attachment properties, or better thermal properties. One area of innovation's been low-temperature soldering. So when you've got a flexible printed circuit board, you can't apply the same amount of heat to it because it might melt, given what the laminate is made from. So we've innovated to have solders that melt at lower temperatures, so you don't damage the circuit board. When you start looking at the technology in that assembly business, it's actually quite important in the broader electronics hardware supply chain. We've been leading that innovation. We're a market leader in that business. Since we've been with Element Solutions, we've taken the ex-metal margin, gross margins in that business up over 500 basis points. And that's innovation and mix. So there's a great growth opportunity there and value capture opportunity in that. Yeah, so coming back to advanced packaging, so it's interesting when you talk about the heterogeneity of some of the designs. How do you see that progressing over the next two to three years? Do designs get more custom, more different for different applications, or do they start to converge? And which scenario would be good or bad for Element Solutions? You know, it's hard for us to have a view on that. I would say that the number of engagements we have with different customers, and specifiers, it continues to grow. And the amount of interest that we've had has surprised us. One of the things that Kuprion brings is it's a new material. And so we're seeing new designs being developed that are based on the capabilities of active copper, which is the Kuprion product. So we're basically enabling customers to design to come up with new designs because of what we can do, as opposed to customers coming to us saying, "Here's our design. Help us with a material set to allow for that." So if anything, that's an indicator that there's still design proliferation happening as opposed to standardization. Where that goes in three to five years is hard to say. Yep. Understood. And maybe let's talk a little bit more about the Kuprion business in terms of what applications does that become really attractive for? What does that open the door for ESI, be it either new designs, content applications? And what's the timeline that we should be thinking about in terms of that becoming more commercial? So all the proof points in active copper continue to be incrementally positive, right? So this is for those who aren't familiar with Kuprion. This is a technology we acquired last year that was a materials science technology. And we've been doing a lot of work on applications. What's special about it is it's sintered nanoparticulate copper. So it allows for a different set of applications than plating a printed circuit board with electroplating copper or die attach, where you'd use a different material in the semiconductor market, thermal management applications. It spans the breadth of what we do in electronics business. We stopped customer engagement a few months, a few quarters ago because we had so much pull. We're still standing up our own internal supply chain to make the product at high volume and helping develop the high-volume manufacturing processes that our customers will use, right? We know it works. We can make it in small batches. We know it works for our customers. They can make products in small batches. We need to scale that up. Right now, our focus is really on supply chain. That's gonna be going on for at least another, you know, several quarters. We're standing up the ability to make this in scale to support the customer demand from just the existing customer base. There's a long line of customers that we've said not yet to. What is special about it? When you can screen print copper, you can come up with custom designs that allow for better thermal management. Screen print copper. You can print thicker circuits that can handle more power. You can use a copper that doesn't require solder, or when you use a material that doesn't require heat to adhere, you can do die attach with less cracking, right? So one of the issues with die attach is when you put pressure on the silicon, it can crack. And now you've got a finished chip and board you need to throw out, right? So it improves yield. So it's a plethora of really high-value applications that have a dramatic impact on productivity and yield for our customers at a relatively low cost. So it's a very compelling opportunity. The revenue is not, you know, the big revenue isn't a 2025 opportunity, but the pipeline is very strong. Margins are very strong. And the opportunity set continues to grow. When you talk about that range, how much of that would be new applications for ESI, new materials? How much of that becomes, "We're replacing this material with that material"? Maybe it's more of a trade-off. So thinking about, does this open up a lot more new markets for ESI? I think it does open up new markets, and it increases value from legacy markets. But you know, we're still in the early innings of this. Yeah. Maybe in the last couple of minutes, kinda so we talked a bit about portfolio, and Kuprion's a good example of capital allocation where you invest in innovation. Maybe at a high level, how do you think about innovation for ESI? A lot of the new advances ends up being a new material set, a new problem. Maybe it needs a new solution. Are you investing in that organically? You think about M&A. Yeah. How do you do that to make sure you're on the leading edge five years from now? Yeah. So, so we've got five different businesses after the sale of our graphics business. And our investment in R&D is not just our R&D line. It's also our technical service folks who are close to the customer, running applications, labs, making local adjustments for local manufacturing processes. So we are, you know, when you look at just R&D as a percentage of sales, amortized against across our whole portfolio, including metal, you get a, a number that's misleadingly low, right? The actual investment in R&D as a percentage of sales in our semiconductor business and our circuitry business is much higher than what you'd see in that P&L. But our R&D is mostly D. It's mostly product development, right? Our customers have a limited number of counterparties who can solve their problems. And so they do technology roadmap exchanges where they come to us, they tell us what they're working on, and they rely on us to help introduce, innovate a new product to meet that need. And most of that innovation is incremental product development, where we're taking what we have today and adjusting it to meet that future need. So it's high-returning product development. It's not basic research. In general, in our markets, there are not blockbuster new materials that are introduced that change the industry. That happens rarely. We believe Kuprion is one of those. And we believe that we're more likely to get our hands on that by buying it than by spending a lot of money with internal R&D people. So that's been our approach. Our innovation has been meeting the needs of our industry. It's improved, right? We have, I believe, improved the depth of our relationships with the leading-edge partners in our supply chains over the past several years, and I believe that's evident by our outgrowth, by our margin expansion, and by, you know, our conviction in the inflection that we're gonna see and, and, and really participate in over the next couple of years. So, how do you think about the allocation of, I mean, you have a good problem in that to have with free cash flow. It's quite a high conversion rate. Yeah. How do you weigh the investment in a new technology versus share buybacks or some other alternative? We're really opportunistic with regard to capital allocation. You know, as I flip it into 2025, I think capital allocation's gonna become more front of mind. The balance sheet, you know, as strong as it's been since we've been Element Solutions. Our framework around M&A and capital allocation is unchanged from where we started, right? Which is, you know, we're gonna invest behind our businesses we understand, behind our people, companies that make our business better and are better inside of our company. That can look like a technology acquisition. That can look like, you know, market consolidation. That can look like entering a very near adjacency in a conservative way, always looking at cash-on-cash returns versus free cash flow. We'll buy our shares, if we'd rather buy our shares than a business at an equal cash-on-cash return. And if there's nothing to do, we'll wait for the right opportunity to come across our desk or to become available, rather. That sounds good. It's a tight schedule here at the technology conference, so we'll wrap it there. Ben's around all day if anybody has further questions. I wanna thank everyone for joining. Thank you.