Good morning, and welcome to the Griffon Corporation Fiscal Third Quarter 2023 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad. To withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to Brian Harris, CFO. Please go ahead. Thank you, Debbie. Good morning, everyone. With me on the call is Ron Kramer, our Chairman and Chief Executive Officer. The call is being recorded and will be available for playback, the details of which are in our press release distributed earlier today. As in the past, our comments will include forward-looking statements about the company's performance based on our views of Griffon's businesses and the environments in which they operate. Such statements are subject to inherent risks and uncertainties that can change as the world changes. Please see the cautionary statements in today's press release and in our various Securities and Exchange Commission filings. Some of today's remarks will adjust for those items that affect comparability between reporting periods. These items are explained in our non-GAAP reconciliations, including in our press release. I'll turn the call over to Ron. Thanks, Brian. Good morning, everyone, and thank you for joining us. As you can see from our third quarter results, Griffon's financial performance continues to exceed expectations. Our results were driven by the outstanding performance of our Home and Building Products, HBP segment, which continued to see year-over-year growth in commercial volume. Residential volume decreased as expected year-over-year as backlog levels normalized. HBP had favorable price and mix across all products and channels. HBP's performance is supported by increased investment in business development for both residential and commercial, following two years of reduced sales and marketing activity due to elevated backlog and long lead times. HBP continues to invest in productivity and innovation to further drive growth. Clopay has fundamentally raised the bar for performance expectations. Turning to the Consumer and Professional Products segment, CPP's results continue to reflect challenging market conditions. All channels and geographies were affected by reduced consumer demand and elevated customer inventory levels. As we announced last quarter, to address the impact of these market conditions on certain U.S. product lines, CPP is expanding its global sourcing strategy to include long-handle tools, material handling, and wood storage and organizational product lines that are currently manufactured and sold in the U.S. market. By utilizing an asset-light structure, CPP's U.S. operations will be better positioned to serve customers with a more flexible and cost-effective global sourcing model. The global sourcing project is off to a solid start and remains on schedule and within budget. Specifically, there's been significant progress on our higher-profile work streams around plant closures and ramping up suppliers. We'll provide more detail on our year, year-end earnings call in November. Turning to capital allocation. During the quarter, we announced actions to enhance shareholder value that included a 25% increase to our regular quarterly dividend, raising it to $0.125, and a $200 million increase to our share repurchase program that brought the total authorization to $258 million. Earlier today, the Griffon board authorized a $0.125 per share dividend payable on September 14th, 2023, to shareholders of record on August 23. This marks the 48th consecutive quarterly dividend to shareholders, which has grown at an annualized compound rate of 17.6% since we initiated dividends in 2012. During this quarter, we repurchased 2.5 million shares, or approximately 4.4% of our outstanding shares for $85 million at an average price of $33.58 per share. At June 30th, $173 million remained under the share repurchase authorization. We continue to believe there is a significant disconnect between Griffon's share price and the intrinsic value of our businesses. We will remain active and opportunistic with our share repurchases. Turning to our guidance for the year. Based on our third quarter performance and our expectations for the fourth quarter, we are again raising our full-year guidance. We now expect segment-adjusted EBITDA to be $550 million, compared to previous guidance of at least $525 million. In summary, these capital allocation actions and the fiscal 2023 guidance raise reflects the confidence Griffon's board and management has in our strategic plan and outlook, as well as demonstrate our commitment to enhancing both immediate and long-term value to our shareholders. I'll turn it over to Brian for the financial update. Thanks, Ron. I'll start by discussing our third quarter consolidated performance on a continuing basis. Revenue of $683 million decreased by 11%. Adjusted EBITDA before unallocated amounts of $153 million increased by 3%, both in comparison to the prior year quarter, with a margin of 22.3%, an increase of 300 basis points. Gross profit on a GAAP basis for the quarter was $275 million compared to $261 million in the prior year quarter. Excluding items that affect comparability from the current and prior periods, gross profit was $276 million in the current quarter, increasing 4% over the prior year quarter. Gross margin increased by 580 basis points to 40.4%. Third quarter GAAP selling, general, and administrative expenses were $172 million, compared to $157 million in the prior year. Excluding adjusting items from both periods, selling, general, and administrative expenses were $155 million, representing 22.7% of revenue, compared to the prior year of $151 million or 19.6% of revenue. Third quarter GAAP income from continuing operations was $49 million, or $0.90 per share, compared to the prior year period income of $53 million or $0.98 per share. Excluding all items that affect comparability from both periods, current quarter adjusted net income from continuing operations was $70 million or $1.29 per share, compared to the prior year at $66 million or $1.23 per share. Corporate and unallocated expenses, excluding depreciation, were $14 million in the quarter, compared to $13.4 million in the prior year. Our normalized effective tax rate, excluding adjusted items for the quarter, was 28.1% and 28.6% for the year-to-date period. Net capital expenditures were $8 million in the third quarter, compared to $11 million in the prior year quarter. Depreciation and amortization totaled $15.7 million for the third quarter, compared to $17.7 million in the prior year. Regarding our segment performance, revenue for Home and Building Products increased 1% over the prior year quarter, driven by reduced residential volume, partially offset by increased commercial volume and favorable mix and pricing for commercial- both commercial and residential products. Adjusted EBITDA increased 12% compared to the prior-year quarter, driven by reduced material costs, partially offset by increased costs for labor, advertising, and marketing. Consumer and Professional Products revenue decreased 22% from the prior-year. The reduction in revenue was primarily attributable to reduced volume across all channels and geographies, driven by soft consumer demand and elevated customer inventory levels and customer supplier diversification in the U.S. CPP adjusted EBITDA decreased from the prior-year by 36%, primarily due to the unfavorable impact of reduced volume and revenue and its related impact on manufacturing and overhead absorption. These items were partially offset by reduced discretionary spending and improved Hunter Fan performance. In our second quarter earnings release on May 3rd, we announced that CPP is expanding its global sourcing strategy for products manufactured and sold in the U.S. to address evolving market conditions. Utilizing an asset-light model enables CPP to continue providing high-quality products, strengthening its competitive positioning, and leveraging industry-leading service and distribution that our customers and consumers expect. Further, these actions position CPP to achieve target EBITDA margin of 15% and generate substantial additional value to our shareholders. There have been no changes in expected charges, and we'll continue to expect the project to be completed by the end of calendar 2024. In the quarter, end of June 30, CPP incurred pre-tax cash charges of $3.9 million related to the expansion of its global sourcing strategy. Regarding our balance sheet and liquidity, as of June 30, 2023, we had net debt of $1.4 billion and net debt to EBITDA leverage of 2.6x, as calculated based on our debt covenants, compared to $1.3 billion of net debt and 2.5x leverage in the previous quarter, and $1.5 billion of net debt and 2.9x leverage at September 2022 fiscal year-end. I want to highlight that we remain essentially leverage neutral relative to the prior quarter, even after returning $100 million in shareholder capital via a special dividend in May and $85 million in stock buybacks over the course of the third quarter. Regarding our 2023 guidance, given our strong year-to-date financial performance and our expectations for current segment trends to continue through the fourth quarter, we are raising our guidance for full-year segment adjusted EBITDA to $550 million from the previous guidance of $525 million. This EBITDA guidance excludes unallocated costs of $56 million, charges related to the strategic review process of approximately $22 million, and AMES global sourcing expansion charges. In addition, we now expect depreciation to be $45 million versus prior guidance of $50 million, and capital expenditures to be $40 million versus $50 million prior. Other guidance remains unchanged for 2023, including revenue of $2.7 billion, free cash flow to exceed net income, amortization of $22 million, interest expense of $102 million, and a normalized tax rate of approximately 29%. Now I'll turn the call back over to Ron. Thanks, Brian. Before we turn to questions, I want to highlight this morning, Griffon announced that it amended and restated its revolving credit facility to increase the size of that facility to $500 million from $400 million, and extended the maturity to March of 2028 from March of 2025. The closing of our new credit facility continues to provide us with financial and operating flexibility that will support our working capital requirements and positions us to grow our company and further enhance shareholder value. I want to acknowledge the effort and commitment the employees and management teams of our businesses continue to demonstrate. It's because of them that we maintain industry-leading levels of product quality and customer service, and our brands remain highly sought after and are leaders in their categories. Our Home and Building Products segment continues to perform well and sees long-term tailwinds for the business, driven by healthy demand for our commercial products and from the historically resilient residential repair and remodel market. We remain excited about the prospects for our Consumer and Professional Products segment. Globally, CPP is addressing the current consumer market environment by rationalizing its cost structure and leveraging its global sourcing capability to realize our goal of 15% EBITDA margins. Griffon's board and management remain very confident in our outlook and strategic plan. We will continue to use the strong operating performance of our business and its free cash flow to deliver long-term value to our shareholders. Even with our impressive results year to date, we continue to believe the best is yet to come. Operator, we'll take any questions. We will now begin the question-and-answer session. To ask a question, you may press star, then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star, then two. We ask that you please limit your questions to one question and one follow-up. At this time, we will pause momentarily to assemble our roster. The first question is from Bob Labick with CJS Securities. Please go ahead. Hi, good morning. It's actually Lee Jagoda for Bob this morning. Morning, Lee. Good morning, Lee. Morning. Can we start with the doors business and maybe talk about the visibility in demand across the residential and commercial business? Just as a follow-up to that, maybe talk about the progress and potential synergies you see integrating Clopay to the existing commercial dealer network. Sure. So as far as visibility, you know, we continue to expect good commercial demand. We have benefited greatly by converting historical CornellCookson dealers to use Clopay commercial sectional product, and that has been very successful and will be ongoing for the foreseeable future. On the residential side, we have, from a unit sales standpoint, we have difficult comps until we get through the first half of fiscal 2024 because of historical backlog during the prior period, the period this year. Going forward, we expect orders to improve as we have invested more in marketing to recapture the market share that was partially lost while we had high backlog. Got it. Then on the CPP side, maybe are there any initial findings from your global sourcing initiatives that you're trying to implement in the U.S.? How does your existing global sourcing infrastructure benefit the push towards the U.S. global sourcing? Sure. We're early in the process, but so far, you know, we see this being as successful as we expected. We'll update you more in November. Far as, you know, our capability that we already have regarding sourcing, we already source partially in the U.S. to begin with, and Australia and the U.K., and we're leveraging that supplier network to source for the U.S. product lines that we're converting. Operator? Operator, next question, please. Excuse me. The next question is with, from Tim Wojs with Baird. Please go ahead. Tim? Maybe just on the HBP business. You know, on, on the pricing side, you know, could you maybe talk to what you're seeing there? I think there's a, I think there's a worry out there that the industry needs to give back some level of pricing, and I, and I guess I'm just curious, you know, what you're seeing, you know, how you would kind of respond to that, and, and as we look at next year, just anything to think about pricing mix or, or, or kind of raw materials in HBP. Sure. As far as raw materials, you know, the market will dictate mostly, how that occurs going forward. I'm just sort of going with your questions backwards. As far as pricing, you know, we are priced in line with the market. We continue to expect good mix as we go forward. We're constantly coming up with new products, innovative products on both the commercial and residential side. I refer you to our margins year to date, regarding, you know, the strength of the pricing in our business. Tim, it's Ron. I'll just add to it. You know, we're the market leader, and we have the premium product and premium service, the best dealer network, and we see ourselves taking market share and have no worries about pricing. Okay. Okay, very good. You know, you outlined some, some longer-term margin targets in Home and Building Products that I think were in the mid to high 20% range. You know, the business is still operating, you know, really well at, you know, 33%, you know, margins this quarter and last and the last couple quarters. You look at steel down, you look at NBI down, and maybe, maybe other inputs are actually, you know, a bit more favorable. I, I guess, can you maybe just kind of walk me through the difference there and if, if I'm, if I'm thinking, you know, if there's anything there that, that I should think differently about, because, and if anything, I'd almost think that, that margins have scope to, to maybe even move higher? ... As far as those, the outlook for margins that we posted, that is a long-term view and considers the cycle. Currently, you know, we aren't seeing pressure on margin, and the business is doing very well. We were just being perhaps a little conservative and considering, you know, what could potentially happen in the future, but nothing is visible yet. The next question is from Julio Romero with Sidoti & Company. Please go ahead. Great. Thanks. Good morning. We wanted to piggyback on Lee's question earlier about HBP and converting the CornellCookson dealers. You guys mentioned you've been successful with those conversions. Could you expand on that a little bit? Maybe, you know, give us, you know, what's, what's a common pushback from those dealers or a common rebuttal, and, and how do you kind of overcome that? Sure. Actually, it's the opposite. We have dealers lining up to be converted. We are being thoughtful in bringing on new customers to make sure that we service them with a high level of service that they should and expect, and that we've been able to provide our other dealers. This is really a matter of thoughtfully and carefully converting dealers one by one, training, making sure they understand our products, making sure the systems are working, and so far it's been successful, and we continue to expect it will be successful. Got it. That's very helpful. Then on CPP, you, you mentioned you've seen significant progress on ramping up suppliers for the global sourcing strategy. What do lead times turn into with the global sourcing strategy, compared to previously? I assume you mean, getting things into our distribution centers from wherever we're sourcing from. Exactly. Those lead times will change, but we are used to dealing with that because we currently source roughly 20% to 30% of what we sell in the U.S. You know, that will be in our calculus to make sure we have, A, inventory on hand at adequate levels to service our customers, in the way they've been serviced before, and B, you know, we understand the, the timing that it'll take to get product, and we'll be, ensuring that we have our orders in on a timely basis to get the product. The next question is from Trey Grooms with Stephens Inc. Please go ahead. Good morning. This is Noah Merkousko on for Trey. Good morning, Noah. Morning. Switching gears here over CPP, just on the demand outlook there, I mean, I know you've called out, you know, there continues to be a weak consumer, sounds like pretty globally there, and inventories remain high. Again, just any kind of forward-looking expectations as we think about demand for that segment, and when you believe inventories in the channel might be right-sized? Sure. You know, we expect it to take time. We're talking multiple quarters. It's hard to know exactly when. There's other factors, such as weather, that could change the calculus. But we are looking... You know, 2024 is gonna look, from a consumer standpoint, similar, I think, to 2023, and it's gonna take most of 2024 to normalize inventory at most, for most products and locations. Yeah, we, we view this as positioning the company for the long run, and there will be a recovery. You know, those products, will be a more efficient, manufacturer, designer, sourcer, and the 15% EBITDA target, you know, that we have out there, we believe we'll achieve beyond the fiscal 2024 year. Got it. That makes sense. On the, the HBP business, you know, you mentioned you're a market leader. Can you help us understand what the market structure looks like, how many players there are, and how concentrated is at the top? Maybe, you know, you mentioned regaining market share and investing in more marketing now. Maybe if you could just help quantify what that looks like? Sure. As far as the market, there's four large players that make up about 75% of the market, approximately. Pretty consolidated at that level. As far as the marketing, yeah, so while we had increased backlog, you know, some of our customers, understandably, if they wanted a door faster than we were able to provide it, went to other providers. That was a matter of not wanting to wait, not necessarily that they wanted the other product. Now that our backlogs have normalized and we can meet our customer demand typically in approximately two weeks, you know, we are regaining that market share and the investment in marketing to allow people to know about our new products and our capability to provide them those products timely is being helpful. The next question is from Sam Darkatsh with Raymond James. Please go ahead. Hey, good morning, Ron. Good morning, Brian. How are you? Doing well. How are you, Sam? I'm terrific, thank you. Just, most of my questions have been asked and answered. Just a couple of follow-ups on, on prior inquiries. I think you talk a lot about garage doors within HBP, but, but could you talk a little bit more about what CornellCookson specific profitability looks like, today versus pre-pandemic, and where that is versus the overall HBP, margin level? Just trying to get a sense of the sustainability there versus the garage door business. Sure. I'll, I'll take you back to when we purchased CornellCookson, and it was approximately a 9% business on $200 million of revenue. You know, there was-- we knew we had a lot of opportunity there and a lot of work to get there in integrating that with Clopay, and I mentioned the conversion of dealers to our commercial sectional product. All of those have contributed to a much stronger business. Currently, on balance, our commercial margins are similar to our residential margins. It varies by product, but on balance, they're similar. We continue to see very nice growth in the commercial business and believe that that's going to continue. This is not my follow-up question, so don't, don't cut me off just yet. Do you think the sustainability, do you think the sustainability of the CornellCookson margins are similar to that of garage doors? I mean, there, there's never, to our knowledge, ever been a price cut in resi garage doors, but you'd figure rolling steel doors might be a little bit more commodity sensitive with pricing. Could you give us a sense of how you compare and contrast the, the margin sensitivity or sustainability with commercial versus resi? Yeah, they're a bit of a different model. On the commercial side, it's, I'll call it job at a time, where you're going out, and bidding with a full suite of products and services, along with dealers to get those jobs done. Though the product itself is of excellent quality and sought after by, those who are, are purchasing it, it's our capability to not only build the quality doors, but to get them there on time, get them installed properly, and having a full suite of products that gives us a, a, a leading edge, in getting those jobs. It's more one at a time, and those are bid, so the pricing, you know, may adjust as each bid goes, but our overall capability gives us strength. Then here's my, my actual follow-up question. This is fine-tuning what Tim was asking earlier around pricing, both what you're seeing and perspectively in HBP. I, I guess it looks like in the quarter, that pricing for HBP on a two-year stack moderated a little bit sequentially from last quarter. Now, that's price mix, so I, I'm not sure if that's actually like for like, but it... Are, are you seeing price degradation or price pressure in HBP sequentially? If not, what, what might explain the, the little bit of the softness, on a two-year stack? Yeah. Year-over-year, you know, price mix continues to be good. What you're really seeing is less price, more mix, and pricing has remained relatively stable. You know, there's always the mix element to that, but it's remained stable. Oh, by the way, back on the commercial, I, I forgot to mention that commercial products have a much higher component of labor than residential products, as part of the consideration of what I was talking about. Again, if you have a question, please press star then one. The next question is from Justin Bergner with Gabelli Funds. Please go ahead. Good morning, Ron. Good morning, Brian. Nice quarter. Thank you. Good morning. Thanks, Justin. One two-part, just clarification question then, and one follow-up. I noticed the Hunter margins, you know, were really strong this quarter, close to 30%. Any comment there? The other clarification question was just regarding the repurchases. It was $85 million, but I think there's, like, a $98 million purchase of shares for treasury number in the cash flow statement, so just trying to reconcile those two. Sure. On the repurchases, there could be some elements of vesting that affect that number. I believe that's the difference between true repurchases and the vesting netting of shares when they vest. On the Hunter margins, last year, the Hunter is seasonal. Generally, Q3 and Q4 are generally the stronger times of the year. Last year was burdened with significant freight costs that we did not have this year, is the major driver there. Okay. Are those margins sort of sustainable at this level? I mean, that high twenties, or is there something unusual that sort of helped them this quarter? For this period of the year, those margins are not abnormal. Over the entire year, you're talking a, you know, plus the 20% give or take margin business. Gotcha. Then, my follow-up just on the commercial HBP business. You know, some companies in the industrial space are talking about a weakening sort of market for, you know, warehouse-related demand. Are you seeing that come through or maybe, you know, looking out a quarter or two? Are you in the later innings of this, you know, dealer switch, you know, for CornellCookson dealers to pick up Clopay sectional, or you would say you're more early to middle innings? No, we're in the middle innings for the switch. As far as demand, we are continuing to see stronger demand for our products in the space. This concludes the question and answer session. I would like to turn the conference back over to Ron Kramer for any closing remarks. Thank you. Be well. We look forward to speaking to you in November. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.