Good day, and thank you for standing by. Welcome to the Innospec's second quarter 2023 earnings release and conference call. At this time, all participants are in listen only mode. After the speaker presentation, there will be the question and answer session. To ask a question during the session, you need to press star one one on your telephone keypad. You will then hear an automatic message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to our speaker today, David Jones. Please go ahead. Thank you. Welcome to Innospec's second quarter earnings call. This is David Jones, and I'm Innospec's General Counsel and Chief Compliance Officer. The earnings release for the quarter and this presentation are posted on the company's website. During this call, we will make forward-looking statements which are predictions, projections, and other statements about future events. These statements are based on current expectations and assumptions that are subject to risks and uncertainties that could cause actual results to differ materially from anticipated results implied by such forward-looking statements. The risks and uncertainties are detailed in Innospec's 10-K, 10-Qs, and other filings with the SEC. Please see the SEC site and Innospec's site for these and related documents. In our discussions today, we've also included non-GAAP financial measures. A reconciliation to the most directly comparable GAAP financial measure is contained in the earnings release. The non-GAAP financial measures should not be considered as a substitute for or superior to those prepared in accordance with GAAP. They're included as additional items to aid investor understanding of the company's performance, in addition to the impact that these items and events had on financial results. With me today from Innospec are Patrick Williams, President and Chief Executive Officer, and Ian Cleminson, Executive Vice President and Chief Financial Officer. With that, I turn it over to you, Patrick. Thank you, David. Welcome everyone to Innospec's second quarter 2023 conference call. Overall, this was another good quarter for Innospec. Excellent results in Oilfield Services continued to offset weaker activity in Performance Chemicals. In Fuel Specialties, we have taken a further charge to exit our trading relationship in Brazil, where inventory was misappropriated in the first quarter. Excluding this $8 million charge, which reduced our EPS by $0.21, our sales and EBITDA grew and gross margins improved over the prior year. As expected, Performance Chemicals was again impacted by customer destocking and high-cost inventory, which drove volumes, margins, and mix lower in the quarter. While these headwinds will likely carry into the second half of the year, we expect our new personal care contracts to drive sequential sales, operating income, and margin improvement. Our priorities remain focused on executing sequential sales and margin improvement in order to return to our operating income run rate to 2022 levels. In Fuel Specialties, continued price action and slowing inflation partially offset lower volumes in the quarter. As noted in our earnings release, adjusting for the $8 million Brazil charge, gross margins were unchanged versus the same quarter last year and remain in our target range of 32%-35%. We do not expect any further charges related to Brazil, and we expect gross margins to remain in this range for the balance of 2023. In terms of operating margins, our target continues to be 19%-21%. We will remain focused on growing sales while maintaining margins as a key focus and opportunity for the global fuels specialties team. Oilfield Services had another very impressive quarter. Continued strong activity in production chemicals, combined with further sequential improvement in our other oilfield segments, drove significant organic growth. Operating income was over 6x the prior year, and growth margin expanded by 9.9 percentage points. In the quarter, we anticipate that sequential operating income will moderate on lower production chemicals activity, but we remain on track for significant full year growth in 2023. We continue to pursue top line and margin expansion opportunities across all our oilfield segments. Now I will turn the call over to Ian Cleminson, who will review our financial results in more detail. I will return with some concluding comments. After that, Ian and I will take your questions. Ian? Thanks, Patrick. Turning to slide 7 in the presentation, the company's total revenues for the second quarter were $480.4 million, a 3% increase from $457.6 million a year ago. Overall gross margin increased by 1.4 percentage points from last year to 31.3%. EBITDA for the quarter was $46.2 million, compared to $52.9 million last year, and net income for the quarter was $28.9 million, compared to $32.3 million a year ago. Our GAAP earnings per share were $1.16, including special items, the net effects of which decreased our second quarter earnings by $0.12 per share. A year ago, we reported GAAP earnings per share of $1.29, which included a negative impact from special items of $0.29 per share. Excluding special items in both years, our Adjusted EPS for the quarter was $1.28, compared to $1.58 a year ago. Our Adjusted EPS of $1.28 includes the $8 million charge from exiting the Brazil trading relationship, which reduced our EPS by $0.21. We do not expect any further charges related to this matter, and we continue to pursue both legal and insurance recoveries. Turning to slide 8, revenues in Performance Chemicals in the second quarter were $127.8 million, down 24% from last year's $169 million, driven by a negative mix of 8% and a volume decline of 16%. Gross margins of 17.2% decreased by 8.6 percentage points compared to 25.8% in the same quarter in 2022, due to a weaker sales mix, higher cost inventory, and adverse manufacturing variances resulting from lower production volumes. Operating income decreased 68% from last year to $9.2 million. Moving on to slide 9. Revenues in Fuel Specialties for the second quarter were $154.2 million, down 13% from $176.4 million reported a year ago. A positive price mix of 3% partially offset a 16% reduction in volume. Fuel Specialties gross margins of 29.1% were 3.2 percentage points below the same quarter last year. Operating income of $17.1 million was down from $31.5 million a year ago. Adjusting for the $8 million Brazil charge, Adjusted gross margins were unchanged versus the same quarter last year, and operating income was $25.1 million. Moving on to slide 10. Revenues in Oilfield Services for the quarter were $198.4 million, up 62% from $122.2 million in the second quarter last year. Gross margins of 42.1% were up 9.9 percentage points on last year's 32.2%. Operating income of $28 million was a $23.5 million increase over the $4.5 million in the prior year. Turning to slide 11. Corporate costs for the quarter were $20.1 million, compared with $18.5 million a year ago, as lower share-based compensation accruals partially offset acquisition-related and other costs. The effective tax rate for the quarter was 21%, compared to 23.6% a year ago. The decrease in the effective rate was primarily because a lower proportion of the company's profits were generated in higher tax jurisdictions. Moving on to slide 12. Free cash generation for the quarter was very strong, with an operating cash inflow of $55 million before capital expenditures of $17.3 million. As of June 30th, Innospec had $165.9 million in cash and cash equivalents and no debt. Now I'll turn it back over to Patrick for some final comments. Thanks, Ian. This was another good overall quarter for Innospec. Throughout the first half of 2023, our balanced portfolio has performed very well in the face of significant end market headwinds. Adjusted for the Brazil charge, we delivered EBITDA growth and gross margin expansion over last year. As destocking runs its course and we return to normal customer order patterns, our business teams will stay focused on the key drivers of Innospec's long-term growth, namely best-in-class innovation and customer service. With excellent cash flow in the quarter and net cash of over $165 million, we continue to redeliver on our record of returning value to shareholders, investing in organic growth, and pursuing complementary M&A. This quarter, we continued to return value to shareholders with our $17.2 million semi-annual dividend and $0.6 million of share repurchases. In partnership with our customers, we remain well placed for long-term growth. Now I will turn the call over to the operator, and Ian and I will take your questions. Thank you. Dear participants, as a reminder, if you wish to ask a question, please press star one one on your telephone keypad and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. This will take a few moments. Now, we're going to take our first question. The question comes from the line of Mike Harrison from Seaport Research Partners. Your line is open. Please ask your question. Hi, good morning. Morning, Mike. Good morning, Mike. Wanted to start with Performance Chemicals. Can you maybe talk in a little bit more detail about what you're seeing in terms of monthly volume trends? And I guess, what are you hearing from customers in terms of the rate of destocking and when you might expect to see those order patterns start to normalize again? Yeah, Mike, it's Patrick. You know, we're starting to see order patterns pick up. We saw obviously a difficult Q1. Volumes were pretty stagnant in Q2, but towards the end of the quarter, we started to see the patterns pick up. We get a fairly good view about 30 days in advance. In the third quarter, we're seeing volumes continue to go up, albeit at a slower pace than, than we'd hoped, but they are going up quarter-over-quarter. You know, we're cautiously optimistic, that the destocking has been put behind us and that the markets are starting to normalize. I would hope and suspect by Q4 and beginning Q1 next year, that we'll be back to somewhat normalized volumes, in activity. All right. You, you categorized in, in Performance Chemicals, that 8% decline, we would normally see that listed as price mix. You just called it mix. What was happening with pricing in the quarter on a year-over-year basis? Can you give some more color on what drove your mix lower? Yeah, Mike, this is Ian. Yeah, we were really pleased with the ability of the business to hang on to price. We've worked very hard, we're very mindful that the, the sales mix is a little bit off, the sort of higher end, higher margin business is down year-over-year. But the business has been really disciplined in maintaining prices, and that's not been easy against the, the sort of that high inflation backdrop, and a lot of customer pressure. Yeah, great job by the business there. And that's why we didn't call it out as price and mix. It's just mix this quarter. All right. Just curious on the, the Fuel Specialties business and the volume decline you showed there. I know that some of those prior declines were related to some of the lower margin additives that you might just be reselling, and you kind of exit that business or participate in that business on a more opportunistic basis. It seems like this sequential step down that we've seen in revenue was a little bit bigger than what we might normally expect, just due to seasonality. I'm just curious, is there some destocking that you saw from your customers in that Fuel Specialties business, or maybe any other changes going on in underlying demand there? Yeah, I think you've probably covered it, Mike. You know, we, we certainly saw some higher volume, lower margin business drop away year-over-year, very similar to what we saw in Q1. You know, we've not seen any destocking, and I think there's probably a little bit more seasonality in the Fuel Specialties business. The last couple of years, it's been relatively flat as we've come out the pandemic. This year, as we've come off the winter season, we do feel like Q2 and Q3 will be a little bit lower based on the seasonality of the business and we're back in Q4. Yeah, Mike, it wasn't, it wasn't a big concern when we looked at it, because we did do a deep dive into that. As Ian said, it was some commodity products that dropped off, like cetane. There was a lower Avtel quarter. There was nothing really that concerned us. There's no loss of customers or any of that, that, that you would immediately look at and ask the, the business. I think overall, we're, we're not concerned whatsoever with, with, the volumes that we saw in the quarter. All right. Perfect. Then, my last question is, is maybe just to get a sense of kind of sequentially, where do you see earnings going? Let's, let's adjust out the, the $8 million Brazil impact. Net-net, it, it sounds like the expectation would be that Fuel Specialties would be similar to maybe a little bit better. Performance Chemicals, better, sequentially, and then I don't, I don't know what your expectation is for oil field, sequential decline, but it sounds like that is gonna be a little bit softer sequentially. Net-net, does Q3 look pretty similar to, to Q2, or, or should it be higher? Thank you. Yeah, Mike, let me let me pick up on that one. Patrick will come over the top. Technically, it's my business. Yeah, we expect Performance Chemicals to be improved in Q3 sequentially. Our comments today that we're getting more volume through, we feel a little bit more confident. We started the quarter in better shape. Our expectations there are that we're probably somewhere around $15 million-$20 million of operating income. In Fuel Specialties, again, I think a very similar quarter to what we've had this time around, we'll be in that $25 million+ range. I don't think it'll go above $30 million of operating income. That's, that's our expectations right now. Oilfield is a little bit more difficult. We, we tempered the expectations in parts of that business. We're still seeing tremendous year-over-year growth in our some of our other businesses, but we do think that'll be more in that sort of $15 million-$20 million range in terms of operating income. That could go higher depending on some orders that might come later in the quarter. Our best guess now is around that $15 million-$20 million operating income range. When you package all that up together, Mike, I would expect EPS to be broadly somewhere between $1.40 and $1.50 as we sit here right now, which is very similar to where we are in quarter two. Excellent. Thank you very much. Thanks, Mike. Thank you. Now we're going to take our next question. The next question comes through line of David Silver from C.L. King & Associates. Your line is open. Please ask your question. Yeah. Hi, good morning. Thank you. I'm gonna apologize in advance. I had to join the call just a few minutes late. I do have several questions. Firstly, just if you wouldn't mind, in the Oilfield Services, I mean, this was a record quarter, both revenues and operating income. I, I would just say it's probably the third record quarter in a row. Initially, when there was this pickup, I guess there was a thought that or I think, you know, Ian or Patrick may have commented that there was some initial fill benefits and things like that. You know, the continued strength and especially kind of the outsized performance this quarter, is, is this just share gains or with your new products? You know, if you were to say what's, what's different with this, you know, substantial pickup, you know, maybe if you could just comment on, you know, whether you think it's cyclical, whether it's sustainable, is it the new products? Is it the ex-exit of some competition? Just, if you could kind of characterize, you know, what's led to the considerable strength, let's say, the last three quarters and especially this one, and, you know, your comments on the sustainability of it, let's say, beyond, you know, your comments on the third quarter. Thank you. Yeah, David, it's Patrick. You know, it's a little bit of everything. It's share gain, it's continuing to, continued progress with pricing, and it's global. It's not just one specific area. I think the guys have done a really good job across all of the businesses within Oilfield Specialties to really look at margin expansion, pricing, technology, and share gains. It's really been a little bit of all. You know, when we saw initial fills, we picked up more business. You know, that enabled us to have another strong second quarter. I think, as Ian alluded to in, in the last comments he just made, third quarter kind of remains to be seen. It started out strong. We thought it would moderate. We could get some bigger orders toward the latter part of the quarter that can make it another very strong quarter. There will be some moderation at some point in time. We just don't know when, you know. We think it's going to be this quarter, but it could be the fourth quarter. I think overall, I would say the guys have done a really... and gals, have done a really good job of managing this business. We just got to keep pushing forward and continue on the path that we're on. If I could just follow up, I'd love for you to comment or expand on the last sentence in one of the paragraphs in discussing oilfield. You said we plan to continue pursuing top line and margin expansion opportunities across all oilfield segments. I'm interpreting that as maybe a mix of inorganic and organic opportunities. Maybe if you could just, you know, expand on what that comment, you know, might pertain to. Yeah, let me take that one, David. I think that's really about the discipline in the business, about making sure that when we're growing and that we're getting profitable growth, we're being disciplined on pricing, we're disciplined on growth margins. As Patrick said, you know, the business has done a terrific job, not just over the last quarter, but over the last number of quarters. We've come out the pandemic in a really strong way. They've really focused down hard on what's important to the business and the customer. We've delivered great technology, we've delivered great service, and we're delivering great results, and we couldn't be more pleased with them. It's just about keeping that discipline and focus on pricing, discipline and focus on customers, and we've got full confidence in the teams to go out and execute that. David, it's Patrick again, just to add to Ian's comments. We have a project accelerated across all of our businesses and all of our manufacturing sites, and that's looking at where we can get cost savings. It's looking at where we can raise prices. It's looking at we can change technologies to provide the customer with a better technology at a less expensive cost. So we're looking at everything we can internally to make sure that, A, we're staying competitive, and B, we're taking out as much cost out of the system that we can. That's across all business units and all businesses in general. Got it. Thank you. I'd like to switch over to Performance Chemicals, just quickly. I'd like to pick up on the aspect where you were able to gain new personal care contracts beginning in the third quarter. You know, kind of at the same time that there's a pretty, you know, pretty substantial destocking element going on. I was wondering if you could maybe characterize where the new contract opportunities are coming from. In other words, are your existing customers, you know, seeking access to some of your newer products while they continue to, you know, work down inventories of some of your legacy SKUs? Is this interest from completely new customers you know, just how, how might we think about, you know, within a pretty tough overall environment, the nature or how you would characterize, you know, your ability to gain, gain some new contracts such that, you know, you anticipate sequential improvement, you know, even within a pretty difficult, day-to-day environment? Thank you. Sure, David. Hence why we had a $70 million spend on manufacturing expansion in addition. This is not something that we necessarily closed this year and we're carrying forward in the third and fourth quarter. These were last year's closures that we had to actually build the plant or expand the plant to hit the volume requirements that these customers are looking for. It's, a lot of it is a reformulation to the natural beauty side of the business. You know, 1,4-dioxane, less toxins in the product, more mild, more natural. That's where the market's been heading. That has not stopped. You might have seen a slowdown or some destocking, but a lot of this is what's going on, hence why we think that the third quarter will improve and the fourth quarter should improve as well. We're confident that, you know, as, as the market starts to normalize and the new contracts that start to take effect, that we should see some nice growth in this business moving forward. Okay, maybe one last one, kind of a, a big picture, bigger picture question. I would like to maybe use as a, a starting point, you know, your recent new financing pack, credit facility or, or financing agreement. You know, $250 million base, capacity, plus the opportunity to add $125 million additional. I just, you know, I'm looking at that in the context of, you know, a company that's had an absolutely, you know, pristine balance sheet for, for a few years now. How should... You know, maybe if you could talk about why that, you know, the timing and the size, and the features of that financing package made, made sense for you here? In other words, is this the dry powder you need to do, you know, wave, round after round of organic growth, maybe in Oil fields in, in addition to, you know, the next round, maybe on Performance Chemicals? Or, you know, is this just pure optionality? I mean, you know, so for a company with, with, you know, a fair amount of cash on the balance sheet and a history of not holding on to any debt, you know, how, maybe you could, put us, give us your thinking on, you know, the size and the nature and the timing of that redo of your financing credit facility. Thank you. David, I'm gonna let Ian talk about the, the refinancing, then I'll address a little bit of the M&A activity and the use of capital. Yeah. David, the refinancing is really a rollover of our previous facilities. It's the same in terms of quantum. They were probably due, probably about a year out. They would last. We've renewed that with a slightly different banking group and with probably less covenants. We're in good shape, and it's there, the dry powder, as you call it, it's there and available for the business, just like it has been for the last number of years. Yeah, very supportive bank group, very supportive of the strategy, and we just want to go out and put it to good use. Yeah, David, it's Patrick, just to add to Ian's comments, we're not ashamed of having a pristine balance sheet. You know, you, you've seen from some of the information that we've put out that we are looking at M&A activity. We are looking at some deals. We hope to have something done by end of Q3, early Q4. It won't be a large deal, so it's not necessarily going to affect the balance sheet much. You know, our, our, our, our key is let's focus on organic growth, and as the markets normalize, obviously we'll have to be putting more capital back to work. In addition, you know, we've increased the dividend, which we plan to continue to do so. We've done a little bit of buybacks in the market, and the plan is to have some dry powder for some more M&A as we move forward. I think, as you know, we're very responsible in, in where we deploy cash, and we will remain that way moving forward. Again, we're proud of our balance sheet. We're not gonna stress it, and we're gonna move forward in a very responsible, conservative way. Thank you very much. I appreciate all the color. Thank you. You're welcome. Thank you. Dear speakers, there are no further questions at this time. I would now like to hand over to yourself for any closing remarks. Thank you all for joining us today. Thanks to all our shareholders, customers, and Innospec employees for your interest and support. If you have any further questions about Innospec or matters discussed today, please give us a call. We look forward to meeting up with you again to discuss our third quarter 2023 results in November. Have a great day, everyone. That does conclude our conference for today. Thank you for participating. You may now all disconnect. Have a nice day.