Good day. Thank you for standing by. Welcome to the Kadant fourth quarter 2022 earnings conference call. At this time, all participants are in a listen only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question during the session, you'll need to press star one one on your telephone. You will hear an automated 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 your speaker today, Michael McKenney, Executive Vice President and Chief Financial Officer. Please go ahead, sir. Thank you, Norma. Good morning, everyone. Welcome to Kadant's fourth quarter and full year 2022 earnings call. With me on the call today is Jeff Powell, our President and Chief Executive Officer. Before we begin, let me read our safe harbor statement. Various remarks that we may make today about Kadant's future plans and expectations, financial and operating results and prospects are forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to known and unknown risks and uncertainties that may cause our actual results to differ materially from these forward-looking statements as a result of various important factors, including those outlined at the beginning of our slide presentation and those discussed under the heading Risk Factors in our annual report on Form 10-K for the fiscal year ended January 1, 2022, and subsequent filings with the Securities and Exchange Commission. In addition, any forward-looking statements we make during the webcast represent our views and estimates only as of today. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, even if our views or estimates change. During this webcast, we will refer to some non-GAAP financial measures. These non-GAAP measures are not prepared in accordance with generally accepted accounting principles. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is contained in our fourth quarter and full-year earnings press release, the slides presented on the webcast and discussed in the conference call, which are available in the Investors section of our website at www.kadant.com. Finally, I wanted to note that when we refer to GAAP earnings per share or EPS and adjusted EPS on this call, we are referring to each of these measures as calculated on a diluted basis. With that, I'll turn the call over to Jeff Powell, who will give you an update on Kadant's business and future prospects. Following Jeff's remarks, I'll give an overview of our financial results for the quarter and the year, we will then have a Q&A session. Jeff? Thanks, Mike. Hello, everyone. Thank you for joining us this morning to review our fourth quarter and full year results and discuss our business outlook for 2023. I'm pleased to report the fourth quarter was a strong finish to a record-setting year for Kadant. Despite the challenges brought about by macroeconomic headwinds and lingering supply chain constraints, we had another well-executed quarter. We generated record adjusted EBITDA, which contributed to solid cash flow in the fourth quarter. Strong capital project activity in the first half of the year and robust aftermarket demand led to record revenue in the fourth quarter and the full year. We continued to deliver on our mission to provide technologies and engineered solutions that help our customers advance their operational performance with product innovations that reduce waste or generate more yield with fewer inputs. At the end of 2022, we were honored to be named by Newsweek Magazine as one of America's most responsible companies for the third consecutive year. It's rewarding to be recognized for our efforts in this area. Next, I'd like to review our Q4 financial performance. Q4 revenue was up 6% compared to the fourth quarter of 2021 to a record $232 million. Organic revenue, which excludes acquisitions and the impact of foreign currency translation, was up 13% compared to the same period last year. Despite a larger portion of our Q4 revenue being capital shipments, excellent execution drove our EBITDA margin to a record 21.3%. This record-setting performance was led by our Flow Control segment, I'll provide more detail on the operating segments in a few minutes. Our strong quarterly earnings performance contributed to exceptional full-year performance, which I'll review next on slide seven. Strong demand we experienced in the first half of 2022 moderated in the second half as central bank fiscal policies began to soften demand in some sectors. Our full-year revenue increased 15% to a record $905 million, which included a $41 million negative impact from FX. Adjusted diluted EPS increased to $9.24 per share, exceeding the prior record set last year at $7.83 per share, despite a negative currency translation effect of $0.46 per share. Our full-year adjusted EBITDA was up 19% to a record $189 million or 20.9% of revenue. This record margin performance surpasses our prior record set last year when we achieved 20.3%. We have had a strong strategic focus on improving our margin performance, we are pleased to see these results. As we have previously discussed, a number of our businesses have been implementing our 80/20 program, which is designed to serve our customers even better while strengthening our financial performance. The collective results have been very encouraging, we look forward to continuing to pursue these customer-focused initiatives to create even more value in the coming years. Next, I'd like to review our performance in our three operating segments. Our Flow Control segment continued to show strength in the fourth quarter, with revenue up 17% to a record $91 million. Excluding the unfavorable impact of FX, revenue was up 24%. Aftermarket parts revenue made up 66% of total revenue and helped boost adjusted EBITDA to a record $26 million in the fourth quarter. We believe the fundamental drivers of end markets remain healthy, though business activity continues to be influenced by geopolitical and macroeconomic challenges around the globe. Turning now to our Industrial Processing segment. Our performance in the fourth quarter was solid despite the softening in some of our core end markets. Organic revenue performance was slightly higher than last year's record Q4 revenue performance. Adjusted EBITDA margin declined 130 basis points compared to the prior year, but remained strong at 24.9% of revenue. This decline was largely attributed to market mix and the timing of shipments in our wood processing product line. Looking ahead to 2023, we expect demand in this segment to soften compared to the record demand we experienced over the last couple of years, particularly in our wood processing product line. In our Material Handling segment, demand was solid across all product lines and project activity was relatively strong. Revenue increased 12% to $51 million, and parts revenue in the 4th quarter made up 53% of total revenue. Capital shipments were strong in the quarter and benefited from record demand in the first half of the year. Organic bookings in our Material Handling segment increased 5% due largely to strong demand for our bulk material handling equipment in all markets. Looking ahead to 2023, we believe this segment will continue to see good business activity, particularly as new Infrastructure projects are executed following the passage of the Infrastructure bill in the U.S. Inquiries from our construction aggregate producers for our bulk material handling equipment are increasing as infrastructure projects begin to gain traction. As we look ahead to the first quarter of 2023 and the full year, ongoing project activity is healthy and demand has been solid as we entered the year. Economic headwinds are building, which makes the second half of the year less certain. Our backlog and strong balance sheet have us well positioned to capitalize on opportunities that may emerge as the year unfolds, and we expect to deliver solid financial performance for the year. With that, I'd like to pass the call over to Mike now for his review of our financial performance and outlook for 2023. Mike? Thank you, Jeff. I'll start with some key financial metrics from our fourth quarter, which includes some notable records. Gross margin increased 70 basis points to 43.1% in the fourth quarter of 2022, compared to 42.4% in the fourth quarter of 2021. Our gross margin in the fourth quarter of 2021 was negatively affected by the amortization of acquired profit and inventory, which lowered gross margin by 90 basis points. Excluding this impact in the prior year's quarter, gross margin was down 20 basis points due to a higher mix of capital revenue. Our overall percentage of parts and consumables revenue decreased to 60% of total revenue in the fourth quarter of 2022, compared to 63% in the fourth quarter of 2021, due to significantly higher capital revenue at our Flow Control segment. As a percentage of revenue, SG&A expenses decreased to 24.5% in the fourth quarter of 2022, compared to 26.4% in the prior year period. SG&A expense decreased $1 million to $56.8 million in the fourth quarter of 2022, compared to $57.8 million in the fourth quarter of 2021. The fourth quarter of 2022 included a $3.3 million favorable foreign currency translation effect and a $1.5 million decrease in acquisition-related costs compared to the fourth quarter of 2021. Partially offsetting these favorable effects was a $0.7 million of expense from an indemnification asset reversal related to the release of tax reserves. Excluding all these items, SG&A expense increased to $0.1 million due to additional headcount within selling and increased travel costs related to sales and service. Our effective tax rate in the fourth quarter was 29.2%, slightly higher than our forecasted rate of 28% due to the timing of certain incentive compensation payments. Our GAAP diluted EPS increased 8% to $2.23 in the fourth quarter compared to $2.07 in the fourth quarter of 2021, and our adjusted diluted EPS was up 1% to $2.33. Our fourth quarter of 2022 adjusted diluted EPS of $2.33 exceeded the high end of our guidance range by $0.26 due to higher than anticipated revenue, especially at our Flow Control segment, and to a lesser extent, higher gross margins. For the full year of 2022, gross margin was 43.1% compared to 42.9% in 2021. Excluding the amortization of profit and inventory in both periods and government assistance benefits in 2021, gross margin was down 30 basis points to 43%, compared to 43.3% in the prior year due to a higher mix of capital revenue. Our percentage of parts and consumables revenue was 63% in 2022 compared to 65% in 2021. As a percentage of revenue, SG&A expenses decreased to 24.8% in 2022 compared to 26.8%, or excuse me, 26.5% in 2021. SG&A expenses were $224.4 million in 2022, an increase of $15.6 million or 7% compared to $208.8 million in 2021. We had a favorable foreign currency translation effect of $9.8 million and a $3.6 million reduction in acquisition-related costs which lowered SG&A expenses in 2022. This was offset by $11.7 million of SG&A from our acquisitions, a reduction in government assistance benefits of $1.4 million, and a $1.3 million of expense from indemnification asset reversals, which are offset by a corresponding tax benefit within provisions for income taxes. Excluding all these items, SG&A expenses were up $14.5 million or 7% compared to 2021, primarily due to increased compensation expense related to wages and additional headcount, as well as increased travel-related costs. Our GAAP diluted EPS was a record $10.35 in 2022, up 44% compared to $7.21 in 2021. Our adjusted diluted EPS was also a record at $9.24, up 18% compared to $7.83 last year. In the fourth quarter of 2022, adjusted EBITDA increased 10% to a record $49.5 million or 21.3% of revenue, compared to $44.8 million or 20.5% of revenue in the fourth quarter of 2021, led by our Flow Control segment. For the full year, adjusted EBITDA was a record $189.1 million and a record 20.9% of revenue compared to adjusted EBITDA of $159.4 million or 20.3% of revenue in 2021, due to strong performance in our Flow Control and Material Handling segments. Operating cash flow was $35.2 million in the fourth quarter of 2022, up 41% sequentially, but down 42% compared to $61 million in the fourth quarter of 2021. For the full year, operating cash flow was $102.6 million, down 37% from 2021 due to the timing of working capital increases. Operating cash flow was a record in 2021 due in part to a $44.5 million benefit from working capital as customer deposits and accounts payable growth outpaced the growth in inventory and accounts receivable. In 2022, our operating cash flow was impacted by a $50.6 million use of cash for working capital, related in large part to inventory purchases to support our record backlog and an increase in accounts receivable as a result of revenue growth. I would add here that considering our guidance for 2023, we do not anticipate continued growth in working capital requirements. We had several notable non-operating uses of cash in the fourth quarter of 2022. We repaid $15.5 million debt and paid $12 million for capital expenditures, which included $5 million for our facility project in China and paid a $3 million dividend on our common stock. In addition, we paid $3.6 million for the acquisition of a Material Handling business in Canada and a $1.3 million related to the renewal of our credit facility, which I'll discuss in more detail as part of my liquidity review. For the full year, we repaid $63.5 million of our debt and paid $28.2 million for capital expenditures, which included $10.4 million for our facility project in China. Construction for this project is well underway with remaining estimated construction costs of $8 million-$9 million and a projected move date in the middle of 2023. I wanted to mention on the CapEx front in regards to the facility project in China, that as you may recall, the local government had asked us to relocate. They purchased our existing facility, and we received a down payment of 31% in the first quarter of 2022, with the remaining proceeds from the sale of the facility due the earlier when the government sells the property or the first quarter of 2024. Proceeds from selling the facility will pay for the new facility and the relocation costs that will be incurred. Let me turn to our EPS results for the quarter. In the fourth quarter of 2022, GAAP diluted earnings per share was $2.23. Our adjusted diluted EPS was $2.33. The $0.10 difference relates to $0.09 of impairment and restructuring costs and $0.01 of acquisition costs. The $0.09 in impairment and restructuring costs has two components. The first component relates to additional restructuring costs associated with the consolidation of our ceramic blade manufacturing in Europe into our recently acquired Clouth business. The second component relates to an asset impairment charge and other costs associated with exiting our business in Russia. We have a small subsidiary in Russia with a few employees, which was part of our NII acquisition in 2017. Local business transactions by foreign-owned companies have been severely restricted due to Russian sanctions, and as a result, we've been winding down this small operation. In the fourth quarter of 2021, GAAP diluted earnings per share was $2.07, and adjusted diluted EPS was $2.31. $0.24 difference relates to $0.23 of acquisition-related costs, $0.08 of impairment and restructuring costs, a $0.04 discrete tax benefit, and a $0.03 gain on the sale of the building. The increase of $0.02 in adjusted diluted EPS in the fourth quarter of 2022 compared to the fourth quarter of 2021 consists of the following: $0.40 due to higher revenue, partially offset by $0.29 due to a higher recurring tax rate, $0.05 due to higher interest expense, and $0.04 due to lower gross margins. The $0.29 impact from the increase in our recurring tax rate was primarily due to a lower tax rate in the fourth quarter of 2021 due to tax benefits related to a reversal of tax reserves associated with uncertain tax positions and the exercise of previously awarded employee stock options. Collectively, included in all the categories I just mentioned, was an unfavorable foreign currency translation effect of $0.16 in the fourth quarter of 2022 compared to the fourth quarter of last year due to the strengthening of the U.S. dollar. Turning to our EPS results for the full year on slide 17. We reported GAAP diluted earnings per share of $10.35 in 2022, and our adjusted diluted EPS was $9.24. The $1.11 difference relates to a $1.30 gain on sale related to one of our Chinese facilities, impairment and restructuring costs of $0.11, and acquisition-related costs of $0.07. We reported GAAP diluted earnings per share of $7.21 in 2021, and our adjusted diluted EPS was $7.83. The $0.62 difference relates to acquisition-related costs of $0.60, impairment and restructuring costs of $0.08, a discrete tax benefit of $0.04, and a gain on sale of $0.03. The increase of $1.41 in adjusted diluted EPS from 2021 to 2022 consists of the following: $2.19 from higher revenue and $0.36 from the operating results of our acquisitions. These increases were partially offset by $0.39 from higher operating expenses, $0.33 from a higher recurring tax rate, $0.22 from lower gross margins, $0.16 from reduction in benefits from government assistance programs, $0.03 due to higher weighted average shares outstanding, and $0.01 from higher interest expense. Collectively, included in all the categories I just mentioned, was unfavorable foreign currency translation effect of $0.46 in 2022 compared to 2021. Let's turn to our liquidity metrics on slide 18. Our cash conversion days measure, calculated by taking days in receivable plus days in inventory and subtracting days in accounts payable, was 126 at the end of the fourth quarter of 2022, down from 130 at the end of the third quarter of 2022, but up from 106 days at the end of 2021. The increase in conversion days from the prior year was principally driven by a higher number of days in inventory as we have purchased material to support our record backlog. Working capital as a percentage of revenue increased to 13.9% in the fourth quarter of 2022, compared to 12.8% in the third quarter of 2022 and 9.4% in the fourth quarter of 2021. Net debt, that is debt less cash, at the end of 2022 was $121.4 million, a decrease of $54 million compared to $175.4 million at the end of 2021. Our interest expense increased 34% to $6.5 million in 2022 compared to $4.8 million in 2021 due to the increase in borrowing rates in the second half of 2022. Our leverage ratio, calculated as defined in our credit agreement, decreased to 0.74 at the end of 2022 from 1.34 at the end of 2021. We renewed our $400 million credit facility in November for another five year term and increased our incremental uncommitted borrowing facility from $150 million- $200 million. Our low leverage ratio and increased borrowing capacity has us well positioned to act on future investment opportunities. I'll review our guidance for 2023. Our revenue guidance for the first quarter of 2023 is $217 million-$223 million, and our adjusted diluted EPS guidance for the first quarter is $2.08-$2.20. For the full year, our revenue guidance is $900 million-$925 million, and our adjusted diluted EPS guidance is $8.80- $9.05, and excludes $0.08 in estimated moving costs associated with the relocation of the facility in China, which should occur in the middle of 2023. I should caution here that there could be some variability in our quarterly results due to several factors, including the variability of order flow and the timing of capital shipments. In addition, other risks that could impact our guidance include central banks' policy responses to inflation, geopolitical intentions, strengthening of the U.S. Dollar, and lingering supply chain issues. The 2023 guidance includes an unfavorable foreign currency translation impact of approximately $67 million on revenue and $0.11 on adjusted diluted EPS due to the strength of the U.S. dollar. We anticipate gross margins for 2023 will be approximately 42%-43%. As a percentage of revenue, we anticipate SG&A will be approximately 24%-25%, and R&D expense will be approximately 1.5% of revenue in 2023. We anticipate net interest expense of approximately $9 million, and we expect our recurring tax rate will be approximately 27%-28% in 2023. We expect depreciation and amortization will be approximately $34 million-$35 million in 2023, and we anticipate CapEx spending in 2023 will be approximately $32 million-$34 million, which includes $8 million-$9 million related to our facility project in China. Excluding the facility project, we are a little bit above our normal CapEx as a percentage of revenue metric due to a facility expansion project of approximately $5 million related to our wood processing product line. That concludes my review of financials, and I now turn the call back over to the operator for our Q&A session. Operator? Thank you. As a reminder, to ask a question, you'll need to press star one one on your telephone. To withdraw your question, please press star one one again. Please wait for your name to be announced. Please stand by while we compile the Q&A roster. One moment for our first question. Our first question comes from Kurt Yinger with D.A. Davidson. Your line is now open. Great. Thank you, and good morning, Mike and Jeff. Morning, Kurt. Hi, Kurt. I just wanted to start out on aftermarket demand, which looks like it continued to perform pretty well in Q4. If I look at North America, you have the containerboard guys taking some pretty significant market-related downtime with demand challenge. On the wood product side, it's kind of a similar story, including a growing list of curtailments. we'd just love to hear your thoughts as to why that hasn't seemed to have much impact on the aftermarket business, you know, recognizing you service a lot more customers than those I just mentioned. Yeah, I mean, you're right, Kurt, that there has been some softening and there's been some, you know, lower utilization rates. As you're also aware, the last couple of years, many of those customers were running full out, you know, not taking, you know, normal scheduled downtime or outages. They ran the equipment pretty hard, and they wore a lot of it out. I think what we're seeing a little bit right now is they made a lot of money during those periods of time. They ran the equipment hard and cut back on some of the typical maintenance, now they're taking the opportunity with a little bit of a slowdown to, you know, repair and maintain their equipment, get ready for the next big increase that will likely come as the interest rates top out and start to drop off again. I think we're just seeing a little bit of, you know, neglected repair and maintenance during the very busy times, and they're trying to catch up now. Right. Okay. That makes sense and kind of ties into my next question. I mean, you look at CapEx budgets, at least here in North America, and they're still at relatively high levels, which I suspect gives you some confidence. Do you think that's a testament to the windfall that some of your customers have seen the past few years and their financial strength? Do you get the sense that your customers expect this downturn in demand to be pretty short-lived, and if that doesn't come to fruition, they may look to reassess? You know, as I, as I mentioned a minute ago, you know, they ran the equipment pretty hard. They made a lot of money. I do think that they, you know, most people expect this recession to be, you know, short and maybe not as severe as certainly the crisis that we've had in the past, you know. The underlying fundamentals, you know, of their business and of our business are strong. If you look out, you know, the next many years, you know, the fundamentals are, and the forecast are for, you know, good activity levels. I think they're getting prepared for that. You know, you're right, if the recession is longer or deeper, then there could be some further slowdown. As you know, these projects tend to be large and they take a while, and so they're not quick to shut these things down once they get started. I think they're, if you look at most of the companies that are indicating their outlook over the next, say, five years, you know, it's pretty positive. Right. Okay. Then just lastly from me, you touched on 80/20 and some of the success you were having there. I was hoping you could just give a few examples of maybe where that's been particularly successful in different divisions and beyond 80/20, are there any other kind of notable margin initiatives, you're looking at here in 2023? Well, I'd say, Kurt, you know, right now, we have about. If you look at it on a revenue basis, about half our revenue is, you know, in the program. Some of course are in the earlier stages and some in the have had it in place for a few years and we've seen very good benefits. I'd say, in particular, when I look across the segments, you know, one of the one of the first operations was in Flow Control, and we've had a few more in Flow Control that have also joined in. We've seen some very good progress on the in Flow Control. Also we're starting to see some nice traction in Industrial Processing. Got it. Okay. As far as the other programs, you know, we always have kind of ongoing continuous improvement. You know, lean is a big focus of ours that you're never kind of finished there. We always have other programs going on, trying to optimize, you know, you know, our operations. 80/20 has certainly been the, you know, probably the biggest investment and probably we've seen the most, you know, encouraging results from that over the last few years. Got it. Thanks for all the details. Thank you. As a reminder, to ask a question, you'll need to press star one one. At this time, I'd like to turn the conference back over to Mr. Powell for any closing remarks. Thank you, Norma. Before we wrap up the call today, I just wanted to leave you with a few takeaways. 2022 was a record-setting year for Kadant, and our employees deserve a lot of credit for achieving these excellent results. I really wanna thank our employees around the world for their dedicated efforts to serve our customers' needs. In 2023, we will continue to seek new opportunities to create value as we focus on meeting our customers' needs with innovative technologies and solutions that drive sustainable Industrial Processing. Our financial health is excellent, and our ability to generate strong free cash flow remains a cornerstone of our business model. We expect to deliver exceptional value for all our stakeholders again in 2023. We wanna thank you for joining the call today, and stay safe. This concludes today's conference call. Thank you for your participation. You may now disconnect. Everyone, have a wonderful day.