Greetings and welcome to MRC Global's Third Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Ms. Monica Broughton, Vice President, Investor Relations and Treasury. Thank you, Ms. Broughton. You may begin. Thank you and good morning. Welcome to the MRC Global Third Quarter 2024 Conference Call and webcast. We appreciate you joining us. On the call today, we have Rob Saltiel, President and CEO, and Kelly Youngblood, Executive Vice President and CFO. There will be a replay of today's call available by webcast on our website, mrcglobal.com, as well as by phone until November 20, 2024. The dial-in information is in yesterday's release. We expect to file our quarterly report on Form 10-Q later today, and it will also be available on our website. Please note that the information reported on this call speaks only as of today, November 6, and therefore you are advised that information may no longer be accurate as of the time of replay. In our call today, we will discuss various non-GAAP measures. You are encouraged to read our earnings release and securities filings to learn more about our use of these non-GAAP measures and to see a reconciliation of these measures to the related GAAP items, all of which can be found on our website. Unless we specifically state otherwise, references in this call to EBITDA refer to adjusted EBITDA. In addition, the comments made by the management of MRC Global during this call may contain forward-looking statements within the meaning of the United States federal securities laws. These forward-looking statements reflect the current views of the management of MRC Global. However, actual results could differ materially from those expressed today. You are encouraged to read the company's SEC filings for a more in-depth review of the risk factors concerning these forward-looking statements, and now I'd like to turn the call over to our CEO, Mr. Rob Saltiel. Thank you, Monica. Good morning and welcome to everyone joining today's call. I will begin with an overview of recent actions we have taken to strengthen our capital structure, followed by a high-level review of our third quarter results. Kelly will provide a detailed review of the quarter and guidance before I deliver a brief recap. First, we are very excited to have finally achieved our long-standing goals to simplify and strengthen our capital structure. As long-term investors will know, MRC Global entered into an arrangement in 2015 to issue convertible preferred shares in exchange for funds that were used to reduce the company's high debt load in an unfavorable business environment. Over the years, this instrument has allowed the company the breathing room to diversify our business portfolio and weather the challenges of the pandemic as we worked to deleverage our balance sheet. On the flip side, many current and prospective investors expressed concerns about the complexity of our capital structure, including the potential for dilution if the preferred shares were ultimately converted into common stock and the concentrated ownership position associated with this holding. Last week, with credit markets open and the outlook for future interest rates favorable, we issued a new seven-year, $350 million Term Loan B that allowed us to repurchase all of our convertible preferred shares at a slight discount. In conjunction with this term loan launch, Moody's Investors Service upgraded our credit rating one notch. Since the after-tax interest costs of the term loan are expected to be lower than the non-tax-deductible cash dividends that we have been paying on the preferred shares, this transaction is expected to be accretive to cash flow and earnings for 2025 and beyond. In addition, we are currently in the market working to extend the maturity date of our asset-based lending facility to 2029, and we expect to have this new credit agreement finalized soon. Along with our new term loan, this extension will de-risk our company's need to access the capital markets over the next few years. Since we have replaced the preferred shares with our term loan in our capital structure, our pro forma leverage ratio is approximately 1.7 times based on the trailing 12-month adjusted EBITDA levels. Kelly will articulate further in his section, but we will be targeting a one to one and a half times leverage ratio under normal business conditions. This implies that we will look to delever our balance sheet a bit further in 2025. Now, I will turn to our third quarter highlights. Consistent with our recent pre-announcement associated with our term loan issuance, third quarter revenue was $797 million, a 4% decline from last quarter and in line with our previous guidance. PTI sector revenue decreased as a result of slowing oil field activity in our U.S. segment, partially offset by increased project activity in our international segment. Our DIET sector experienced a decline due to certain project activity in the U.S. segment that it concluded in the second quarter. Gas utilities revenue improved 3% sequentially, driven by increased customer spending due to seasonal increases and normalizing buying patterns by most of our customers. We generated $96 million in operating cash flow in the third quarter and $197 million through the third quarter, effectively meeting our 2024 full-year target of $200 million a quarter early. The strong cash generation for the quarter was in large part due to very efficient working capital management. We set a new company record low for net working capital to sales this quarter at 14.3%. Given the robust cash generation to date, we are increasing our guidance for 2024 operating cash flow to $220 million or more, and we remain very optimistic on the cash generation potential of our company going forward. Adjusted EBITDA margins came in at 6% for the third quarter, lower than levels seen during the first half of the year. This was a result of lower sales and adjusted gross margins during the quarter due to project delays, softening U.S. oil and gas activity, and the completion of certain higher gross margin project activity that benefited the first half of the year, and finally, our international business continues to have an excellent year. Third quarter revenue grew 21% year over year and 4% sequentially, driven by growth in both the PTI and DIET sectors. The international business is positioned for double-digit revenue improvement for the full year, supported by a backlog that is 22% higher than a year ago. Our growth has been enabled by multiple European projects and MRO activity in the PTI sector and by multiple energy transition projects in the DIET sector. Moving now to our sector discussions. In our gas utility sector, we believe we are seeing stabilization compared to the sharp declines in revenue we experienced in the second half of last year. In fact, this was the third quarter in a row of increased revenue. Most of our customers are returning to more normal purchasing patterns, while a smaller number continue to focus on destocking. Project-related gas utilities work has slowed this year but is expected to recover in 2025. Industry analysts and several of our largest customers have made public announcements regarding increasing their capital spending on natural gas infrastructure maintenance projects in 2025. The annual growth rates in capital expenditures for natural gas utilities that we serve are expected to range from 4% to 6% over the next five years. This remains a healthy underlying growth rate for our gas utilities business. In the DIET sector, several U.S. projects and refinery turnarounds that we are involved in have been delayed into 2025, and U.S. LNG-related activity has been impacted by permitting delays for new projects. This has been offset somewhat by success with our chemical strategy and strong growth this year in our mining business. We have developed new project capabilities, which have allowed us to supply large amounts of material to downstream projects. In addition, our international business continues to do extremely well in the DIET space, especially with refinery work and energy transition projects. Turning now to our PTI business, we continue to see slower U.S. oil field activity due in part to the widespread consolidation of producers, particularly in the Permian Basin, and due to lower oil and natural gas prices. We continue to believe that the industry consolidation efforts by the large oil and gas producers will have a net benefit for MRC Global, as the larger players tend to be more focused on high-quality products with a lower total cost of ownership and more consistent in their production activities. Our international PTI business remains strong, led by our participation in several European projects and our growing presence in the Middle East. Knowing that 2024 will be a down year for revenue versus our previous two years, we have taken recent steps to improve our cost structure without impairing our opportunity to grow in the future. This effort has involved examining all costs and activities for people, goods, and services in order to mitigate the effects of inflation in certain areas of our business, for example, in rents and wages. Our goal is to maintain a similar or lower adjusted SG&A cost in 2025 compared to what we will incur this year. We will provide more details on this in our February earnings call after finalizing our 2025 budget. In summary, we have consistently said that 2024 would be a transitional year, and it has certainly turned out that way. Although it is too early to give specific guidance for next year, we are optimistic that 2025 will show meaningful improvement in our gas utilities and DIET sectors. The biggest risk at this point appears to be around our PTI sector, as concerns about global oil supply and demand imbalances and excess natural gas production could lead to a slowdown in North America oil field production activity. To close on a positive note, our end-market diversification, healthy gross margins, lean cost structure, and working capital efficiencies have positioned us to generate consistent cash flow across the business cycles. Over the next three years, we expect that our business can generate operating cash flow between $100-$150 million a year, assuming normal cyclicality. This cash generation capability, along with our new and improved capital structure, should allow us significant flexibility to consider various capital allocation strategies for the benefit of our shareholders. And finally, we announced yesterday that Debbie Adams has been elected as the new Chair of our Board of Directors, succeeding Bob Wood, who has retired from the Board. Debbie brings extensive experience in the midstream and downstream energy markets through her previous executive positions, and she has served on our Board since 2017. On behalf of the Board, I thank Bob for his many years of service and wish him the best in his retirement. And the entire Board looks forward to working with Debbie as our new Board leader. And with that, I will now hand it over to Kelly. Thanks, Rob, and good morning, everyone. My comments today will be primarily focused on sequential results comparing the third quarter of 2024 to the second quarter of 2024, unless otherwise stated. Total company sales for the third quarter were $797 million, a 4% sequential decrease, and a 10% decrease compared to the same quarter last year. From a sector perspective, gas utility sales were $295 million in the third quarter, an $8 million, or 3% increase. The growth was driven by increased customer spending resulting from a typical third quarter seasonal increase and the normalizing of buying patterns as customers continue to work through their destocking issues. We have been encouraged to see stabilization in new order intake the last several months and have now seen three consecutive quarters of sequential growth in this sector. As we said coming into the year, this has been a transitional period for our gas utility customers due to destocking, inflation, and reduced project activity, but we are expecting increased spending in 2025, which is supported by early capital spending projections from several of our gas utility customers. The DIET sector third quarter revenue was $248 million, a decrease of $20 million, or 7%, as a result of lower project activity in the U.S., partially offset by an increase in the international segment for an offshore wind farm project in Europe and a desalination transmission system in the Middle East, as well as increases in turnaround activity in both Europe and Asia. The PTI sector revenue for the third quarter was $254 million, a decrease of $23 million, or 8%, driven by the U.S. and Canada, partially offset by an increase in the international segment. The U.S. decline is due to the completion of projects in the second quarter, as well as an overall softening the industry is experiencing in oil field activity. On the positive side, we are already seeing meaningful increases in work from a recently announced major North America contract. And over time, the recent E&P consolidation announcements are expected to be positive for MRC Global as customers finalize their integrations and we capture more of the combined spend. The international segment continues to show very strong results with double-digit year-on-year increases, largely due to projects in Europe, Asia, and Australia. From a geographic segment perspective, U.S. revenue was $644 million in the third quarter, a $33 million, or 5%, decrease as the PTI and DIET sectors declined, partially offset by an increase in gas utilities. International revenue was $127 million in the third quarter, up $5 million, or 4%, driven by growth across all of our key geographies. Our international business continues to have an impressive year, and its outlook remains positive with expectations for double-digit year-on-year revenue growth in 2024, and we believe we will continue to have solid growth in this segment in 2025 as well. Canada revenue was $26 million in the third quarter, down $7 million, or 21%, primarily due to declines in the PTI sector. Now turning to margins. Adjusted gross profit for the third quarter was $166 million, or 20.8%. This quarter was slightly shy of our 21% guidance due to an unfavorable product mix, specifically lower margins on certain line pipe sales, including non-repeating project activity last quarter with accretive margins compared to our typical company averages. Reported SG&A for the third quarter was $123 million, or 15.4% of sales, as compared to $126 million, or 15.1% for the second quarter. Comparing third quarter adjusted SG&A to adjusted second quarter SG&A of $124 million, we came in $1 million lower. And as Rob mentioned, we are currently reviewing our SG&A cost and ways to optimize our cost structure as we transition into 2025. Adjusted EBITDA for the third quarter was $48 million, or 6% of sales, a 180 basis point decline from the second quarter due to reduced sales activity and lower gross margins as previously described. Tax expense in the third quarter was $3 million, with an effective tax rate of 9% as compared to $12 million of expense and a 29% effective tax rate in the second quarter. The effective tax rate for the third quarter was favorably impacted by a net reduction in a valuation allowance provision offset by foreign losses with no tax benefit. For the third quarter, we had net income attributable to common shareholders of $23 million, or $0.27 per diluted share. Our adjusted net income attributable to common stockholders on an average cost basis, normalizing for LIFO adjustments and other items, was $19 million, or $0.22 per diluted share. In the third quarter, we generated $96 million in cash from operations due to a very strong quarter of working capital optimization. We set a new record low for working capital efficiency this quarter with a 14.3% net working capital to sales ratio. We generated $197 million in the first nine months of the year, effectively meeting our annual operating cash flow target of $200 million one quarter early. The third quarter benefited from both inventory reductions and strong cash collections during the quarter that put us ahead of the curve related to the timing of these cash flows. And as a result, the fourth quarter operating cash flow will be lower than levels seen in the third quarter, but for the full year, we are now increasing our cash flow expectations to $220 million or more. Turning to liquidity and capital structure, at the end of the third quarter, our total debt balance was $85 million, and our leverage ratio was 0.1 times. Our solid balance sheet position facilitated our ability to successfully execute several capital structure transactions after the end of the third quarter as follows. First, we successfully issued a new seven-year $350 million Term Loan B at a 99.5% OID and with an interest rate of SOFR plus 350 basis points. We also negotiated an interest step-down feature that can automatically reduce the spread from 350 basis points to 325 should we receive a credit rating upgrade. This is a covenant-lite loan with terms substantially the same as the previous loan. We used the proceeds from the loan to repurchase our preferred stock for $361 million. Removing this instrument results in several benefits to the company and our shareholders. Based on terms negotiated and referencing the current SOFR forward curve, it will be accretive to both our earnings and cash flow in 2025 and beyond as it eliminates the non-tax deductible dividend payment and replaces it with a lower after-tax interest expense. It also simplifies our capital structure and removes an overhang of concern related to future financing transactions. Finally, it removes any worries about potential future dilution of the common shares related to conversion of the preferred shares. In addition, in conjunction with the term loan launch, Moody's upgraded our corporate family rating as well as our term loan rating from where it had been earlier this year to a B1 and B2, respectively. They referenced the combination of removing the preferred shares and the new term loan as a positive for the company, noting our ample interest coverage, positive free cash flow, solid operating performance, and robust credit metrics. Finally, as Rob mentioned, we are in the process of extending our asset-based lending facility to 2029, which is on track to be closed by mid-November. And now, with the new capital structure, our pro forma total debt on September 30th would have been $433 million, with a net debt of $371 million for a leverage ratio of 1.7 times. We have a solid balance sheet, and we will continue to manage it prudently going forward and expect to lower the leverage ratio meaningfully in the coming years. In 2025, we believe we can reduce the leverage ratio to between 1.0 and 1.5 times, assuming all free cash generation is used to lower our net debt position. Our current availability on the ABL is $485 million, and including cash, our total liquidity was $547 million on September 30th. Now, I'll cover the outlook for the fourth quarter of 2024. Generally, in the fourth quarter, we see a seasonal sequential decline in revenue of 5%-10%. This year, given the softening in the U.S. portion of the PTI sector and project delays in the U.S. DIET and gas utility sectors, we expect the fourth quarter to decline in the upper single digits. Also, we continue to target the following key metrics for the remainder of 2024. First, operating cash flow generation for the full year of $220 million or more. For adjusted gross margins, we anticipate an average in excess of 21% for the full year, but for the fourth quarter, we expect to be at approximately 21%. SG&A expense is expected to be at a similar level to the third quarter, and capital expenditures are expected to be at approximately $35 million for the full year 2024, which includes our ERP implementation cost. Regarding our ERP project, we remain on budget and on schedule. We continue to make progress, and we are excited about its potential to transform many aspects of our business. We expect to be fully implemented and running on the new system in the second half of 2025. Post-implementation, we expect our annual CapEx run rate to return to a historic run rate of approximately $15 million per year. We now expect our effective tax rate in 2024 to be in the range of 24%-26%. And with that, I'll turn it back over to Rob. Thanks, Kelly. The first half of the year started off with solid performance, and while we saw some softening in the third quarter, we are in a very strong financial position as we approach the end of this year. We have transformed MRC Global into a more efficient company with consistent cash generation and a solid balance sheet that is primed for future success. These are the highlights I want to summarize before opening for Q&A. We increased our 2024 cash flow from operations target to $220 million or more. We expect to consistently generate operating cash through the cycle, which will allow us flexibility to consider shareholder allocation alternatives in 2025. Our balance sheet is solid and simplified. With a new term loan that matures in 2031 and the expectation of an extended ABL facility until 2029, we have improved our earnings and cash flow versus the preferred share instrument, and we have de-risked our dependence on near-term capital markets for our credit support. And finally, while we expect a seasonally weaker fourth quarter, we are optimistic based on early indicators that we will experience meaningful improvement in our gas utilities and DIET sectors in 2025. And with that, we will now take your questions. Operator. Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press Star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your questions from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. The first question comes from the line of Tommy Moll with Stephens Inc. Please go ahead. Good morning, and thank you for taking my questions. Yeah, good morning, Tommy. Rob, I wanted to start on cash flow and capital allocation. You've walked us through the steps to simplify the capital structure. You highlighted the visibility to $150 million of operating cash flow for a few years. And so I wonder if we could just revisit capital allocation priorities here. It sounds like for 2025, debt deleveraging might be the priority. But maybe you could comment on that and then just more broadly on what, if any, changed to priorities here. Thank you. Yeah, thanks, Tommy. Well, first of all, we are really pleased to have fulfilled some long-standing goals and get our balance sheet into a position where it's simplified for our current and prospective investors, but also still reflects a prudent amount of leverage. And as we said in the prepared comments, we're not quite where we want to be on leverage. We're a little bit higher than our target. And again, the target is going to be kind of over the cycle, and there can be points of time when you go outside of the range. But we really would like to see somewhere in a 1-1.5 times leverage ratio going forward. And obviously, we're not quite there yet. So as you stated in your question, a priority for us next year would be to reduce the leverage somewhat. However, one of the things to keep thinking about is that we may have flexibility to do deleveraging and consider capital returns to our shareholders given the amount of cash that we expect to be throwing off. They don't have to be mutually exclusive decisions for us. But I would agree with you that there's certainly a priority on deleveraging a little bit further from where we are. And then the decision about capital allocation as it relates to potential returns to shareholders, that's obviously going to be a board decision, something that we'll be addressing, I think, early next year. And as and when we've got a decision on how that's going to come out, we'll certainly share it with our investor base. But we're excited about having the flexibility that we have now, having retired the preferred shares, having a more normal simplified balance sheet, and flexibility to think about these capital allocation decisions in 2025. Thank you, Rob. As a follow-up, I wanted to touch on the comments made regarding SG&A for 2025. I think what I heard was that the early read is for something similar or maybe even lower in dollar terms. But if you could just confirm or clarify there and then also just give us a sense of what are some of the initiatives that you have in mind to ensure that success. Thank you. Yeah, look, we always talk about the markets and what opportunities the markets provide us, but there's no question that one of the things that we really have control over is our cost structure. There are certain elements of our cost structure that are naturally going to be inflationary, like the leases that we have for our facilities, wages for our people. Those things tend to go one direction, which is up. Given that we've had flat to slightly down revenue really for three years, 2022, 2023, and 2024, we feel like it was prudent for us to take a really hard look at our cost structure. We already have the most competitive cost structure in the industry if you look at our SG&A percentage relative to revenue. However, even with that performance, we believe that there were ways that we could lower our costs and not jeopardize our future growth opportunities. As I said in the prepared comments, Tommy, we've taken a look at everything from headcount, both here and in the field, the purchases of goods and services, and frankly, everything that involves expenditures, travel expenses, customer relations. Everything is really fair game. Where we are today is of a belief that we can really hold or potentially reduce our SG&A next year relative to this year's numbers. It's a little bit too early to be definitive because we haven't worked up our budget yet for 2025. We are encouraged by the fact that we did find some relatively low hanging fruit to get our cost structure more competitive given the slower revenue growth that we've seen. But hopefully, we'll see revenue pick up next year, and that cost structure will allow us to get back to higher EBITDA margins, which is still one of our goals as a management team. Thanks, Rob. I'll turn it back. Yeah, thanks, Tommy. Thank you. Next question comes from the line of Nathan Jones with Stifel. Please go ahead. Yeah, good morning. This is Adam Farley on for Nathan. Hey, good morning, Adam. Good morning. Maybe firstly on gas utilities. I appreciate the commentary earlier in the call. Our channel inventory is normalizing at the same expected pace as your expectations last quarter. And when should we expect inventory destocking to be complete? Yeah, I think we got a question on the last call about this, Adam, and we said it was in the late innings. And now I would say it is in the later innings of the destocking of our customers. If you look at our financials, we've actually seen an improvement in our gas utilities revenue three quarters in a row, which is certainly a positive sign. Obviously, in the fourth quarter, because of the weather and the holidays, you see some drop-off in that because these projects don't go as well, especially in cold weather climates in the winter as they do in the other quarter. So it'll probably come off a little bit this quarter. But as we look toward next year, we are anticipating increased activity from our major gas utilities customers. They're going to return to projects, whether they be maintenance projects or long-standing replacement of old infrastructure that just needed to happen. These projects have been put off in large part because the cost of money has been so high. And in some cases, some money got diverted to electric from gas. But as we look forward to next year, we are very optimistic that we're going to see a pickup in that gas utilities spending. And that's certainly a change for us from what we've seen over the last, call it, year and a half. And we're very excited about that. Okay. And then on your strong cash generation, what are some of the internal initiatives that have helped deliver the strong cash generation profile and improvement in working capital efficiency? Yeah, I'll talk about a couple of things here. Keep in mind that the biggest investment we make as a company is in our inventory. And we are paid to hold inventory at the right place in the right amounts so that our customers can conduct their business and we can serve them with that inventory when they need it. And making that inventory more productive involves a few things. First of all, making sure that we buy the right stuff and that we don't speculate on inventory that doesn't move. I mean, we've stopped that practice. And then making sure that we have the inventory in the right location. So we talked before about a hub and spoke system from our regional distribution centers to our service centers. We've figured out that we can hold more inventory at the hubs and less at the spokes so that it can go more efficiently out to customers either directly or only through a spoke when it's going directly to a customer. And so what this is doing for us is increasing our productivity of the inventory, increasing inventory turns. And increasing inventory turns is basically just increasing capital efficiency because of, again, the large amount of money that we put into our inventory. So that's been a big part of it. And then the other part of it, frankly, is just really good, prudent work on our team in collecting cash that's owed to the company. We work in a lot of different jurisdictions and 16 nations around the world. And there are some companies that we work with and some countries that we operate in where the payment terms are longer or we don't get paid on time. And I think our team has done a really good job of being diligent about making sure that we reduce those Days Sales Outstanding and that we're really focused on collections. So it's really both of those efforts, a combination of much more efficient use of our inventory and making sure that we collect on time that's really allowed us to hit that record low of 14.3% in the last quarter. We're really proud of that, and we need to keep that going. All right. Thank you for taking my questions. You're welcome. Thanks, Adam. Thank you. Ladies and gentlemen, we have reached the end of the question and answer session. I would now like to turn the floor over to Monica Broughton for closing comments. Thank you for joining us today and for your interest in MRC Global. We look forward to having you join us for our fourth quarter call in February. Have a great day. Thank you. This concludes our today's teleconference. You may disconnect your lines at this time.