Okay, I think we're ready to get started. Good afternoon, everyone, and thank you for joining us today at the Sidoti Small Cap Conference. My name is Kyle May. I'm one of the analysts at Sidoti and Company. The next presentation will be a fireside chat with Minerals Technologies, the ticker is MTX. We're pleased to have Doug Dietrich, Chairman and CEO, with us today. Also, Erik, CFO, and Lydia, VP of Investor Relations, will be joining us for the conversation. Before we get started, if anyone in the audience would like to ask a question, please type it into the Q&A section at the bottom of your screen. We'll try to get to as many of those as we can. But maybe for those who are newer to the story or less familiar, Doug, can you maybe talk about maybe the integration or the reasoning behind why Minerals Technologies has four unique business segments and kind of the connection of how those are all intertwined? Sure. Look, we're kind of a technology-based, especially minerals, company. We operate in a variety of different minerals, but two primarily. One of those is bentonite, which is a clay-like mineral substance, and also calcium carbonate. All of the businesses are linked mainly through those two minerals. I guess we're a bit unique in that we're vertically integrated around the world, primarily in bentonite, but here in the United States in those calcium carbonate. So what we do is we take our innovation pipeline and four core technologies that we apply as a company, and we adapt those minerals and apply them in various markets. Those markets have to be some consumer-based markets on one side, which is one segment, Consumer & Specialties, and then also in industrial applications to help customers with their manufacturing process. That's on the Engineered Solutions. Four core technologies, four product lines oriented by kind of similar markets. One side more consumer, one side more industrial is how it all ties together. Great. And what would you say differentiates Minerals Technologies from other specialty chemical companies? Yeah, I think, well, there's a few things. Well, one, I think it's that portfolio. It's the two sides of the company that have kind of one more consumer-focused, providing kind of long-term, stable growth, and I can go into that more detail, the other side, very solid positions in industrial markets. That gives the company a lot of balance in terms of the markets that we serve and provides growth kind of through the cycle growth and profitability. So we used to be a lot more industrial-focused. We built out this consumer side of the business, and that's added this kind of stable growth as we go forward. The second thing I'd say is with our margin profile, which is expanding, given that some of those consumer products are higher margin, we generate a significant amount of cash flow. We're a strong cash flow generator. We always have been in those positions. I think our vertical integration with having reserves around the world and that stable cost base and then applying them in these markets brings that cash flow. We're typically around, on average, around 7% of sales kind of conversion to free cash flow. Being able to line up kind of stable growth through the cycle, stable profitability through the cycle, and then consistent cash flow generation, significant cash flow generation, I think, is unique. I think the third thing is more internal. It's the way we run the company, our operating model. I know a lot of people talk about operational excellence and how it's applied in different companies. I think we're unique in terms of how deeply it's deployed at MTI, how broadly and ingrained it is in everything we do, from problem-solving, continuous improvement attitudes in every employee around the world, the number of problem-solving events and OE events that we do every day, suggestion systems. I would say that we're top-notch in terms of deployment of OE in our culture. And that gives us an ability to be very nimble and flexible, and we can adapt to changing environments. We've applied that to our innovation pipeline, which we've shortened the time to market more than 50%, and we've tripled the amount of sales for new products because we're becoming very efficient with what we do. It also helps us keep kind of our fixed cost profile. We leverage fixed costs really well. We have a single instance shared service group around the world. And so we're able to bolt things on to the company and leverage that shared service base through standard processes and waste reduction activities. And that helps that margin profile over time as well. So I think those are the three things that stand out, Kyle. Great. One of the themes that I've already started to pick up on, and you've talked about a lot today as well as in the past, but the growth of the company, what would you say are the key drivers of your growth? Well, I think it's our positions in the markets. I'll start with the consumer side of the business and the household and personal care. We're positioned in markets that have kind of stable growth characteristics, pet ownership, and natural ingredient additives that are moving, animal health, etc. So these are going to be not only just in the United States, stable GDP-plus growing, but as we also move them into other geographies where those markets are growing and these markets are growing more quickly than the United States and Europe, that adds to that. Give you an example, our pet litter business. We're the largest packaged pet litter company, private label, in the world. And we're able to supply that in Asia, North America, and Europe. And that business has been growing at almost 8%, 7%-8% over the past few years. And we see that continuing, especially as we move geographically. So I think one thing is just we're in these markets that are more stable growing than we were before. On the industrial side, a lot of the technologies that we apply here in the United States and in Europe are not used as widely in other geographies. But as those markets like the foundry market, packaging markets develop, we're bringing the technologies there and penetrating those markets. Give you an example, our bond systems for gray and ductile iron foundries in the United States, everyone uses our bond system. It's 95% penetrated. The markets in China and India, China is four times the size, and India is the second largest foundry market in the world. And they only use 10%-25% of these kind of systems. There's a long runway for us to kind of grow in these geographies just applying the technologies we do everywhere else. It saves money. It saves emissions. It improves productivity and quality. We're getting a lot of pull for that elsewhere. I think it's just these macro drivers, but also market sizes that are pulling us into these geographies. Maybe following up on the last point where you're talking about market penetration, especially in China and India, how do you think about reaching additional customers in those markets, and what kind of strategy are you applying? Same strategy we apply elsewhere. It's really helping them with their problem sets. Things like recyclability, cost savings, emissions reductions, quality, they're the same things that they need everywhere. And so being able to go in and take a look at a packaging application to be able to remove fiber and maintain strength, increase opacity in a product. Technologies, but being applied where we're being pulled into. And so it's a sales process. You have to get in there. You have to prove it just like anybody else. But there's demand for that type of technology and the need, and that's how we're getting pulled into it. Great. Maybe shifting gears a little bit. Last summer at the Investor Day, the company laid out some five-year targets. So wondering if you could maybe just kind of give us an update on how you're progressing towards those targets, any flavor, color around, do you think you're still on track, better or worse, any directionality there? Yeah, I think we're right on track. It's about a year out. We're right on track. We highlighted that at our last call, our last earnings call. I think there's a couple of things I'll point out. We talked about a kind of 5% kind of mid-single digits average growth rate. I think it could be on the high end. We had a couple of years that were up at 8%, and last year was about 3%. And I think we're going to cycle through that. But on average, 5%. You're going to see some years that are lower growth depending on which markets are in cycles. Right now, we're kind of in a commercial construction kind of lull. But you can see that from where the company was with very cyclical end markets, almost entirely up and down and up and down, now we're going to cycle more between the 3% and the 7% as we continue. But that's going to average and be able to provide this kind of stable growth. So I think you'll see some up and downs in terms of sales numbers, but we're right on track with our margin targets. Like I said, that's going to yield that cash flow target. And that growing level of cash flow provides a lot of optionality for the company, either get back to shareholders or, as we see, bolting on some pieces that might fit the company going forward. Perfect. Let's see, margin is something that you've also kind of touched on. Maybe kind of following up there, if I remember correctly, I think the margins in the back half of last year were about 13.6%. Maybe if you could talk about the goal and whether you're on track to meet 14% this year, and then I believe 15% was the goal for 2025. Maybe just the additional steps that you'll be taking or expect to take to get there. Yeah, we're right on track. I think we've got a good line of sight to that interim target of 14% and 15% next year as the goal. The steps were, as we laid out, price-cost were largely caught up. I think there's still pricing opportunities. We've got good pricing power, holding prices as we see some of the costs start to plane over. We've seen that margin expansion also through our new innovations and some of those consumer-oriented products growing. And as they grow faster, their higher margin, they're going to be accretive to the average that you've seen in the past. So the price-cost, kind of higher growth and higher margin products. And then, as I mentioned earlier, we have a business model where we have a global shared service. We have a fixed cost base that we can leverage. We're not going to have to add fixed costs. We've got good capacity in our facilities and not going to have to add fixed costs as that revenue grows. And so we're going to see that leverage at that kind of more stable growth rate. So those three things combined are what's going to continue to grow and drive our margins north. Great. Maybe shifting gears, if we could maybe look at the different aspects of the business and if you could maybe talk about kind of that outlook and the key markets that are affecting your businesses this year? Well, again, I think the one that's affected, too, that affected us last year, we had some destocking that went through North America, paper volumes. We saw some personal care destocking. Though it started out stronger, the commercial construction and residential markets were weaker last year. I think we've started to see some turn in the North American paper market. We've seen some turn or the ending of destocking and turning in the consumer products portion of the business. Residential is more stable than it was last year, though commercial construction, as I mentioned, still seems pretty weak. So I think we're starting off the year with some more positive trends than we ended up in the back half of last. Our consumer business is still growing, like pet litter is doing well. I don't see the commercial construction market moving north. I'm hopeful or thinking that maybe in the back half of the year, but starts in, I think. You got to look at some of the loans and markets and construction loans coming through before we start digging some holes for big buildings that will end up waterproofing. So there's some thoughts that maybe on the back half of the year that will become stronger, but we don't see that right now. Got it. One question that I was thinking about with the paper and packaging business, I believe last year at the Investor Day, it represented about 60% of revenue in the specialty additive segment. You've talked about the new satellites that are coming online in Asia. So I was just wondering if maybe you could give us an update on kind of how these satellites are progressing. And is that going to be a bigger part of the business going forward? And then finally, with those new satellites, are those generating better margin than the older facilities? Yeah, historically, the paper and packaging business was probably 65% of the company 10 years ago. It's now under 30%, but it's still a great contributor. So we've diversified the company into, like I said, into these consumer businesses. That paper business should continue to grow 2%-3%, that Specialty Additives business in total. It's a really great cash flow generator. But what we've seen in terms of driving that growth is a move more from base copy paper, which is what was historically, much more into packaging and consumer packaging, white packaging, which is growing. And what we're really seeing is not only the penetration of our solutions into that packaging, but also the demand for recycling solutions, right? So our Envirofill, and we've had a number of different solutions and Fulfill in general, which are taking waste streams from the packaging mill or the pulping mill and being able to repurpose it through our Crystal engineering capabilities and put it back into the box or into the sheet of paper or into the coating. Because we're taking a waste stream at a low, very low-cost waste stream and putting it back in, the margins are better. We do have it also widens the opportunity set to be able to bring value into the paper and packaging market. A lot of these issues are faced more in Southeast Asia, India, China. There are opportunities, but there are some also in North America and South America as well. We're seeing a lot of pull for these more sustainable, circular kind of technologies. That's what's really driving the growth both into paper and into packaging. We have, I think, Erik, two satellites, one of them in packaging and one of them with that new yield recycling technology being built this year. I think we brought three on last year and two more this year. So it's been a real and two of those have been two packaging and two of the new yield recycling technology. So the drive into those new markets has been pretty strong for us, and I think it's going to continue. Hopefully, that answered your question. No, that was very helpful. And maybe kind of along the same lines, last quarter, the company signed two additional long-term contracts for paper and packaging satellites in Asia. And I'm not sure if you can give us specifics to those contracts, but maybe just from a big picture standpoint, what do those contracts typically look like, whether it's pricing or length and duration or any thoughts you can provide there? Yeah, this is, again, part of, well, the contracts are usually 10 years long, some longer, some 15. They have mechanisms that protect the return on the investment. So a satellite operation, for those that don't know, it's a fit-for-purpose kind of facility that we own on the packaging mill or the paper mill site. So we own the equipment. We lease the land. And we'll enter into that contract. We'll build that facility in exchange for a long-term contract kind of exclusive supply. We have mechanisms to protect the capital in case something happens in the short term. We have pass-through mechanisms that the price will go up with input costs. And we have sometimes curves around volume fluctuations. The price will change. But that entire contract is designed to return a stable pre-tax cash flow on that investment. And so if you think about it, we invest a certain amount of money. We price it at a return on investment, and then that thing continues on for 10+ years. We usually renew that contract for another 10 years. We may make some upgrades to it. Look at it as a really nice annuity stream of cash. It's part of that strong cash flow profile of the company. We'll put these in place. We have 50 of them around the world. They will fit for purpose, and we generate cash and profit off them on a regular basis for kind of a 10-year period. Typical paybacks, we're targeting kind of the 15% IRR. It depends. Different technologies we'll put in place. But that gives you an idea of the type of returns we're looking at on these. Got it. We're starting to get a few questions coming in through the Q&A section. I want to address a few. One of the grand market agnostic, I think, product lines. So I'd say it's not we're geared toward one or the other. I think in the recent past, probably more geared to that consumer as we wanted to build out that pet litter business, as we've been investing in technologies in those personal care product lines and renewable fuel filtration, animal health, building out that consumer part of the business. But we have opportunities in all three of them. I'd say the M&A pipeline, I try to give people a framework for how we think about it. We would explore other minerals, but I think it would be pretty close to one of the markets that we serve. So we'd know the market really well, but it would be a mineral that would be synergistic to something that we're already providing. That would be something we'd look at. Or we'd look at a new market, but it would probably be one of our current minerals. We'd know the mineral well, but it gives us access into or deeper access into a market that we either currently serve. So there's a broad range of things that we could look at and bolt on, technologies and/or businesses that give us more geographic growth or deeper into one of these consumer businesses or environmental businesses. But we have got good opportunities on each of the four product lines. That makes sense. Another question is, can you provide any updates on the subsidiary bankruptcy? Currently, as you know, in October, we took Barrett's Minerals, Inc., into bankruptcy. We're now in a process, and that was around establishing a 524(g) trust for the business, basically selling the assets and contributing them into the trust, the proceeds into the trust. We're currently in a mediation process that's been ongoing. That'll probably take some time to move through that to make sure that we've settled with the creditors and looking at what that trust should look like. So that process is ongoing. And I'd like to move that through as quickly as possible. But again, it is a structured process in the bankruptcy court, and through mediation, it's working its way through. Got it. Maybe another question, kind of pivoting back to the business. Last quarter, in the slide deck, you highlighted a lot of the new technologies that the company's working on. Can you maybe talk about any that you're particularly excited about or anything that's kind of new and upcoming? Yeah, we've got a number in each of them. I think I'm really excited about some of our water technologies. The company's always had the capability of dealing with water and removing contaminants from water. We have a new one that we're applying it to PFAS and some forever chemicals. And I think that that has some real long-term potential for the company. What we do, this is part of our particle surface modification. We take a substrate mineral, and we adapt the surface of it so that it bonds that PFAS molecule to it and won't release it. So it's permanently attached, enabling you to be very effective at removing the chemical from water. So right now, we're currently working through almost 50 different areas, trials, small and large. We've done a number of big projects, pump and treat, where we're pumping out of wells or water bodies, treating the water and reinjecting it. It's proving to be extremely effective and also very cost-effective media versus some other technologies. So I think that one's pretty exciting. I think over time, as regulation and as this develops, it's a big market opportunity. I think we're going to even if we take a small share of it, I think it's going to be a pretty big one for the company. We've got some really interesting things going on in the household and personal care. I think little known, we're one of the largest retinol kind of additive providers in the United States, which go into anti-aging creams, etc. We've always been known for our technology for delayed release. As the movement toward natural additive, natural skincare products, natural feed additives, we're well positioned for that with our minerals. We've developed a new natural delayed release additive for which a lot of companies are moving to, and the demand is high for. We've got some interesting technologies that are coming out and that I think provide some near-term and obviously, with the PFAS, some long-term growth for the company. That's really interesting. Another question that came in, can you talk about the benefits of the resegmentation? Has it met your expectations, or have you had any surprises? Yeah, it's largely met the expectations. I still think there's more to go. We did this to again, the company was largely organized around its legacy, kind of the way we put together with Legacy MTI and AMCOL and the segments that came with it. It was largely organized by mineral as well. And what we realized, we knew for a while, but as we built out this consumer business, these pieces and parts sat everywhere. And so putting them together with the technologies that were primarily used, we saw those synergies happening. We saw the sharing of market knowledge and the sharing of ideas around technologies. I think we've seen the earliest impact in our High-Temperature Technologies. If you think through our refractories and steel and glass, high-temperature and foundry, they use the same thing. It's an engineered blend to help our customers make the product, whether it's steel or gray and ductile iron casting. The collaboration that's happened, the common customer base, we knew this was there, but it really has taken off globally. I think things are speeding up. I think, as you know, we saved some cost from doing it. We took out some overhead from doing it. I think we're only getting started in terms of this type of gelling of what's happening in the conversations and the speed of decision-making. So I think there's more to come, but I'm very happy with where we are and how it's turned out thus far. Great. Maybe from a capital allocation strategy, are there any investments you can make to drive better efficiency? We are, let's see, from a capital allocation and to drive efficiency. Well, we've invested over time quite a bit of capital in some of that efficiency. One of the things that I think is also unique, and I mentioned it earlier about the company, is for a company our size operating in 32 countries, having a single ERP system to run the company is very unique. We've made a lot of investments in doing that. We've put a lot of money into a single instance Oracle system. But we've also built a global shared service. So if you think about what that means, is we have folks around the world that act relatively agnostic to the business that they support from whether it's an accounting or an AR, AP, payroll, you name it, anything transactional that happens in the company that's repeatable and transactional, we put into that shared service. They become very efficient with those transactions. They are held to the same efficiency standards that we put our manufacturing processes under. But it enables us to offer transactions around the world at any time, 24/7. So when we close our books every month, we're closing the books in China, and we're moving all the way around into the United States and Europe. People in these regions are helping us close those books so much so that we can close our books in three days. We have numbers. From the time we say go, 2.5 days, three days later, Erik and I are looking at numbers. And that allows us to be very fast, right? We're able to look at what happened. We're having business meetings on day five. We're making decisions, making corrections, and we're moving on. 10 years ago, that took us seven days, nine days, right? So you're halfway through the month before you even know what's going on. And now we can do that in three, four, five days. And so it's very fast. And so that efficiency, and if we acquire a company, boom, we're putting in that same system. We put in that same set of processes, that same single instance system, and we run the company in a standard fashion around the world. We invest in ourselves for efficiency all the time, all the time, if that's where the question was coming from. Hopefully, I answered it. Yeah, that's impressive. We've only got a few minutes left. So maybe a big picture question on capital allocation. And you can kind of take this any way that you want. But I know you talk a lot about the 50/50 allocation plan. Maybe if you could touch on that for those who are less familiar. And then also, now that your leverage ratio is below your 2x target, is there a scenario or a point where you would modify that 50/50, or how do you think about that? Yeah, I think so the 50/50 only expanded. When we're down around our target leverage of around 2x, we look to steer 50% of our free cash flow back to investors. And I think you just saw that in October. We initiated a $75. We got down to our 2x. I think it was 1.9. And we initiated a $75 million one-year share purchase program. And also, we doubled our dividend, so from five cents to 10 cents, which takes that to about $14 million a year. We generate about $150 million of free cash flows. So that's $85 million this year we see steering back to investors. And that's kind of a rule of thumb. We like to keep some cash on the balance sheet because we do see that there's some bolt-ons out there that we think having cash on hand to be able to execute an acquisition in an area very quickly. That said, as cash grows, but that's not a hard and fast rule. If we were to look at something, a bigger acquisition that we felt would be more valuable to investors, we could pull back on that share purchase and steer the capital to that acquisition. Likewise, if that moves further out, we could take that cash flow. And we've seen in our past when we're down around this leverage that we've actually put out $150 million share repurchase programs in our past. So we're very open to steering it more toward returns to shareholders, but want to be in this balanced capital deployment so that we maintain the capability of bolting on some acquisitions as we see them. I think with our cash flow profile, we're able to do both. We're able to both continue shareholders and maybe increase shareholder returns, but also being able to do acquisitions. I think that's the power of the model that I think we've built. Like I said, growth, margin expansion, and consistent cash flow generation gives us those options to be able to do something like that. Great. Well, Doug and Erik and Lydia, I really want to thank you for the time today. It was a great informational conversation. But I'll leave it with you if there's anything else that maybe we didn't cover, anything else you want to touch on with investors before we wrap up. No, I think you covered a lot of it. Hopefully, I didn't do too much talking, Kyle. But anyway, I don't know, Erik or Lydia, if you think there's anything we missed. I do appreciate you having us today. It's been a great conference, and we look forward to doing again. Thanks for joining us. Thank you, Kyle. Erik, thanks for joining us. Lydia, you as well. We really appreciate you being a part of the conference today. I hope everybody has a great rest of the day. Thank you very much. See you. Bye. Thanks.