Good morning, ladies and gentlemen, and welcome to the Douglas Dynamics Second Quarter 2022 earnings conference call. All participants will be in a listen-only mode. Should you need assistance, please signal conference specialist by pressing the star key followed by zero. Later, we will conduct a question-and-answer session and instructions will be given at that time. Please note this event is being recorded. I would now like to turn the conference over to Ms. Sarah Lauber, Chief Financial Officer of Douglas Dynamics. Please go ahead, ma'am. Thank you. Welcome everyone, and thank you for joining us on today's call. Before we begin, I'd like to remind you that some of the comments that will be made during this conference call, including answers to your questions, will constitute forward-looking statements. These forward-looking statements are subject to risks that could cause actual results to be materially different. Those risks include, among others, matters that we have described in yesterday's press release and in our filings with the SEC. Joining me on the call today is Robert McCormick, our President and Chief Executive Officer. In a moment, Bob will provide an overview of our performance. Then I will review our financial results and guidance. After that, we'll open the call for your questions. With that, I'll hand the call over to Bob. Thanks, Sarah. Good morning, everyone. As we noted in the press release, we are pleased with our results for the second quarter. We see continued strength and overall demand across our businesses. Our team is using its considerable ingenuity to address and work around the various industry-wide challenges we continue to face. The attachment segment reported strong results with record net sales and strong preseason orders. The solutions segment continues to see strong demand but is still facing macroeconomic headwinds from chassis supply and inflationary pressures. The strong demand outlook in both segments means we are well positioned for long-term success. The headwinds we outlined last quarter remain our biggest challenges today. First, we continue to see inflationary pressures, which are negatively impacting margins. Second, labor market constraints, where our teams have found creative ways to attract and retain talent and the situation is stable to slightly improve. Lastly, supply chain disruption and chassis availability. I'll speak more to chassis in just a minute. We continue to improve how we operate most effectively under these conditions. While the macroeconomic constraints are not easing significantly, the situation is more stable and changing less rapidly today than it was last year. Despite these limitations, we remain on track to deliver our full year guidance, which we have narrowed towards the center of our original ranges. Now let's walk through each segment. Beginning with Work Truck Attachments, where we had another strong quarter. We produced record net sales of $130.4 million, more than 25% higher than second quarter of last year. + $33.6 million of Adjusted EBITDA, also above last year's number. A great start to preseason orders, and we do expect to see the typical 55/45 ratio between second and third quarters this year. We do believe there is some preseason order pull ahead from Q4 as dealers want to build inventory in advance of the snow season. Having said that, both dealer inventories and dealer sentiment remain positive. Overall, Attachments continues to lead the industry and manage through the supply challenges effectively. Turning to our Work Truck Solutions segment, where we delivered $57.2 million of net sales and $500 thousand of Adjusted EBITDA for the quarter. Let's talk a bit more about what we're seeing from a chassis perspective. In the Class 7-8 chassis for our municipal business, supply is now more predictable and consistent. While this is a positive sign, lead times are still long. From a Class 3 through 6 perspective, which is our bread and butter chassis for Dejana, we aren't yet seeing notable across-the-board improvements in supply today. Where we are seeing some improvements is in the supply of work vans for final mile, which is a small but growing portion of our business. This is a positive sign that chassis are starting to free up and gives us confidence that the overall supply of chassis will start to improve in the near future. The main takeaway on the chassis discussion, ladies and gentlemen, is that while we are starting to see signs of improvement, the positive impact will not show itself until later in the year and into 2023. We maintain excellent backlogs at our solutions segment and are well positioned for long-term success. In summary, we are pleased with our performance overall, especially under the circumstances, and remain confident about the rest of 2022, which is why we've narrowed guidance toward the middle of our original ranges. The demand trends remain very positive, and we are managing through industry-wide headwinds as well as can be expected. New product introductions for both attachments and solutions are gaining traction, and we expect will have a positive impact on revenue and earnings in 2023. In the longer term, we are confident in our ability to expand our value proposition, enhancing our industry leading position while providing the highest level of value to our customers. Our laser focus on continuous improvement at all of our divisions will put us in a position to drive towards our long-term financial targets in 2023 and beyond. With that, I'd like to pass the call back to Sarah to discuss our financial results in more detail. Sarah? Thanks, Bob. We're pleased with our results for the quarter as we produced strong year-over-year top-line growth and demand signals remain strong in both segments today. We also continued to navigate the ongoing impact of supply chain constraints and inflationary pressures and delivered earnings that met our expectations for the quarter. From a consolidated perspective, we generated record second quarter net sales of $187.6 million and gross profit of $51.2 million, compared to net sales of $157.5 million and gross profit of $48.8 million during the second quarter of last year. Sales and gross profit both increased year-over-year as a result of strong pre-season orders at Work Truck Attachments and our implemented pricing increases over the past 12 months. SG&A expenses, including amortization expense, were $25.7 million, compared to $24.7 million during the second quarter of 2021. The increase is primarily due to inflationary pressures on salaries and benefits and increased discretionary spending as business conditions returned more towards normal. For the second quarter, we generated consolidated Adjusted EBITDA of $34.1 million, relatively flat compared to $33.5 million in the corresponding period of the prior year. Our performance benefited year-over-year as a result of ongoing strong demand in a more predictable operating environment. While inflation continues to be an issue, the rate of cost increases has slowed. Interest expense was $2.5 million for the quarter, lower than the $4.4 million incurred in the same period last year. The $1.9 million decrease was primarily due to lower interest paid on the term loan due to the decrease in principal balance from the June 2021 refinancing. Offsetting the favorable interest expense was the effective tax rate of 23.2%, compared to 5.5% in the prior year. The rate was higher in the current quarter due to a discrete tax benefit of $2.7 million stemming from a successful outcome in a state income tax audit during the second quarter 2021. We recorded GAAP net income of $17.7 million or $0.75 per diluted share, higher than the GAAP net income of $14.1 million or $0.60 per diluted share in 2021. On an adjusted basis, we generated net income of $20.1 million or $0.85 per diluted share, compared to adjusted net income of $21.3 million or $0.91 per diluted share in the prior year. Now let's turn to the earnings information for the two segments. For the second quarter, our Work Truck Attachments segment generated record net sales of $130.4 million, significantly higher than the $104.6 million last year, and Adjusted EBITDA of $33.6 million, a slight increase when compared to Adjusted EBITDA of $32.2 million recorded in the prior year. The sales increase is driven by the significant pricing actions taken over the last year to offset inflation on input costs. Sales and Adjusted EBITDA also benefited from an increase in pre-season shipments, demonstrating the ability of the attachments team to deliver despite supply chain challenges. The timing of pre-season shipments in 2022 continues to shift back towards traditional pre-pandemic levels. We now anticipate an approximate 55/45 ratio between second and third quarter pre-season shipments. While difficult to quantify, we are considering that some of the strength in orders so far in pre-season could partly relate to dealers pulling forward orders from the fourth quarter based on concerns about being able to get products and parts reordered at our usual market leading speed during the snow season. This pull forward of orders could impact our fourth quarter attachments revenue, and we continue to monitor the situation. That brings us to Work Truck Solutions, where we reported net sales of $57.2 million and Adjusted EBITDA of $513 thousand, compared to net sales of $52.9 million and Adjusted EBITDA of $1.3 million in the same period last year. The increase in net sales compared to the prior year is primarily due to pricing increases implemented. As we had anticipated, inflationary pressures continue to negatively impact Adjusted EBITDA with increased material, labor, and freight costs. Demand, ordering trends, and backlog remain strong. We hope to see chassis supply start to show itself in the coming quarters. Turning to the balance sheet and liquidity figures. Net cash used by operating activities during the first six months of 2022 was $58.2 million, compared to $13.1 million cash provided for the same period last year. Free cash flow for the first six months of 2022 was -$63.8 million compared to $8.6 million during the same period in 2021. These cash flow declines were a result of increased accounts receivable due to the increase in sales, as well as higher material costs and the pull forward of supply, leading to elevated inventories to protect against potential supply chain issues. Both sales and inventory are also largely impacted by the inflated cost and higher pricing due to inflation. Inventory increased to $131.5 million compared to $93.9 million at the end of the second quarter of 2021. Accounts receivable were $127.9 million compared to $92.1 million at the end of the second quarter 2021, which is in line with the increased sales year-over-year. At the end of the quarter, we had a net debt leverage ratio of 3.2x higher than the 2.1x at the same point last year. We maintained total liquidity of approximately $47.1 million at the end of the second quarter, comprising $6 million in cash and cash equivalents and borrowing availability of $41.1 million under our revolver. This compares to $114.3 million at the end of the second quarter of 2021. Moving on to capital allocation. Capital expenditures for the first half of the year totaled $5.6 million compared to $4.6 million in the first half of 2021, which is in line with our expectations. We continue to invest in the business to fund our long-term growth initiatives. As our vertical integration strategy continues, we are lining up projects that, when combined, will help drive long-term organic growth. In our recent investor event, we outlined our plans for growth beyond our historical markets and utilizing the tremendous innovation talent of our team and attachments to develop new products. Of course, our commitment to our dividend remains as strong as ever, and we paid a $0.29 per share dividend as planned following the increase earlier this year. We continued to execute our share buyback program, which we initiated earlier this year, purchasing 89,000 shares at a cost of approximately $3 million. Finally, we continue to actively monitor the competitive landscape for potential M&A opportunities. Before opening the call for questions, as you probably saw in our release, we are narrowing our quantitative guidance ranges as we often do at this point in the year. Based on the ongoing positive demand dynamics we are seeing, plus the stable to slightly improving outlook for chassis and component supply, we feel comfortable narrowing towards the center of the ranges as follows: Net sales are expected to be between $590 million and $630 million. Adjusted EBITDA is predicted to range from $75 million-$95 million. Adjusted earnings per share are expected to be in the range of $1.40 per share-$2.00 per share. Our effective tax rate is expected to be approximately 25%-26% for the year. As always, our outlook assumes economic and pandemic conditions remain relatively stable and that we experience average snowfall levels in our core markets in the fourth quarter of this year. Our results and attachments remain strong heading into the third quarter, and we believe our solutions segment is in a stable position, and we expect to start to see improvement as we exit the year. We are confident that the changes implemented over the past two years will start to pay dividends and improved earnings power as the macroeconomic headwinds subside. With that, we'd like to open up the call for questions. Operator? We will now begin the question-and-answer session. To ask a question, you may press star then One on your touch-tone phone. If you're using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then Two. At this time, we'll pause momentarily to assemble our roster. The first question will come from Mike Shlisky with D.A. Davidson. Please go ahead. Thank you. Bob, can I maybe ask first, how would you characterize this year's early order season in the attachment business? Would you say maybe, you know, in your tenure at the company it's a top three of all time, top five, best ever? What's your thoughts as to kind of where this year stands in the grand scheme of things? Sure. First off, you know, coming off of another slightly below average snowfall year, we had fairly modest expectations going into the preseason. As I noted, the preseason orders were stronger than we anticipated. I don't know that I would call it a top ten because we've obviously had some snowfall-driven record order periods over the course of years. What I would suggest, though, is part of the reason for the strength or these orders being stronger than we anticipated is when we talked to our dealers. This is just how everybody's responding in these supply challenged times. Everybody is ramping up order books a little bit just because they're nervous about people's ability to meet demand. Now you know that we do that better than most, and they know that what we promise we will deliver. In our dialogue with a fair amount of our top dealers, they're probably moving a little bit of Q4 orders into this preseason order book just to make sure that they're ready for the retail selling season. Great. Thank you for that. Switching to solutions, can you just maybe characterize for us how far out you think the backlog stretches at this point? If you hazard a guess, I'd appreciate to know just, you know, how far out you're actually booked at this point. Yeah. You know, we've said over the last number of quarters that we have record backlog in our solutions segment. I don't know that we've given any quantitative data there, but it certainly is between one and two years worth of revenue, which is robust. I will tell you that we haven't seen order pace or people's interest slowing at this point. You know, there's obviously talk about an economic slowdown, but we've got a fair amount of our end user base is still sitting on some pretty good budgets. They still have money to spend. Even as we look out into 2023, even past 2023, the vast majority of those end user customers are anxious to get their hands on that product. Still very robust demand. While I'm sure we'll see some order cancellations down the road, we're not expecting that to be of a material nature at all. It is really, Mike, what gives us confidence in our Work Truck Solutions getting back to the levels of profit that Sarah wants from them, simply because, as you know, it's a high fixed cost. It's a high fixed cost business model. You have to move velocity through those upfit centers to drive the incremental profit through. When we start to see chassis free up, we think pretty good things are gonna happen. Got it. I wanted to also follow up on your comment about some of the final mile chassis supply getting a bit better here or at least some positive direction there. I know it's a small part of the business today, but can you give us some thoughts as to how you're addressing that market? It appears to be had some double-digit tailwind even through a recession. I'm wondering if you're making any extra efforts there to get some deep penetration over the next couple quarters. Yeah. Excellent question, Mike. Yes. One of the areas of focus for us over the past 12-18 months has been to reposition our final mile product offering. We introduced a brand new set of van shelving design in the fourth quarter of last year, and that's now hitting the market and is being very well received. We've got some other product launches slated for the fourth quarter of this year that are under wraps from a confidentiality perspective, but will also flow nicely into that final mile product offering. We think when Sarah quotes some of the solution long-term growth rates, us participating in a greater degree in the final mile growth part of the industry is certainly a component of that. Great. If I could squeeze one last one in here quickly. Sarah, can you review just your interest costs and cash needs for interest going forward? What percentage is fixed at this point? Do you think changes in interest costs will have any bearing on earnings or cash flow over the next couple of quarters or 12 months or so? Yeah, absolutely, Mike. We are seeing improved interest year- over- year, as you know from the refinancing, but we are into our revolver more this year than we had been historically, in large part due to the inflationary costs in our inventory and the pricing that we have in AR. When I think about the interest rate, about 80%-85% of our debt is fixed rate. Our revolver is not. I think a good proxy to use for interest would be taking our second quarter interest and assuming that relatively flat Q3 and Q4. It is a key focus area for us as we exit the year and get our inventory levels back down. Okay. Makes sense. I'll pass it along. Thanks so much, guys. The next question will come from Timothy Wojs with Baird. Please go ahead. Hey, everybody. Good morning. Good morning. Maybe just to start on price cost. Could you just review a little bit how that impacted the second quarter and then just maybe the magnitude of maybe how that improves in the back half of the year and into 2023? Yeah, absolutely. I'll jump in here, Tim. When we think about the price cost relationship, first I'll say, you know, inflation as you've seen, among all companies, it's still ongoing. I would say that the increases have somewhat slowed. We expect a lot of moving variables, between now and the end of the year. We've seen some things come down, but then, you know, we are still seeing some higher costs, natural gas, fuel, et cetera, still coming through at higher rates. From my perspective, the price cost relationship for Douglas is playing out as we had expected. It is different by business. I would say through the second quarter in total, Douglas has covered inflation dollar for dollar. As you know, solutions is the one area where we have been impacted more so because of some of our long-term contracts, and I expect that to continue through the end of the year. I've talked about low single digit EBITDA for solutions. A large part of that is price cost, and then the other piece of that is getting volume through. That will continue through the end of the year. Okay, good. Then I guess on the solutions business, I mean, you have taken out costs and improved some of the throughput and efficiencies and things that we just, I guess, can't see yet. When you start seeing more material volume growth in that business, how should we think about the incrementals? Yeah, fair question. I think in large part, when you think about the improvements that we expect for solutions, getting back to the 19% levels, very much dependent on the chassis supply and when we start getting back to pre-pandemic levels. I think from a cost reduction standpoint, as you know, we've had a lot of really positive projects that are really just highly dependent on the volume going through, and that will be a key part of getting back to the low-teens EBITDA levels. Okay. I guess just on the labor side of the equation, I guess particularly in solutions, how are you positioned if demand or if chassis supply would actually surprise to the upside? Yeah. Excellent point. You know, in the upfit solutions business, a lot of that shop floor labor is highly skilled labor because you're building custom vehicles, and everything can be different than the one that you just finished building. It's almost to a degree that labor pool is a little bit more fixed than it is variable because you can't afford to lose those folks. That's when you're in the downturn part of the cycle, you're carrying a little higher cost there, Tim. The flip side of that coin is when we start to see chassis flow again, we've already got a pretty stable group of folks there that can handle the initial load. Now, we're certainly gonna have to ramp up there because we have made some cuts over the past couple of years. The initial surge or the slow improvement ought to be very manageable for us there. As I said earlier, we're sitting on quite a backlog, and our hunch is that chassis improvements aren't gonna turn on a dime and go from zero to 60 overnight. It will be a steady improvement flow, so we should be able to manage that effectively through the labor pool on that side of our business. Okay, good. Just the last one. I mean, I know there's a lot of moving parts, but how would you think free cash flow for 2022 kinda ends up? Yeah, when I think about free cash flow, I was just talking to Mike about inventory. That's probably the largest variable that may differ from last year. Our working capital now I expect could be $5 million-$10 million higher than where we landed last year. Everything else is, you know, relatively stable. Cash, interest, similar to last year, or $10 million-$11 million. I'll just put that out there. Our tax rate, 25%-26%, and our CapEx at 3% of sales as we've been at. You know, that basically gets you into the lower 40s, which is slightly lower than last year, but very dependent on how our working capital plays out for the last six months. On that $5 million-$10 million of working capital, is that all inflation? Yeah. I mean, when you think about the percentage of inflation we've seen, I'd say yes. Okay. Okay, good. All right. That's what I've got. Thanks for the time, and good luck on the rest of the year. Thanks, Tim. Again, if you have a question, please press star then one. This concludes our question and answer session. I would like to turn the conference back over to Robert McCormick for any closing remarks. Please go ahead, sir. Thanks. As always, thanks for your interest in Douglas Dynamics. We look forward to seeing many of you at upcoming conferences this fall. Have a terrific day and stay safe. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.