Good morning and welcome to the Pyxus International, Inc. Fiscal Year 2024 Third Quarter Earnings Call. Please note that this call is being recorded. All lines and links have been placed on a listen-only mode at this time. After the speaker's remarks, there will be a question-answer session. If you would like to ask phone questions, please press star one on your touch-tone telephone. Again, that will be star one for questions. I would now like to turn today's call over to Tomas Grigera, Treasurer. You may begin. Thank you. Leading the call this morning is Pieter Sikkel, our President and Chief Executive Officer, and Flavia Landsberg, our Chief Financial Officer. Before we begin, I'd like to call your attention to our safe harbor disclosure. You may hear statements during the course of this call that express a belief, expectation, or intention, as well as statements that are not historical facts and other statements which may constitute forward-looking statements as defined by the Securities Litigation Reform Act of 1994 as amended. Such statements involve a number of risks and uncertainties that may cause actual events and results to differ materially from these forward-looking statements. The risks and uncertainties associated with forward-looking statements and with our business are described in detail in our filings with the SEC, including our most recent Form 10-Q. We do not undertake to update any forward-looking statements made on this conference call to reflect any changes in management's expectations or any change in assumptions or circumstances on which these statements are based. Also included in our call today are references to certain financial measures that are not calculated in accordance with the generally accepted accounting principles. These non-GAAP financial measurements, including but not limited to measures such as EBITDA, adjusted EBITDA, and adjusted free cash flow, should not be considered as an alternative to U.S. GAAP measures but are provided as additional information that we believe may have analytical value. As required under the SEC's Regulation G, which governs the use of non-GAAP financial measures, we have provided a table in our earnings release and in the appendix to our earnings presentation which reconciles such measures to the most comparable GAAP measures and which may contain other disclosures regarding our use of non-GAAP financial measures. Any replay, rebroadcast, transcription, or other reproduction of this conference call other than the replay as provided by Pyxus International has not been authorized and is strictly prohibited. Investors should be aware that any unauthorized reproduction of this conference call may not be an accurate reflection of its content. Thank you, and it's my pleasure to now turn the call over to Pieter. Good morning to everyone, and thank you for joining our call today. Our third quarter performance was strong, and through the first nine months of the year, we have driven top-line growth, increased profitability, and improved working capital efficiency. As a result, we're excited to increase our full-year guidance for Adjusted EBITDA. During today's call, Flavia will provide details on our financial performance. But first, I would like to share some important highlights. We reported $530 million of sales in the quarter with very healthy margins. While the quarter's total revenues were lower than last year, this was anticipated given our focus on improved mix and improved cycle times, which increased our seasonal weighting in the first half. Year to date, we grew our revenue to $1.63 billion, an increase of just over 8% compared to the same period last year. Our gross margin in the third quarter of 17.5% increased 4 points over last year. Our year-to-date gross margin stands at 15.6%, which represents significant improvement compared to 13% for the same period last year. Our working capital efficiency enabled the company to invest in a significantly larger inventory position while maintaining interest costs comparable to the prior year. Adjusted EBITDA in the third quarter was $64.5 million, a margin of 12.1%. This was a strong performance that brings our nine-month total to just over $165 million of adjusted EBITDA. After having increased our guidance last quarter, we're pleased to raise it again today. Our new full-year target range for adjusted EBITDA is $185 million-$195 million. On a year-on-year basis, net interest expense in the quarter was essentially flat, even as we grew tobacco inventory by $83 million over last year to $780 million with continued low uncommitted levels. We continue to be well-placed to serve strong customer demand in future quarters while maximizing working capital efficiency. We've made consistent, steady progress over several quarters in building a more efficient and more capable position in the market. At the end of the third quarter, we'd increased our working capital deployment by $136 million over last year. And as we ship against our commitments, we're excited to demonstrate continued strong returns for those investments and an influx of cash. In addition to our financial performance, the company is making strides towards achieving our environmental, social, and governance targets. During the reporting period, we released our fiscal year 2023 sustainability report, which highlights, among other things, the achievement of our water-related target seven years ahead of schedule and an 11% reduction in our total greenhouse gas emissions compared to the prior year. We would like to thank our teams from around the globe for their contributions to our continuing success and, at the same time, remembering and embracing their larger responsibility to make progress on critical environmental and social issues. There's no question that, in local communities around the world, how we operate often makes a tremendous difference. Now, I would like to turn the call over to Flavia Landsberg, our Chief Financial Officer. Thank you, Pieter, and good morning, everyone. First, I will start with our year-to-date income statement. We grew year-to-date revenues by 8.2% to $1.63 billion compared to the prior year. This growth was largely the result of our consistent execution, including an effective sales plan and an increase in average pricing of 10%. We improved our gross margin through the first nine months of fiscal year 2024 to 15.6% from 13% compared to fiscal year 2023. This largely reflects an improvement mix of revenues by customer and by geography, as well as some scale-related benefits in regions with improved throughput. Average gross profit per kilo increased $0.17, or 28.3%, for the nine months ending December 31st, 2023, to $0.77 per kilo. SG&A expenses have remained well-controlled despite inflationary pressure and increased accruals associated with performance-related incentive compensation. Through the first nine months of the year, SG&A totaled $116.5 million compared to $106.7 million in the same period of fiscal year 2023. Year-to-date, operating income rose by 72.4% to $130.5 million compared to $54.8 million in the first nine months of fiscal year 2023. In addition to an improved mix of business by customer and by region, this gain is profitability. In addition to an improved mix of business by customer and by region, this gain in profitability also reflects better average conversion costs in some regions due to the scale-related benefits. Net income of $12.7 million for the first nine months of the fiscal year 2024 represents a significant and positive swing compared to a net loss of $18.5 million in the same period of fiscal year 2023. It's worth noting that the net income for both the nine months and the third quarter includes a $12 million non-cash expense related to the elimination of our U.K. defined benefits plan. Our Adjusted EBITDA through the first nine months increased 37.5% to $165.1 million compared to $120.1 million in the prior year, with a strong contribution from the third quarter. Through the nine months, we have already exceeded last year's full-year total for Adjusted EBITDA of $158 million. For the quarter, as expected, sales and other operating revenues in the third quarter were lower than the prior year, with $529.8 million this year as compared to $655.6 million in the same period of the prior year. This was due to a 22.7% decrease in volume compared to an unusually strong year-ago quarter that benefited from delayed shipments. To a lesser extent, the acceleration of shipments into the first half of this year that resulted from our ongoing efforts to reduce cycle times also contributed to the year-over-year difference. We achieved a third-quarter gross margin of 17.5% compared to a 13.4% in the third quarter of fiscal year 2023. This increase was primarily the result of an improved mix of revenues and leverage created over certain fixed costs. These benefits are also reflected by a 29.7% increase in margin per kilo for the third quarter, an improvement of $0.19 to a total of $0.83 per kilo. We grew third-quarter operating income by 14.9% to $47.8 million as compared to $41.6 million in the same period of fiscal year 2023. This improvement reflects the gain in gross profitability as well as lower non-interest expense related to better efficiency in our global working capital financing. Tax expense decreased $11.7 million in the third quarter compared to prior year due to significant shifts in our jurisdictional mix of earnings, deferred tax valuation allowance, and a favorable net foreign exchange effect. Adjusted EBITDA in the third quarter was $64.5 million compared to $61.3 million last year. As Pieter mentioned, our third-quarter net interest expense of $32 million was essentially flat to $31.4 million last year. Our operational discipline, improved working capital efficiency, and geographic diversification supported an increase in our total purchase of tobacco inventory. At the same time, our ongoing focus on shorter cycle across the businesses enabled us to accelerate our repayment of outstanding lines of credit. This, along with continuous improvement on our credit profile, enabled us to lower the spread of our foreign seasonal lines of credit. Our net debt to Adjusted EBITDA ratio dipped below five for the first time in several years, and it was 4.8 x for the 12 months ended December 31st, 2023. Our interest coverage ratio also improved and was 1.6 x at the end of the third quarter compared to 1.4 x last year. Now, returning to our Adjusted EBITDA and our guidance for the remainder of the year, we have the confidence and visibility into the final weeks of the fiscal year to revise our guidance. We expect sales to be in the range of $2 billion-$2.1 billion and Adjusted EBITDA to be in the range of $185 million-$195 million. Thank you, Flavia, and thank you to everyone for your attention this morning. Our strategy for long-term financial improvement is simple. Our objectives have been to, firstly, continue to drive better operating performance, secondly, improve our working capital utilization, and thirdly, reduce our cost of borrowing. We've made excellent progress on each objective, including over the past nine months. Given our operational performance and the degree of working capital efficiency we have achieved, our focus will increasingly turn to driving down our borrowing costs. As we strengthened and realigned our global sourcing network, our diversification efforts extended to developing deeper banking relationships in key countries around the world. When we upsized our ABL a few months ago, we increased our liquidity and have been able to drive borrowing costs down. We expect to leverage the global sourcing work we've done to mitigate the potential impact from El Niño in South America for next year's results. We've made strong progress on working capital finance over the course of the year since our debt refinancing completed last February, which enabled us to lower our total borrowing cost, extend maturities, improve or remove a number of restrictive covenants, and most importantly, create significant strategic and operational flexibility. We have an improved foundation for our business that is more efficient, more capable, and better balanced, and lends itself to ongoing leverage reduction and the resulting gains in cash generation and net profitability. A combination of global reach and diversified operations and customer base, scale, institutional expertise, and a leadership position in the market is a formula for success. We believe we are well-positioned to close fiscal 2024 on a high note and plan to carry that momentum into the beginning of fiscal 2025 as we work to build a stronger company and together grow a better world. Thank you. Operator, I believe we're now ready to take questions. Thank you. If you would like to ask a question, please press star one on your touch-tone telephone. If you're joining us today using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, that is star 1 to signal with phone questions, star one. We'll go ahead and take our first question from Rosemary Sisson with Odeon. Yes. Good morning, everyone, and congratulations on another good quarter. I wanted to ask you. Thank you. Good morning. I wanted to delve a little bit more into the profitability. The gross margins were higher than I've seen in several years, certainly on a kilo basis. Can you talk a little bit more? You mentioned mix was entered into it, whether kind of what that really entailed and whether it's sustainable, you think, going forward. Good question, Rosemary. Thank you. So obviously, the margins always would depend on the crops as well as the size of the crops. That being said, we're actually doing a fantastic job in terms of our strategy. That is, number one is operational performance. That's number one, and we continue to do so. The second one is related to the working capital management. And so to be able to the cash that we generated, we actually do more with the same cash and continue to grow the business. And then comes the third piece that is actually that we still think that we still have room to go that is related to the cost of borrowing. We still think that we can now start coming down with the cost of borrowing and then be able to have more cash left. So this year, we actually already delivered more than last year, and guidance now is went to $185-$195. So the idea is to continue to do so. Okay. Great. Thank you. But in terms of mix, can you talk a little bit more about what that means? Hi, Rosemary. Yes. Look, each quarter is a snapshot of a multitude of geographies, customers, and products. So as this particular third quarter had a particular mix, that mix was a little bit different from the mix as it was in the third quarter last year. Clearly, we had nice profitability from those products that we ship. And we are focused all the time on improving our operational performance in each and every operation and product in which we trade. So I think you're seeing the result of that, and we continue to be very focused on continuing to develop that performance as well. Okay. Thank you. And then on the cost of borrowing, Flavia, you mentioned that you've been working on that, I know, for a while with your foreign lenders. How much progress are you making? I mean, clearly, the rate there is pretty high. I think you mentioned in your Q it's 9.3% or so on an LTM basis or at least nine-month basis. It seems high relative to the quality of the collateral that's backing those loans. What do you think you need in order to be able to get that lower, and how do your lenders view your credit quality? I agree with you. It's higher than we think our credit rating is. So listen, it goes back to our strategy, right? We talk every day here. What we talk about is leveraging the company and lowering the cost of borrowing. And there's a couple of things, a couple of options that we've been looking and entertaining in order to do that. We have been lowering the cost so far, and you can see that. We also have been actually managing working capital extremely well in the sense that we're paying off the seasonal lines sooner, and that's why we can control the interest cost. We're also looking for opportunities in terms of securitization to lower that cost and also negotiating with the banks in terms of lowering the spread. So you can see that our leverage went below five times for the first time in a long time. The idea is to continue to do so by paying off that and continue to manage this down. We think we're going to have that's with a lot of room to improve, and that's the strategy for the next I would say from now until we'll figure out a way to do so. Okay. You mentioned lowering debt, and yeah, that's the lowest leverage rate I've seen in a very long time. It does seem that it would be a good time to start to refocus on the capital structure and how that could be kind of changed around in order to lower your interest expense, whether that's additional equity, some sort of change to this capital structure that will allow you to move forward and generate more free cash. You also have a $20 million maturity coming up here in August. Can you comment on how you see all of that working out over the course of the next several months? Yes. Yes. So as I mentioned, right, that's our topic every day here, is how we leverage the company, how we lower and we have options, right? We have options from retiring some debt to buying debt at a discount to engaging rating agencies to lower that. We believe that we can lower that cost by the credit rating. We have a lot of options to go through. So that's what we continue to look at it, and we're not ready to announce what the plan is now, but that's our day-to-day conversation. And I'm actually happy that we're able to have that conversation and have, in the near future, continue to leverage the company. I see. Okay. Thank you for that. Also, it seems like your, I think, your inventory is a little bit higher at the end of the quarter than maybe I would have expected. Is that an indication of the opportunity you had to buy right now that you think going into the next quarter, you're ready for? I mean, again, your uncommitted inventories are very low, so I know that part of your constraint has to do with just having enough leaf in order to be able to sell to your customers. Do you still feel capital constrained about that, or do you think you have enough inventory now? Or kind of how do you look at the balance between your short-term debt and your inventory on hand and how it can meet the demand? Rosemary, we're actually very pleased with the inventory levels that we're holding. As you know, our committed inventory is as close to cash as we can get, and we expect to ship that out over the next couple of quarters and generate strong cash flows from that. That obviously continues to roll into our strategy. We obviously chose to do two things with our working capital: clearly satisfy our customer demand in a profitable manner, and two, to repay short-term lines in order to minimize interest cost expense as well. That's where we are at the moment, and that would suggest strong performance as we go forward. Just to add, we don't see constraints on working capital at this point in time. I think the team has done an excellent job in being able to extend that capability across the globe. Thank you. Thank you very much for that. I think that's all I have for now. Thank you very much. Appreciate it. Thank you. Our next question will come from Oren Shaked with BTIG. Hi. Good morning, everyone, and thank you for taking my question after that long list of questions. I only have one question, which is it is good to see the company driving ongoing results and returns on invested capital, but obviously, net debt is still higher here year-over-year. And unless I'm missing something, you're going to end the fiscal year higher year-over-year as well. And so, Pieter, am I to understand your comments on meeting strong demand while maximizing working capital efficiency and some of the other comments you made to suggest that going forward, you do expect to focus more on lowering net debt rather than driving EBITDA, or can you just give us a framework for how to think about your plans to attack that debt level going forward? Thank you. Well, yeah, I think the answer to that is that we can do both. That is what we've been focused on. Obviously, you've seen over the last three years and consecutively on a quarter-by-quarter basis that we've been able to drive operational performance, and we continue to do that. We focus on every small detail in every origin in order to be able to do that. We've been very successful in improving our working capital efficiency and the cycle times and the shipment cadence that we have with various programs that we have. Now, very clearly, with the strong cash flows that we expect to have, we are very focused in terms of our debt, debt structure, debt cost, interest cost. You'll see I think you'll clearly see that in the future. Thank you very much. As a reminder, if you would like to signal with questions, please press star one or touch-tone telephone. Again, that is star one. Our next question will come from Patrick Fitzgerald with Baird. Hi. Thanks for taking the questions. Appreciate the increase in guidance. That's good to see. But could you just remind us why would the fourth quarter be so weak on a year-over-year basis if you hit even the high end of your guidance? Well, our fourth quarter, it's a you have to take a look on the whole year, right? The cycle of the fourth quarter is part of the whole year. It's a different mix of customers as well as products and geographies. That's number one. It's always at the end of the year. It's always some adjustments that can happen at the end of the year. So if you look at the whole year, you'll see there will be delivery in $185-$195 in EBITDA. That's a fantastic result. Remember, last year, we were $158, so already surpassed that point of view. So if you look at the whole cycle, it's a very, very strong year from operational EBITDA. It's a very, very strong year on the working capital management. Again, the opportunity that we have is to continue to lower the borrowing cost, to continue to decrease the interest expense, and able to have more cash at the end. Yeah. No, I get it. It It certainly is a strong year, and I wasn't suggesting otherwise. I just was, I guess, it could be shipments in the fourth quarter of last year versus this coming up year, or you're being conservative, or in any case. So in terms of the fourth quarter, from a working capital's perspective, it kind of bounces around historically. But it sounded from your comments that you think this fourth quarter will be a cash inflow from working capital. Is that fair? And if that's right, what would be the magnitude? Yeah. Every quarter, as I said, is seasonal. That's usually how it works. But it also will depend on our purchases, right? Our focus is also to fulfill the customer's needs. So some of the crops start going early, some not. So that will depend on how that cadence will go. But we are positioned to absolutely actually, we have no capital constraints in terms of buying inventory. So that's the idea to continue to manage that, the working capital, in order to do so. Okay. And if you best-case scenario, do you think you could attempt a refi in 2025, fiscal 2025, a global refi? As I mentioned to you, we look at our options to leverage the company and lower the borrowing cost. We don't know about any timing, but it's one of the options among others. All right. Thanks a lot. Thank you. That does conclude the question-and-answer session. I'll now turn the conference back over to Tomas Grigera for any closing remarks. We're pleased to have been able to share such good results with you this morning and look forward to talking with you again soon. Thank you. Thank you. That does conclude today's conference. We do thank you for your participation. Have an excellent day.