Only to moderate the agenda. Okay, thank you. We're gonna get started. We're gonna start the afternoon sessions and this afternoon we're gonna start with Sotera Health. Sotera Health is an end-to-end sterilization and lab testing services company that caters to the med- surg equipment manufacturers as well as other end markets. And, with the company, I'm happy to have Jonathan Lyons, CFO, and Jason Peterson with investor relations. Jonathan, thanks for joining me. Thanks a lot, Ryan. Good to be here. I wanted to start with the leadership transition that you guys announced recently. Just wanted to get an update. Any more details on the succession timeline and any perspectives you could add just on Alton's, you know, background and experience that you're excited to have on board? Great, thanks. Before we get started, I do have to cover the legal side. I may make some forward-looking statements today. Please refer to our SEC filings for a list of risks and uncertainties related to those. Now I'll answer your question. No, we're excited. I'm excited. I had a chance to talk to Alton a couple of times since he's been appointed. You know, the board ran an exhaustive search, you know, in coordination with Michael, you know, really looking for the right person for the role. You know, just from a timing perspective, you know, I think Michael was interested in taking a little bit of a turn. His view is that, you know, the CEO role should be two terms. You know, kinda four years, and then move on. He's nearly a decade, about a decade in. He felt like it was a time for transition for him. I think it's a sign too of the position the company's in. I think we'll talk about that a little bit later, you know, from a positive perspective. Alton's starting next week. He's got a deep med device experience with Hillrom, Baxter, most recently as CEO of Viant. You know, we're excited about what he brings and what I understand is a very strong commercial orientation. In my conversations with him, he impresses me as one who's very complete. Might have a commercial orientation, but is a complete kinda package from operational commercial strategy. We're really excited to get him on board and that transition starts next week. Great. Just maybe wanted to touch on the broader demand landscape. You know, you guys talked. First off, reported a very strong quarter in terms of volume as well as overall revenue growth. I think you highlighted March as like the strongest volume month in years for Sterigenics. Also mentioned April, those trends continued. Any color just on the market dynamics, where you're seeing this demand really coming from or any other kind of color around, you know, types of customers or ways for us to appreciate that? Yeah, no. Thanks, Ryan. You know, Sterigenics, you know, obviously our biggest business, 2/3 of the company, you know, really important to see that volume and mix growth in the business. We look back on the quarter, it was very much in line with what we expected when we guided for the year and gave some specific guidance on the quarter. You know, a little slow start to the year. January and February, which I think is pretty well documented across the space, you know, the weather had an impact on procedure volumes, it appears, and certainly had an impact on our business. You know, we grew 6.1% on a constant currency basis. Would have been, you know, nearly 8% with the weather impact. We felt good about the start to the year. March was really strong, as you mentioned. Probably a little bit of catch-up from January and February with some of the weather impacts. Again, net-net, it still was a sizable headwind for the quarter. Got off to a good start in April, and as we sit here today, we're feeling good about the guide that we gave. You know, particularly as we ramp up in the second half, you know, our guide for Q2 is similar in growth to Q1, coming off a tough comp in Q2 of last year. The second half, the comps ease a little bit from our downtime, our maintenance schedule that, you know, has a headwind or tailwind depending on what goes on. It's a headwind in the first half, it's a tailwind in the second half. We're seeing just good fundamental demand from our customers across the med device space. We've seen good demand to date and we, you know, we have good line of sight to what we're seeing going forward. We also have our new X-ray facility coming online which will provide a little bit of tailwind then there's been a lot of discussion about another customer that's not big, but it's a pretty good transition for us in the EO space from an insourced to outsourced perspective that's gonna start contributing. Great. How do those trends continue from April into May? Yeah, I mean, it's, I mean, we're middle of May. you know, like I said, we feel good about the guidance that we've given in those conversations and the indicators about where the market's going and what kind of demand we're gonna see for the balance of the year continue to be there. I feel good about the quarter, I feel good about the year. Excellent. You just mentioned the customer converting from insourcing to outsourcing that you're expecting to contribute later in the year. Any other, any way you can help us size or just put into context the contribution that you expect from that customer? Yeah. I know I brought it up, and it's something that's turned into kind of a much bigger talking point around the business and the industry than it is in size of customer just because of the fact that it's, you know, relative to the new regulation and it was an outsource versus a, you know, an insource versus an outsource conversion. It's not like we have to build a facility for this customer. It's already an existing customer in different parts of the world and different places. It's a meaningful impact to the business, but, you know, it's not like a we're gonna go build a facility for them or anything like that. Got it. Okay. The other driver of growth, you know, pricing has certainly been an area of strength. 4.5% pricing growth in the first quarter. You've been guiding towards the high end of your historical range on pricing. Just, you know, maybe any sort of outlook as to the sustainability of that pricing power you guys have enjoyed? Yeah. No, I don't like to use the word pricing power. There's a customer on the other end of all these discussions. Those are never easy discussions. I think we're recognized because we play an absolute critical role in healthcare with a highly regulated industry. What we do is not easy, and it's not core to what many of our customers do. There's good value for the work that we do, and I think we're recognized for that work. That's been demonstrated over years. The business has grown, Sotera Health's grown every year for 20 years. If you look at since we've been public, we've had good pricing improvement year on year. It's adjusted based on accelerating inflation, you know, earlier in the decade. We've seen that consistent performance, and there's no reason we anticipate that changing. You know, we've continued to deliver it quarter in, quarter out, and I don't expect that to change. Maybe moving on to the Nelson Labs segment. I think you've finally lapped some of the difficult comps after a record year in late 2024. Yep. You know, margins in the business I think are still suboptimal relative to your targets. You know, just what gives you the confidence that, you know, you'll be able to execute on that margin story in Nelson Labs? Just, you know, any sort of color on pipeline or? You know, you talked about validation projects and where there is a building pipeline. Any sort of visibility into that would be great. All right. Well, I think you had like five questions in there, Ryan, I'm gonna try to tackle them. We're not done. Catch me if I got, if I miss anything. I'll back everybody up a little bit. You mentioned 2024. Yeah, the expert advisory services had a really strong, a record year in 2024. I mean, it was like, what, a $230 million business overall, and it was $34 million. That was really driven by some one-time remediation projects. We saw that coming, I think, in the end of 2024. We started messaging that we saw a little bit of a cliff, you know, a headwind coming related to those remediation projects cycling off and the expert advisories business, you know, suffering accordingly. The business dropped from $34 million to about $10 million from 2024- 2025 and had a even a bit of a headwind coming into this year. As you mentioned, we're just lapping kind of the last comp on this Q1 of that headwind. That's behind us. You know, in the middle of facing that headwind, we also improved margins over 300 basis points last year, and we got the margin rate into our low-to-mid 30s target that we had. I think what you're referencing in Q1 margins were down year-over-year. It's the slowest month, slowest quarter of the year. January and February, like in Sterigenics, were really soft. The margins were pretty terrible, honestly, when I look at January and February. That's really volume-oriented. You know, it's a highly labor-intensive business, and scale or, you know, volume matters a lot in the lab testing side. We can't You know, if you have a couple slow months, you can't adjust your workforce that quickly. It becomes almost a fixed cost for you. You know, it's kind of semi-fixed. You know, as we came into March, volumes were back where they're supposed to be. The EBITDA margins were back where they were supposed to, even on the high end of where I thought they might be. We're feeling good about the margin recovery in the business. When the volumes are there, the margin's there, and we saw that performance continuing. As I look at the volumes for the rest of the year, there's a number of things that are coming through. Number one, you've got Sterigenics volumes. When Sterigenics is processing, we're testing to support you know, the lot release and validate that the sterilization was successful. Those accelerate. The validation pipeline, which we've said has been choppy, depending on new regulations, R&D funding, things like that, you know, new products, those sorts of things coming through, we've got good visibility into, you know, a validation pipeline of work coming in. Normally Nelson is very short cycle. That can give us a little bit more visibility. We've got the new regulations in with validation pipeline associated with that. We've got a couple of initiatives. We've got our new clean room coming online in the second half. We just did an open house. We've got a good pipeline building for that as it comes online in Salt Lake City. We're excited. We see good revenue growth and feel good about the guide that we've given there for the back half acceleration. Great. On the strategic, did I get them all? You did. All right. Good. I wanted to go back to one of the points you made, sort of the cross sell between Sterigenics. Yeah Nelson Labs, and that's been a big part of the investment thesis of Nelson Labs. I think you had previously maybe sized a synergy opportunity of $15 million, and I'm just curious, you know, how you've progressed to that goal. Yeah Is that still a goal that's out there? Yeah. Thanks. Yeah, we did put that goal out there a year and a half ago. I'd say we're making good progress. It, it's never as fast as you want it to go. You know, our XBU customers, the customers that are doing business with both businesses generated about 70% of the revenue for the two businesses. It's a really critical customer base. That group of customers grew 10% last year, which was faster than the total enterprise. We're feeling good about the progress we're making there. We still got plenty of work to do, plenty of opportunity to accelerate that growth. We keep focused on it, we're making good progress. Okay. Switching gears to capacity, always topic of conversation. You know, I think you've been citing capacity utilization at 80%, or at least that's kind of the target. Yep. Now you're talking about adding to your capacity. You know, maybe just how do you feel today about your current capacity against that 80% target? Is there, you know, wiggle room or I shouldn't say wiggle room, but do you feel like you're nearing that target? For, by modality? As we look at it, capacity utilization really comes down to a modality in geographic evaluation, because that's what drives the business. Customers need the right modality in the right location with the right service level to support them. Depending on where you are in the globe, Well, generally speaking, EO is tighter than gamma. We got a good amount of capacity available in gamma, and we have the ability to expand capacity in a lot of our sites to add to gamma. EO is where there's a considerable amount of tightness, and that is even variable too on large chamber versus small chamber. You know, think about a truckload of pallets, you know, versus a less than full truckload of pallets. The large ones are pretty tight across the U.S. and in different parts of the world, and the small ones have more availability. That's, that's a piece where we really focus on, you know, optimizing our facility throughputs to create capacity where the customers need us. Okay. You know, the big story is we've got room to grow and deliver against what we've committed to, especially with the new facilities coming online that'll help support that too. Okay. Maybe just to clarify, so the new facility you have coming online is more of the X-ray modality? Mm-hmm. Yep. How does that sort of help to loosen some of the capacity? It doesn't help loosen the EO. Okay It's in a good place where we know customers are going to need us with that capacity, and so it's going to help support our growth. Got it. Okay. Just the timeline for when that facility is expected to come online? It's coming on right now. It should start to contribute in the second half. We have a second greenfield that comes on late 2027, early 2028, that'll start contributing in 2028. Okay. regarding the EO litigation You had a favorable update in terms of the dismissal of the eight Georgia bellwether cases recently. Yep. You know, how are you thinking about, I guess, the legal situation in Georgia? You know, I know California is one of the next big sorta cases, which is more like early 2027. You know, anything investors should be paying attention to leading up to that? Yeah. No, I think a couple of things. First off, what we've always said is when science is front and center and fairly represented in the courtroom, it proves that these claims have no basis, and that's what happened in Georgia. Science was in the courtroom, and you know, it was demonstrated that there was no causality here between emissions from our facilities and the plaintiff's claims, and those cases were dismissed. We're gonna go through the appeal process. Obviously, that's a key thing, so we're not done there. You know, we are seeing. I think when that is in forefront, and not just us, with other defendants, you're finding that, you know, we have a good posture. We've, you know. California's coming. We're going through the pretrial motions and discovery and depositions and all those things, and we'll work to play that out. It appears so far that science is gonna be front and center there. You know, it remains to be seen exactly how that plays out, and we'll continue to monitor it and make sure we manage it effectively like we've been managing these cases very effectively for the last few years. And just- Trials are January and April of 2027. You mentioned you're already going through some of the pretrial motions. Can you remind me, when is the Daubert hearing? Yeah. You know, that presence of science? Yeah. That's happening over the coming months. Okay. Weeks, months, I mean, this is eminently happening. Helpful. Wanted to talk about the NESHAP rule change that is in the proposal phase right now, and I know it's in the commentary stage. You know, how has that been impacting the industry, I guess from a, you know, decisions like do we insource or do we outsource versus insource or, you know, do we build new facilities? You know, are you seeing that proposed rule where it potentially could get finalized? Is that already impacting industry on decisions like those that I mentioned? Yeah. It has impacted decisions. I mean, you think about the customer I referenced already that decided to go from insourced to outsource. Excuse me. The timelines and the implementation timelines has just created an uncertainty, but also just deferred it. Deferred what were seemingly more imminent decisions that small players might make, some small outsource providers might make to go out of business or sell their facilities or make improvements. It just kicked the can a little bit down the road as the, you know, as the regulators have reflected in potentially adjusting the regulations and moved the timelines out. It's kinda just slowed things. Our dialogues with customers and other industry kinda slowed down from a much more heated level or heated pace than they were, you know, a year and a half ago. Okay. You guys have made a lot of investment in your facilities to meet the new standards that are now being proposed to be rolled back. Right. Help, if you could please help us understand, you know, how does that still impact your competitive position in the market in terms of those investments? We've made those investments. We're ready to comply with the standards that are finalized, whether they're the standards that were promulgated in 2024 or what's being contemplated now. One thing to clarify, the old rule was difficult. The 2024 rule was really difficult. When we say roll back the 2024 rule, what we'll call it the 2025 rule, it's still way more difficult than the old rule. Everybody's gonna need additional improvements, additional capabilities in their facilities to make sure to comply even with that rule. Then who knows where the rule might be two years from now. We're continuing our investments. We're gonna be an industry leader in this, and we're ready to be there, and we'll be there for the long term to support our customers. Okay. Your guidance, it implies some high single digit growth in the back half of the year. You know, after, I guess more mid-single digit growth so far. In the first quarter. You know, you mentioned the new insourcing shifting to outsourcing customer, the X-ray capacity. Any other swing factors in terms of, you know, the visibility you have into the second half of the year? I mean, we're having great dialogue with our customers. You know, they wanna make sure we've got the capacity there when they need it. We've got, you know, some visibility from that. Things can always change. We've got good dialogue with our customers, what we expect, good pipeline of validations converting to normal sterilization. We got lower maintenance downtime in the second half than the first, which will turn to a tailwind. We've got those couple of things that you referenced. There's a bunch of things adding up to shape up for a really good second half. Great. I wanted to touch on your shareholder base. You know, there's been some change over the past few months since the end of last year, where you've seen some of the insider holders now fully sell their positions. Some of the private equity sponsors. You know, maybe you could share with the audience just, you know, how should investors think about your shareholder base now going forward now that your private equity sponsors have liquidated their position? Yeah. No, great. I mean, when I joined the company three years ago, 60% of the shares were held by the private equity owners, or former private equity owners. You know, and it was a overhang on the stock, and now that's gone. You know, when I look back and I look at what we've done over the last years, and I'm tying it to when I started. I'm not claiming responsibility or, you know, pounding my own chest about what we've accomplished, but, you know, the private equity ownership is out. Our leverage ratio is back into a spot where I think it's more palatable for a lot of the investment base, investor bases. We were at, like, four times. Now we're nearly three times levered. We've taken interest expense. We're actually just closing on another repricing of our loan and our term loan. In the last nine months, we've taken out 100 basis points of interest cost out of the term loan. That's $14 million a year. You know, litigation had much more ambiguous, kind of views around it. We've walked through how much clarity we have, still work to do, but things are much more clear and, I think from my view, evidently manageable from where we are. I think what that's doing is you're kind of pushing these things aside and everything that everybody loved about this business, the strength we have supporting customers in highly regulated markets, sticky customer relationships, critical to healthcare. We deliver price every year. We deliver growth every year for 20 years. People are now able to focus more on the fundamentals of this great business versus some of the challenges that we've had to deal with over the last few years. I'm excited about where we are. I think it's a great opportunity to dig in and learn more about Sotera Health. Great. Maybe just one final one. Macro, you know, factors to the business. Anything that, investors should think about in terms of, you know, geopolitical or energy costs? I mean, you know, energy is a very small component. I came from glass melting industry. I thought about energy costs every day. I worry about supply. I don't worry about the cost 'cause it's a very small base, and I don't worry about supply 'cause I've done the diligence and know that we're in good shape from a supply perspective. There, you know, very small sales, like into the Middle East, for example. There's not a lot to worry about with respect to those kind of exposures right now. Great. All right. We'll wrap there. Thank you very much.