Good day, everyone, and welcome to today's Standard Motor Products fourth quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-and-answer session. You may register to ask a question at any time by pressing star one on your telephone keypad. You may withdraw yourself from the queue by pressing star two. Also, today's call is being recorded, and I will be standing by if anyone should need any assistance. Now, at this time, I will turn things over to Mr. Tony Cristello, Vice President, Investor Relations. Please go ahead, sir. Thank you, and good morning, everyone, and we appreciate you joining us for our Standard Motor Products fourth quarter 2023 earnings conference call. With me today are Larry Sills, Chairman Emeritus, Eric Sills, President and CEO, Jim Burke, Chief Operating Officer, and Nathan Iles, Chief Financial Officer. On our call today, Eric will give an overview of our performance in the quarter. Jim will provide an update on our Shawnee DC, and Nathan will discuss our financial results and our annual guidance. Eric will then provide some concluding remarks and will open up the call for Q&A. Before we begin this morning, I'd like to remind you that some of the material that we'll be discussing today may include forward-looking statements regarding our business and expected financial results. When we use words like anticipate, believe, estimate, or expect, these are generally forward-looking statements. Although we believe that the expectations reflected in these forward-looking statements are reasonable, they are based on information currently available to us and certain assumptions made by us, and we cannot assure that they will prove correct. You should also read our filings with the Securities and Exchange Commission for a discussion of the risks and uncertainties that could cause our actual results to differ from our forward-looking statements. I'll now turn the call over to Eric Sills, our CEO. Thank you, Tony, and good morning, everyone, and welcome to our fourth quarter earnings call. I'd like to open by thanking all of the SMP employees globally whose tireless commitment to SMP makes us who we are. The fourth quarter capped was a fairly challenging year for SMP. As noted in our release, we saw some different trajectories for our aftermarket business versus our Engineered Solutions business, with nuances throughout, so let me get into it by segment, starting with Vehicle Control. Entering the fourth quarter roughly flat to 2022's record year, Vehicle Control demand softened as the fourth quarter progressed, and we finished the year down 1.7%. As previously discussed, we were impacted throughout the year by two largely non-recurring events. First off, we continue to see the impact of the previously announced customer bankruptcy, and to a lesser extent, we saw less pipeline activity from some of our larger customers throughout the year. But beyond that, we saw a general softness in the market in the fourth quarter, as evidenced by our customer POS results, which declined as the quarter progressed. That said, we believe this is largely temporary in nature as marketplace dynamics remain strong, and we have seen a modest resurgence as 2024 gets underway. Next, I'll discuss our Temperature Control business. As you know, since the majority of the business is tied to air conditioning, it's subjected to more weather-related influences than the other parts of our business. Not only is it seasonal in nature, the timing of weather patterns throughout the year can impact the market. It is important context to note that 2022 was an outsized year. It got hot early and set records all summer long, beating 2021 sales by over 8%, making for a difficult comparison. 2023 behaved quite differently. We had a slow start to the selling season and were well behind on sales entering the third quarter. It finally did get hot in much of the country, and we were able to make up a fair amount of lost ground in the third quarter, yet it was too little, too late, and we finished the year down 3.8%. The fourth quarter itself was very light, but we cautioned people not to read too much into it. The fourth quarter is always our lowest period by a lot, with customers making certain stocking decisions that can have big influence on a small quarter. Lastly, I would note that while it's still early, it appears that our pre-season orders for 2024 are consistent with past years. That sums up the aftermarket. Meanwhile, we're very pleased with our Engineered Solutions segment, our business focused on global non-aftermarket sales into various end markets. We posted strong sales both in the quarter and for the full year, up 6.7% and 4.7% respectively, with progress being made on multiple fronts. After several years of growing this business through both acquisitions and organic product development, we chose to split it out into its own segment at the beginning of 2023. Not only has this provided better clarity to various stakeholders, we also believe it has helped demonstrate to the customers in this space that we are genuinely committed with a tailored strategy, a broad product portfolio, and dedicated resources, and this is truly opening doors. We're seeing gains with existing customers as well as new ones, and while it often takes time between a business being awarded and when its sales actually begin, the pipeline is robust globally, and we're very excited about where it's headed. Turning to profitability, all year long we have been facing stubbornly high inflation across a host of cost inputs. Furthermore, our customer factoring expenses continue to present a headwind, up $14 million as compared to 2022. I'm proud of the progress we made both with cost reduction initiatives and pricing actions, allowing us to retain our gross margins on a full-year basis, but the headline is that soft sales caused deleveraging of our fixed costs, which in turn hurt our bottom line, and Nathan will provide more details during his remarks. First, let me turn it over to Jim, who will bring you up to date on our exciting new distribution center. Thank you, Eric. Good morning. I'm happy to share an update on our distribution network strategy expansion plans. We previously announced our new Shawnee, Kansas distribution center in our second quarter 2023 earnings release. To refresh your memory, our U.S. distribution footprint, excluding our Forecast Trading distribution from Fort Lauderdale, Florida, for Vehicle Control and Temperature Control products, currently ships from three primary distribution centers located in Disputanta, Virginia, Edwardsville, Kansas, and Lewisville, Texas. This combined footprint is approximately 1.2 million sq ft. Our plan is to add our new Shawnee DC, to replace our existing Edwardsville DC. The new 575,000 sq ft Shawnee facility is within five miles of the existing Edwardsville facility, which will add 211,000 incremental sq ft for a new combined 1.4 million sq ft footprint. We believe the Shawnee addition will offer us many benefits over our existing network strategy. Today, we are single-point distribution for our products from our existing three DCs. Our new strategy will be to add popular A and B high-volume SKUs into Shawnee that are also carried in Virginia and Lewisville. For Vehicle Control, Shawnee will ship the popular A and B SKUs to customers west of Mississippi that previously were shipped from Virginia totally across the country. Slower-moving SKUs will continue to ship from Virginia. For Temperature Control high-volume SKUs, Shawnee will ship the upper half of the U.S., while Lewisville will ship the southern half of the states. This will provide us many strategic benefits: risk avoidance with multi-point distribution on popular SKUs, reduce existing capacity constraints in Virginia and Lewisville, faster turnaround time for pulling, packing, and shipping orders within our DCs, transportation cost savings, labor efficiency savings due to overcapacity, and retaining 100% of our seasoned and experienced existing management team and associates from our Edwardsville facility. Lastly, incremental distribution capacity for future growth opportunities. Our transition plan is basically on schedule, as initially disclosed. The Shawnee construction and interior build-out plan was essentially completed in January of this year. Our phase I operational plan called for a soft launch in 2024, with racking installed and RF manual picking commencing April of this year. Phase II will entail the installation of automated picking modules and automated consolidation, completion scheduled for early 2025. By the end of 2025, we expect to be fully operational. Costs and savings from this distribution expansion will be incurred over multiple years. 2023 and 2024 will see added costs, while savings will be achieved in 2025 and 2026. Overall, from an expense standpoint, once fully implemented, we will be incurring incremental lease, property, and depreciation costs per year of approximately $7 million, offset by efficiency and transportation savings of approximately $3 million for a net ongoing cost inclusive of incremental capacity of $4 million. In addition, we expect to fully exit our own Edwardsville facility by the end of 2025 and anticipate cash proceeds from the sale of the land and building of $20 million plus in 2026. Most importantly, we will be in a much stronger position to better service our customers with added capacity for future growth. Thank you for your attention. I'll now turn the call over to Nathan. All right. Thank you, Jim. As we go through the numbers, I'll first give some more color on key drivers of our results for the quarter and full year of 2023, and then provide an update on our financial outlook for the full year in 2024. First, looking at our Vehicle Control segment, you can see on the slide that net sales of $178.6 million in Q4 were down 5.9%, with the decrease driven by a general softness in sales across the industry. For the full year, sales in Vehicle Control were down 1.7%, with the decline owing to a number of things which occurred during the year, including the impact of a customer bankruptcy early in the year, lower pipeline orders, and the general slowness we saw in Q4. Vehicle Control's adjusted EBITDA was 11.8% of net sales for both the quarter and full year, with both periods down from last year. Looking at the drivers of EBITDA for the quarter, the gross margin rate for Vehicle Control in Q4 was down primarily due to lower sales volumes. Further, SG&A expenses in Vehicle Control increased in the quarter, partly due to about $1 million of additional expense related to the startup of a new distribution center, and that coupled with lost levers due to lower sales resulted in lower adjusted EBITDA. Looking at Vehicle Control EBITDA for the full year, the EBITDA margin rate decreased 1 point. While the gross margin rate benefited from pricing and savings initiatives, this was more than offset by a combination of higher factoring costs and higher SG&A as a percentage of sales. For the full year, SG&A included about $2 million of additional expense for our new warehouse. While Vehicle Control's adjusted EBITDA is down year-over-year, I would point out that we've made a lot of progress offsetting the headwinds we faced recently, as our gross margin improvements offset the rising costs of factoring programs for the full year. Turning to Temperature Control, net sales in the quarter for that segment of $44.6 million were down 19%, and sales for the full year were down by 3.8%, as we saw a very soft fourth quarter after the primary selling season ended. Temperature Control's adjusted EBITDA in Q4 was lower than last year and was driven primarily by lower sales volumes, which led to lower leverage of operating expenses in the quarter. Temperature Control's adjusted EBITDA for the full year of 6.7% of net sales was down from last year primarily as a result of lower sales volume, which put pressure on the gross margin rate and led to loss of leverage on operating expenses, but it was also due to the higher costs of customer factoring programs during the year. Sales for our Engineered Solutions segment in the quarter were up 6.7%, and sales for the full year there were up 4.7%, as we were pleased to see our sales continue to increase as a result of strong demand and new business wins with both existing and new customers. Adjusted EBITDA for Engineered Solutions in the quarter was down from last year, as a change in mix of sales during the quarter resulted in lower gross margin for this segment. As a reminder, this segment has a widely diversified portfolio of products and customers, and therefore the gross margin rate can vary quarter to quarter. While the fourth quarter was down, our Q3 rate was up significantly, so it's important to look at the full-year margin rate for this segment. For the full year, adjusted EBITDA for Engineered Solutions was 11.5% and up 0.2 points from last year. The improvement for the year was the result of strong sales growth and a slightly improved gross margin rate. Turning to our consolidated results, net sales in the quarter were down 5.7% due to lower sales in the aftermarket. For the full year, sales were down 1%, as lower aftermarket sales were only partly offset by the growth in Engineered Solutions. Our consolidated gross margin rate declined for the quarter, mainly due to lower sales volumes. However, our gross margin rate for the full year finished up 0.7 points, as our pricing and savings initiatives overcame lower volumes and other headwinds we faced. Regarding SG&A, expenses were up in Q4 due to costs related to our new DC and some timing between quarters, but overall were well controlled. SG&A costs for the full year were up mainly due to distribution center startup costs and some inflation in overall costs, and were higher as a percentage of net sales due to lower sales volumes. The cost of customer factoring programs increased by $14 million in 2023, but you can see the cost leveled out in the fourth quarter, and we're hopeful rates will begin to come down later this year. Looking at the bottom line, consolidated operating income and adjusted EBITDA in the quarter were lower than last year, as lower sales and higher factoring costs led to lower profits. For the full year, consolidated operating income and adjusted EBITDA were down, as higher factoring costs and lower sales volumes were only partly offset by improvements in our gross margin. Turning now to the balance sheet and cash flows, the key item here is our inventory level, which finished the year at $507.1 million, down $21.6 million from December last year. Our cash flow statement reflects cash generated from operations for the year of $144.3 million as compared to cash used of $27.5 million last year, with the improvement driven by a $97 million improvement in cash flows from inventory and a $68.2 million improvement in cash used for accounts payable as operations normalized during the year. Financing activity shows significant progress made in paying down our credit facilities by $83.6 million as a result of our improved operating cash flows. We also paid $25.2 million of dividends during the year. Our borrowings of $156.2 million at the end of Q4 were much lower than last year, and we finished the quarter with a leverage ratio of 1 x EBITDA, 33% lower than last year's ratio. Before I finish, I want to give an update on our sales and profit expectations for the full year of 2024. Regarding our top-line sales, we expect full-year 2024 sales will show flat to low single-digit percentage growth, as noted in our release this morning. Adjusted EBITDA is expected to be in the range of 9%-9.5% and essentially flat with 2023. This estimate includes an operating profit rate flat with 2023, as savings and pricing initiatives offset inflation, factoring expenses of $45 million-$48 million largely flat with 2023, as we remain in a high and uncertain interest rate environment, and some additional costs related to the expansion of distribution capabilities in a new warehouse in Shawnee, Kansas, as Jim highlighted before. I would also note that we saw the U.S. dollar weaken against key currencies in 2023, and it has remained at those lower levels to start 2024. In connection with our adjusted EBITDA outlook, we expect our interest expense on outstanding debt to be on average about $3 million-$4 million each quarter, given flat interest rates, and we expect our income tax rate to be 25%. Borrowings are expected to remain flat by December 2024. As cash flows normalize, we look to invest approximately $25 million in our new DC and return cash to shareholders via dividends. To wrap up our outlook, let me make two notes regarding the cadence of these items across the year. First, regarding the cadence of earnings across the four quarters in 2024, we expect Q1 will be impacted by headwinds from several things, including the higher costs related to the startup of the new DC and slightly higher year-over-year costs from customer factoring programs as we finally lap rate increases. Second, keep in mind our operating expenses are incurred ratably across the year and do not vary with top-line sales. And we anticipate total operating expenses, including factoring costs, will be approximately $78 million-$80 million each quarter in 2024. To wrap up, while the year ended slower than we hoped, we were very pleased with our efforts to improve our gross margin rates across all segments, as well as turn in significant improvements in cash flow. We were very much appreciative of the efforts of all of our team members in meeting these objectives. Thank you for your attention. I'll now turn the call back to Eric for some final comments. Well, thank you, Nathan. In closing, as you've heard, 2023 was a year of ups and downs. And while the numbers reflect some of the challenges faced in terms of cost pressures and temporary market dynamics, we have a lot to be proud of and to be excited about. We remain extremely bullish on both of our end markets. The aftermarket has a long history of resilience. There can always be some short-term highs and lows, and while 2023 was a disappointing year, on balance, it is an extremely stable industry and tends to outperform during difficult economic times, especially in nondiscretionary categories like ours. Our position within the aftermarket also remains strong. We have excellent relationships with our trading partners who continue to recognize us as a leading supplier through the numerous awards that we win. We continue to be very excited about our Engineered Solutions business. Quite different from the aftermarket, where we enjoy strong market share, here we are not so much rising on the dynamics of the market itself as we are on getting known as a strong supplier with diverse capabilities and winning new business. Here, I believe we have tremendous potential. There are multiple end markets, from commercial vehicle to construction and agricultural equipment to power sports. Furthermore, the opportunities are global, and we're able to take advantage of customer adjacencies with operations in North America, Europe, and Asia. We do recognize we have work to do on profitability and continue to pursue cost reduction initiatives throughout our organization, as well as pricing actions, and look forward to progress moving forward. While 2023 had its challenges, we are very excited about the future. That concludes our prepared remarks. At this point, we'll turn it back to the moderator and open it up for questions. Thank you, Mr. Sills. Ladies and gentlemen, at this time, if you do have any questions, please press the star one on your telephone keypad. You may remove yourself from the queue at any time by pressing star two. Once again, that is star one to ask a question, and we will pause for just one moment to allow questions to queue. We'll go first today to Daniel Imbro at Stephens. Hey, guys. This is Joe Enderlin on for Daniel. Thanks for taking the question. Morning. Good morning, guys. Looking at Vehicle Control, point-of-sale activity slowed through the quarter, and you noted some volatility in customer ordering patterns. Is it safe to say you're seeing customers destocking? And if so, how long do you expect this will continue? Yeah, thank you for the question. Really, no, it's not a matter of destocking. As we look at their inventories, they've been basically flat over the course of the fourth quarter. Really, it had more to do with just a softening in the marketplace of their end demand. I think that you're kind of hearing that from the big publicly traded distributors on their earnings calls, that as the quarter progressed, things softened out there. As I did mention in my prepared remarks, we are encouraged to see that more recently we've seen a bit of a rebound. Don't want to judge things week to week, but we're encouraged by what we've seen more recently. Got it. As a follow-up, I guess, before that rebound, was there any particular parts or categories you were seeing customers defer orders? It was really across the board. You have to recognize that we are in so many diverse categories within Vehicle Control, hundreds of different categories that we really don't track individual ones to that extent. Got it. If I could ask one more, looking to the guidance for 2024, it seems like EBITDA margin is relatively flat with 2023. Could you maybe talk about your conviction in returning to a double-digit margin, or can you maybe break it out why this is more of the long-term expectation for EBITDA margin here? Thanks. Yep. Yeah. So we did guide flat, as you noted. And a couple of things to keep in mind. One, Jim talked about the new DC that we're putting in, and there will be some higher costs related to that in 2024. We also have factoring costs that remain elevated. And so while we're certainly working on pricing and savings initiatives that continue year in and year out, 2024 will be flat. We would expect, as we always talk about, in the long term to improve the bottom line incrementally each year, sometimes to 10, 20 basis points, maybe a little bit more depending on what's going on. So we would expect that to improve long term, but 2024 is flat. Got it. That was very helpful. Thank you, guys. Thank you. Thank you. We go next now to Bret Jordan of Jefferies. Hey, good morning, guys. Morning, Bret. Morning. Could you talk a little bit about sort of the price contribution to growth in 2023 and maybe what you're expecting for 2024? Are you getting any price relief for your factoring expense, I guess, specifically? Yeah. So we were able to push through some pricing in 2023. And so yeah, some of the growth that we did see was that more so than units. That's where you're heading with it. And as we head into 2024, nothing specific to report. We are continuing to look for pricing opportunities. It is a competitive market out there, and so we do have to work closely with the accounts to get everybody to understand what's happening to the cost structure. But we are continuing to work on it. Okay. And then I guess you talked about the Auto Plus bankruptcy last year, but is that channel or those who picked up their market share underperforming in your mix? Was that the issue you face on a year-over-year basis, or just yeah, I guess that's the question. Yeah. I think I'd package it differently than that, Bret. It's not that they're underperforming, but when you have a large distributor that goes out, it's going to take a while for the channel to absorb that inventory. There's been a lot of store closures. There's been a lot of duplicate locations that are being worked through. And so you spent the first six months of 2023 at basically a zero-revenue position as they were unwinding the bankruptcy, and that was a big hurt in the first half. The second half, once it went to its new owners, wasn't like flipping a light switch and it went back to normal. There was a lot of consumption that needed to happen, and we see that continuing. It's really hard to track it because now it does just kind of get lost in the mix. But no, it has not fully recovered, and we could see that really taking a while for it to shake out when you have a business that had as many locations as that that need to get absorbed. Do you see any sort of spread between, I guess, the health of the WD market in general versus other larger players? I mean, are there other potential issues out there as far as distribution or customer changes? Yeah. Look, we believe that if I understand your question, you have a lot of different accounts out there from the large national retailers to the more regional warehouse distributors. Many of them are still very healthy, well-capitalized, investing in the business and are going to do very well. Will there continue to be ongoing consolidation in that space? I think that's a natural progression in a mature market. We've seen that over the last several years, whether they're acquiring each other or being acquired by the big guys. And I guess the good news for us is that we do tend to do business with all of them. So as those consolidations happen, we tend to fare okay. Okay. And then I guess the last question, a large national retailer, an engine management that went private label, have you seen any volume return there, or are they still primarily private label? We believe that they are still largely private label. We watch them and what their strategy is in the marketplace, and I guess that's all I have to say about that. Did that give you a market share gain as a result of that shift for you? I believe that there was a few years ago when it first happened, and we really went arm in arm with our other trading partners to go after that share at the installer level. We're quite confident that we did pick up a lot of it because these were installers that were looking for our brands, and they were available in the market. We just needed to point them to that. So I do believe there was a pretty substantial market share shift at that time and a share shift that we've been able to retain or that our customers have been able to retain. Okay. Great. Thank you. Thank you. Ladies and gentlemen, just a reminder, star one, please, for any further questions today. Gentlemen, it appears we have no further questions today. I'd like to turn the conference back to you, Mr. Cristello, for any closing comments. Okay. Thank you. We want to thank everyone for participating in our conference call today. We will be happy to answer any follow-up questions you may have. Our contact information is available on our press release or investor relations website. Hope you have a great day. Thank you. Thank you again, ladies and gentlemen. That will conclude the Standard Motor Products fourth quarter 2023 earnings conference call. We'd like to thank you all so much for joining us and wish you all a great day. Goodbye.