Good morning, ladies and gentlemen, and welcome to the Trinseo Q3 2023 financial results conference call. We welcome the Trinseo management team, Frank Bozich, President and CEO; David Stasse, Executive Vice President and CFO; and Andy Myers, Director of Investor Relations. Today's conference call will include brief remarks by the management team, followed by a question-and-answer session. The company distributed its press release along with its presentation slides at close of market Friday, November third. These documents are posted on the company's investor relations website and furnished on a Form 8-K, filed with the Securities and Exchange Commission. If anyone should require assistance during the call, please press star, then zero on your telephone. And now I'll hand things over to Andy Myers. Please go ahead. Thank you, Bo, and good morning, everyone. At this time, all participants are in a listen-only mode. After our brief remarks, instructions will follow to participate in the question-and-answer session. Our disclosure rules and cautionary note on forward-looking statements are noted on slide 2. During this presentation, we may make certain forward-looking statements, including issuing guidance and describing our future expectations. We must caution you that actual results could differ materially from what is discussed, described, or implied in these statements. Factors that could cause actual results to differ include, but are not limited to, risk factors set forth in Item 1A of our annual report on Form 10-K or in our other filings made with the Securities and Exchange Commission. The company undertakes no obligation to update or revise its forward-looking statements. Today's presentation includes certain non-GAAP measurements. A reconciliation of these measurements and corresponding GAAP measures is provided in our earnings release and in the appendix of our investor presentation. A replay of the conference call and transcript will be archived on the company's investor relations website shortly following the call. The replay will be available until November sixth, twenty twenty-four. Now, I'd like to turn the call over to Frank Bozich. Thanks, Andy, and welcome to our Q3 2023 earnings call. I'd like to start with a discussion of our Q3 results. As expected, our Q3 sales volume was roughly flat to Q2 and consistent with the lower demand level we've seen over the past year. This reflects lower end customer demand, particularly in consumer durables and building and construction, continued customer destocking, as well as weaker market demand in Asia, leading to higher exports to Europe. However, looking at our customers, we feel we are seeing a slowing of destocking and are hopeful this will end in the near future, depending on the value chain. Despite this prolonged period of reduced demand, we've taken numerous asset footprint and other cost reduction actions to improve our profitability. Late last year, we announced the closures of our styrene plant in Böhlen, Germany, and half of our polycarbonate production in Stade, Germany, along with consolidating our PMMA sheet production in North America. This year, we've seen significant profitability and free cash flow improvements from these actions. I would like to refer to the additional actions we've recently announced, which are highlighted on slide 4 of our investor deck. First, the closure of our Terneuzen, in the Netherlands, styrene plant. Second, the optimization of our PMMA sheet network in Europe, including plant consolidations. And lastly, corporate cost reductions, including the elimination of certain executive positions. In aggregate, these recent actions are expected to result in approximately $75 million of annual cost reductions that we expect to be realized in 2024. We believe these actions will not only increase our profitability and cash generation, but will also enable us to continue investing in transformation projects such as recycling and material substitution innovations, which offer significant growth potential even in the current market environment. While market demand has remained challenging for the entire industry, we continue to see the benefit of the shift in our portfolio to one that is more specialty and sustainability solutions-oriented. In 2023, specialty and sustainable solutions comprise about 30% of our variable margin, and this is about double the level of 2020. This part of our portfolio has shown better margin resiliency in the current environment. Continued focus on growing these technologies and also taking decisive action on our more cost-sensitive assets gives us additional levers to improve profit while market demand remains depressed. Looking at Q3 profitability, we reported a net loss from continuing operations of $38 million and an Adjusted EBITDA of $41 million. This result was below our expectations, due mainly to the styrene-related impacts during the quarter, including a short-term spike in European styrene prices while we were buying all of our styrene on the spot market during the unplanned outage at Terneuzen. However, I'm proud to say that due to our continued focus on Working Capital, we were able to generate positive Free Cash Flow for the third consecutive quarter. In addition, as previously announced, we've successfully refinanced all of our 2024 term loan and over 75% of our 2025 notes. Going back to the Terneuzen styrene closure, I want to be clear that we did not take the closure of this plant lightly. But styrene profitability has been negative for the last nine quarters. With elevated energy prices in Europe, styrene production cost in the region is one of the highest in the world. Plus, given recent and planned global styrene capacity additions, we believe this feedstock will remain structurally long through the end of the decade. Therefore, we believe we'll be able to purchase styrene at lower prices than our production costs. The positive result of our previously announced Böhlen closure supports this as the correct course of action. This closure also reduces production risk, ongoing capital and turnaround costs, while lowering our energy intensity and carbon footprint. With the closure of Terneuzen styrene, we will no longer produce styrene anywhere in the world. We will therefore purchase all of our styrene needs from third parties. We have always purchased all of our styrene needs in North America and Asia, as well as a significant percentage of our European requirements, so this model is not new to us. We plan to buy via diversified geographic and commercial arrangements, providing us with flexibility to optimize our purchases. Starting in Q1 of 2024, we will no longer have a feedstocks reporting segment, and the actual purchase cost of styrene will flow through to the derivative segments: polystyrene, plastic solutions, and latex binders. These businesses pass through styrene costs in their product prices, either through market mechanisms or via price formulas. Because we will be buying all of our styrene and generally operate with pass-through economics in our downstream businesses, we don't expect to see the volatility of styrene margins in our results. Before I hand the call over to Dave, I'd like to talk to you about our progress and sustainability. This continues to be a bright spot, and our sales volume for recycled content-containing products was up 10% year to date from our continued focus in this very important area. On this topic, I'd like to provide more details on one of our sustainability projects that I'm particularly excited about. Earlier this year, we announced the inauguration of our polycarbonate dissolution pilot facility in Terneuzen in the Netherlands. Since that announcement, I'm happy to report that the pilot facility is operational, has been qualifying mixed waste streams, and producing samples of recycled polycarbonate for our customers. Through this ongoing investment and our ability to repurpose the idle polycarbonate production line in Stade, Germany, for this process, we expect to be able to achieve industrial-scale production beginning in 2025 with a low capital expenditure. Now, I'd like to highlight some of the unique features of our technology and the advantages it will provide in the future. Our process uses our proprietary advanced physical recycling technology that enables the recovery of polycarbonate polymer from end-of-life plastics, such as automotive parts and consumer electronics, that are difficult to recycle via traditional mechanical recycling methods. Our technology allows us to extract polycarbonate polymer from a mixed waste stream, meaning polycarbonate containing mixed waste, waste mixed with other plastic, metal, or glass, giving us the ability to process waste that would otherwise be unrecyclable. As a result, certain waste that could only be sent to a landfill or an incinerator in the past can be recovered and recycled using our technology. This will enable closed loop partnerships with automotive, electronics, and consumer goods customers that currently produce end-of-life plastics. These partnerships are highly attractive to our customers as they provide circular solutions. In addition to the sustainability advantages of our technology, the quality of polycarbonate that we extract through the dissolution process is on par with virgin PC and contains lower levels of residual Bisphenol A. These reduced BPA levels could potentially expand the types of applications for which recycled PC is approved. Our process also emits up to three times less CO2 than virgin PC production, making both the process and end products more sustainable. Finally, because this technology permits the use of lower value waste and feedstock, as feedstock, we anticipate at scale it will result in cost savings compared to virgin PC production. I'd like to thank our research and development team for their truly innovative work and their dedication toward creating a cleaner, more circular polycarbonate technology. This is just one of the many exciting projects that we continue to focus on in order to achieve our 2030 sustainability and growth goals and continue to increase the mix of specialties in our portfolio. Now, I'd like to turn the call over to Dave. Thank you, Frank. Our Q3 Adjusted EBITDA was below our expectations, due mainly to lower styrene-related margin from our unplanned outage at Terneuzen, as well as negative Net Timing from decreasing raw materials. Results included unfavorable impacts of $15 million related to the Terneuzen styrene outage, $11 million from natural gas hedge losses, and $4 million from Net Timing. Please note that the $11 million impact from natural gas hedges has decreased from $19 million in Q1 and $12 million in Q2. We expect this impact to be about $5 million in Q4 and about $5 million overall in 2024. In Q2, we had Free Cash Flow of $16 million, including a Working Capital reduction of $52 million, which was driven by continued cash initiatives. Year to date, we have reduced Working Capital by over $150 million, and over 80% of this reduction is from lower working capital days as opposed to price. We are comfortable operating at this reduced level of Working Capital as long as this demand environment persists. We ended Q3 with $279 million of cash and $495 million of liquidity, including our undrawn bank facilities. The last item I'd like to discuss is our recent refinancing. As slide 13 in our deck shows, we refinanced $660 million of the 2024 term loan and $385 million of the 2025 senior notes, extending these maturities to 2028. This leaves $115 million of notes due in September 2025, and no other maturities until 2028. Now I'll turn the call back over to Frank, who will talk about our expectations for the remainder of 2023. Thanks, Dave. Looking at our forecast for the rest of the year, we're guiding to a full year net loss of $509 million-$499 million, and adjusted EBITDA of $175 million-$185 million. This updated full year adjusted EBITDA outlook is below our prior guidance, primarily from lower styrene-related margin and unfavorable net timing in Q3, as well as a more pronounced year-end seasonality impact in Q4. As we continue to navigate a sustained low demand environment, we've been proactive by taking significant action to enhance profitability and cash generation, including numerous initiatives regarding asset optimization, cost reductions, and liquidity improvements. The year-over-year benefit of these actions, combined with lower losses from natural gas hedges, are expected to result in over $100 million of EBITDA improvement. In addition to these improvements, the 2023 Adjusted EBITDA outlook includes Q3 year-to-date unfavorable impacts of $22 million from Net Timing from declining raw materials and $14 million from fixed cost underabsorption related to our inventory reduction actions. Therefore, we expect these tailwinds to result in significantly higher profitability in 2024. Now we're happy to take your questions. Thank you, Mr. Bozich. Ladies and gentlemen, at this time, if you do have any questions, simply press star one, and if you do find your question has already been addressed, you can remove yourself from the queue by pressing star one again. We'll go first this morning to Frank Mitsch at Fermium Research LLC. Good morning and hey, congrats on the refi. I want to drill a little bit more into the 2024 expectation versus 2023. You outlined a $100 million benefit from the cost actions that you've taken, the plant shutdowns, as well as natural gas hedges. And, you know, so far this year, you had. You mentioned the $14 million underabsorption from running your assets light. Of course, you also had another $15 million of unplanned outage. If I add this up, you know, that $100 million, you know, that you're expecting something like $40 million less in terms of nat gas hedges impact, so that implies $60 million of benefit from the restructuring actions. I believe you've previously said you expected, like, $70 million-$90 million of benefit from the restructuring actions. Are we just rounding here? You know, can you talk a little bit more about the bridge from 2023 to 2024, from some of these various noise items? Yeah, Frank, I think the best way to look at it is to look at, you know, slide 4 of the presentation deck, where we talk about the tailwinds. There's a little call-out box there that shows, you know, $100 million related to the asset and cost restructuring and natural gas hedges, the $22 million of unfavorable net timing, plus $14 million of fixed cost underabsorption. So I would say those are the tailwinds that we would go into next year with the benefit of. And, you know, again, I think Q2, Q3 are representative of the demand levels that we would expect to see in this environment as we bounce along at these levels. So a normalized Q3 plus those is probably a good way to think about it in this environment. Gotcha, gotcha. You previously indicated like $70 million-$90 million, just based on the restructuring actions from the plant shutdowns, et cetera. It looks like that $100 million includes that, as well as the $40 million benefit from the natural gas. You're not implying that that you're expecting the benefits to be less than that $70 million-$90 million that you've previously said, are you? ... No, Frank, this is Dave. No, the savings from the restructuring actions, you're right, 70-90 is the original range we gave, and the amount is 75. So what we expect today to get out of that is $75 million. So the 100 that Frank was referring to was in the slide, so is the sum of that 75 plus the natural gas savings. [crosstalk] Frank, we're getting some partial benefit from some of these actions this year. Right. Right. Okay. All right, so year-over-year- So, you know, you can't just- Yeah. There's a portion of it that we're getting... You know, for example, the corporate restructuring actions, those were in effect late in Q3. And, you know, so a portion of those we're gonna get- we've already gotten, so we'll only get the year-over-year benefit as a tailwind next year, and that's what we've highlighted in that tail- that call-out box. All right, very helpful. Then lastly, you mentioned that you're seeing a slowing of destocking, and I was wondering if you might be able to provide some color in terms of the end markets where you might be seeing that, whether that be building and construction, you know, specialty paper packaging or whatever. Any, any color there on where you're seeing the slowing? So in consumer electronics, we're seeing slowing. We're seeing some slowing in the CASE applications in latex binders, as well as in the well, automotive has been very steady, so that supply chain has been pretty resilient. I'd say and also we've seen a slowing in the white goods or consumer goods areas, you know, related to appliances. Where we still see, you know, some destocking, probably the most pronounced destocking that's still ongoing is in kitchen and bath-type applications for our various technologies. You know- Terrific ... in building and construction. Gotcha, gotcha. All right. Thank you so much. Thanks, Frank. Thank you. We'll go next now to David Begleiter at Deutsche Bank. Thank you. Good morning. Frank, do you have an update on the Styrenics sale? So, David, no real update. We continue to field questions from parties that are interested, but nothing is imminent. Understood. And Dave, just on working capital, when volumes do come back to more normalized levels, how much rebuild do you think you'll need in working capital? Well, Dave, as I said in the prepared remarks, over 80% of the reduction this year is from days, so days of working capital that we've taken out, and we've taken that out through... You know, and we believe substantially all that is structural. We've taken out those days of working capital because of the systems and processes that we've implemented, specifically around S&OP and in our new ERP system. So I think, look, you know, price out of that is probably 15% or less. I think when prices do rise, that will likely be indicative of a recovering environment, so we probably see higher EBITDA in that as well. But, you know, the vast majority of it, the remainder is, you know, is days of inventory and days of, you know, other Working Capital that we think we've structurally taken out, and don't think we ever need to add back. Thank you. Thank you. We'll go next now to Matthew Blair at TPH. Hey, good morning, Frank and Dave. I was hoping you could help us out a little bit on the EBITDA bridge from Q3 to Q4. I think midpoint EBITDA guidance only has Q4 moving up, you know, maybe about $5 million quarter-over-quarter. It seems like you would have some pretty considerable tailwinds from rolling off the feedstocks impact in Q3, $19 million, as well as it sounds like, the net gas headwind is effectively going to be about a $6 million tailwind. So is that the right way to think about it? And I guess the delta would be the increased seasonality as well as the benzene hit on the styrene margins? Yeah, I think that that's a way, a good way to think about it. You know, we'll have some benefit, as we outlined from styrene and from the actions we've taken, and those will be somewhat muted in the results because of the... You know, we expect extended customer shutdowns during the year-end. Matthew, just one other point. Look, Frank mentioned in his prepared remarks, but I think it's important that everybody understands. You know, you mentioned benzene, right? And benzene, the higher benzene putting some pressure on styrene margins, and that is in fact happening. Now, in Q3, or excuse me, Q4 we're seeing that in AmSty. You know, AmSty is gonna have a lower performance in Q4 due to styrene margins. But because we're no longer a styrene producer, you know, higher benzene and styrene margins do not impact our results like they used to. So I know that's gonna take some getting used to for us. But, you know, styrene margins really only affect us now in AmSty, not in our own results. Maybe- Okay, let- ... just to add one more point. Sorry, go ahead. I'll go ahead with my question. Please go ahead, Frank. No, the other thing I just do want to point out is that, the styrene contracts that we've negotiated begin in January of next year. We've secured the needs we have for the remainder of the year, largely through spot purchases on the market. So, the timing for the benefit of the contracts to kick in is January of next year. Got it. And then will that still be around for Q4? Will that be a zero, or will there still be some residual, like negative EBITDA flowing through for feedstocks in Q4? It will be there in Q4, Matthew. We will still have a styrene reporting segment. It's not gonna reflect, you know—it's not gonna reflect the production of styrene and internal sales to our internal businesses. It'll just reflect, you know, purchases of styrene that we make and internal transfers of that. Yeah, so I wouldn't—I don't expect it to be negative because of that. I don't expect it to be a negative number in Q4. Got it. Then last question is, I believe the cash flow statement reflected $15 million or $16 million in Q3 from proceeds from the sale of business and other assets. What... Can you remind us what that was for? It was kind of small, immaterial sales of assets. It wasn't a business. It's kind of a miscellaneous assets that it's not even worth the time on the call. Okay. Sounds good. Thank you. Thank you. We go next now to Michael Leithead at Barclays. Great, thanks. Good morning, guys. First, Frank, can you just speak to the intensity of lower-cost Asian imports across your portfolio? Is it getting better or worse relative to maybe earlier this year? Yeah, I would say it's getting better, and that's because the cost differential between European production and Asian cost has decreased, but there's still a pronounced pressure due to the lack of capacity or the free capacity and underutilization of assets in Asia. So there's still pressure from imports, and there still is a dislocation in cost between Europe and Asia. I would say it's most pronounced in plastic solutions and in EM. And due to the nature of, you know, our latex binders business being a water-based product, it's least pronounced, you know, or most non-existent there. Great, that's super helpful. And then, Dave, after the recent refinancing, can you help us with what your current run rate annual cash interest is? Yeah, it's $235 million a year, Mike. Great. Thank you. Thank you. We'll go next now to Hassan Ahmed at Alembic Global Advisors. Morning, Frank and Dave. You know, guys, wanted to revisit some of the moving parts associated with, you know, the initial 2024 sort of guidance or bridge analysis you guys have given. Frank, you mentioned, you know, a good way to think about sort of run rate quarterly EBITDA is Q3 2023 levels, right? So I annualize that, and I come up with, you know, call it $164 million in EBITDA. Then you talked about, you know, the sort of non-presence of the unfavorable timing impacts in 2023, which is another $22 million, and fixed costs under absorption, which is another $14 million. So, you know, you sum it up, and you come to at least $274 million-$275 million in 2024 EBITDA. Am I right in assuming, first of all, that that is the correct way of thinking about it? And of course, that does not factor in any sort of demand improvements, and it doesn't factor in potentially the benefit from the new styrene contract. Am I, am I thinking about this the right way? So I guess, let me play back to you how I would think about it, or I've been thinking about it, and I think, you know, how we discussed it earlier with when Frank asked the question. So if we take $41 million for Q3 and add back the $4 million timing, plus the negative impact from the styrene outage of $15 million, that gets us to about a $60 million dollar run performance, underlying performance in Q3. And from that, we have an additional tailwind of $100 million related to restructuring and natural gas hedges. So, you know, that's how I would think about it. You know, again, this, we're not guiding yet. We'll guide in February, but, you know, sitting here today, that's how I would think about next year. ... Fair enough. Fair enough. And just, again, trying to sort of understand, the demand side of things, you know, with, with, with this massive, destocking that we've seen. You know, back, back, I believe it was Q4 of 2022, during the earnings call, you talked about how historically, you know, destockings lasted two quarters, and the restock post those two sort of quarters of destocking, you know, historically had been quite impressive. Now, here we are, several quarters later, with the destocking continuing. So I mean, should we expect after this level of destocking, as and when it happens, an equally impressive restocking? You know, we talked about this, and I don't know what to expect going forward, to be honest with you. Because I think that the chemical industry, in general, is at an inflection point that in my 40 years I've not seen before, with overcapacities in Asia, geopolitical effects, dislocations in cost. So it's hard for me to say what to expect going forward. Based on history, I would, you know, based on our prior experience, if history would repeat itself, we would say yes, but I'm not again, sitting here today, it's difficult to predict when and how that will happen, or what it will look like. Fair enough. Very helpful, Frank. Thank you so much. Thank you. We go next now to Laurence Alexander at Jefferies. Good morning. Could you unpack the comments around extended shutdowns? Is that just in kind of the appliance industry, or are you also seeing that in automotive? And are you thinking about it in terms of shutdowns starting earlier than normal, or are you also concerned about them spilling over into January more than usual? No, we think that the customers will be reworking, managing working capital by reducing stocks through the year-end, and so their shutdowns will start earlier. I would say this is across, probably across the value chains. You know, and again- And- ... if there's an exception, it's probably automotive. And secondly, just in terms of the kind of the comp effects, you know, if you take kind of the way your customers talked about their sense of underlying demand, you know, is there at least a high confidence in, level of confidence that volumes are positive comparisons in Q2 year-over-year? Or are customers more nervous on the visibility at this point? I just want to make sure I understand. So I just want to make sure I understand compared, positive volume compared to Q2? Should—When we think about the year-over-year cadence on volumes, should you be back in positive territory by Q2 of next year based on what your customers are saying, or are they indicating too much uncertainty on demand trends? Just trying to think about the last thing in the stock cycle. Yes. So I would say, in general, we would see low single-digit demand improvement, is the signal we're getting across the portfolio. You know, so some improvement, but not, as Hassan asks, a recovery. You know, so low single-digit demand improvement, and it varies by specific segment when that'll kick in. But that's how I would think about it and how we're thinking about it right now. And then just lastly, on the recycled polycarbonate. You made a comment, if I heard properly, that it will actually be cheaper than virgin polycarbonate. Do you have a sense? Is there a kind of structural gap, you know, like a rule of thumb as to just how much of an advantage you should have? And do your customers expect you to sort of split that with them so that they get a cheaper product, or are they telling you that they would be willing to pay a premium, like we see in other plastics, and then you just get a healthier margin? Well, I would say in general, we enjoy a premium in the recycled product based on the significant demand in many of our value chains for that type of product, you know, for helping our customers achieve their recycling and circularity goals. So I would expect to get a healthy return on these technologies as we market those and back to our customers. From a cost standpoint, it will all depend on what feed we begin with. And I think what we tried to explain and what's unique about our technology is, we can take a mixed stream that would contain colors, other types of materials like metal, glass, or other plastics, and we can extract the polycarbonate polymer from that and get to an almost purified, virgin-quality polycarbonate. So depending on, you know, the cost to get, secure that feedstock, which, it... You know, in mixed waste, these are largely very inexpensive or previously been landfilled, we would expect to get a lower- be able to produce, at scale, a lower cost than virgin. I don't know if that helps. You know, it's difficult to quantify because it'll all depend on what partnership we have with our end customer, and, and let me give you an example. So we could take headlamps that are waste, you know, scrap by our customer. You know, might be end of life or could be, you know, low quality or offgrade from their production, and we can recycle it and return that material to them. So same thing: we think about an interior door panel from a car company. We actually have taken byproduct or scrap door panels from our existing customers and recycled it and made, delivered back to them the polycarbonate that we've recycled, and they've made virgin door panels, and they meet their their quality requirements. So it's a. We've done the same thing in consumer electronics. So, you know, we've yet to see the full potential of it, but we're very excited about it, and early indications are that we have a significant demand from our customer base, and, they're excited about partnering with us. Thank you. Ladies and gentlemen, that will conclude our question and answer session this morning, and it will bring us to the end of this morning's conference call. Again, we'd like to thank you all so much for joining the Trinseo Third Quarter 2023 Financial Results Conference Call, and wish you all a great day. Goodbye.