Good morning everyone. Jeff Elliott with Three Part Advisors. Welcome everyone to the kickoff of the Midwest Ideas Conference. Happy to have everyone here. Our first presenting company of the day is UFP Technologies. UFP is the ticker. They're based in Newburyport, Massachusetts. With us today from the company, we have Mitchell Rock, the President. Happy to have him here for the first time meeting investors today. We have Ron Lataille, the CFO. UFPT is a client of ours for many years. If anybody would like a follow-up or a meeting, please reach out to me directly. Happy to help set that up. With that, I'll just turn it over to Mitch. Thank you Jeff. Welcome everyone. I'm Mitchell Rock. I'm the President of UFP Technologies. Thank you for showing up early today. I want to share UFP Technologies as a new idea for you. Forward-looking statement. You guys have all seen this before. Risk involved. Over the next few slides, I want to describe who we are, and I want to do that through a story. I know it's a little small, but you all can see here, there's a guy named Henry. Henry's from Ireland, and a few years ago, he was feeling dizzy, fell to the ground, 911 call, goes to the hospital, gets a scan. He's got a blood clot in his brain. He's having a stroke. There is a procedure with a neurovascular device that goes through his arterial system up into his brain, pulls the clot out, and he walks out of the hospital that exact same day. This is Henry with his wife at our factory in Galway Ireland. UFP Technologies developed that device with our client about 15 years ago, and we assemble that today, and it saved his life. This is what UFP Technologies does. We help make innovative devices that improve patient outcomes or improve outcomes, and we do this for many companies. We actually do business with 26 of the top 30 medical device companies globally. The company is based in Newburyport Massachusetts. It's got a close to $2 billion market cap. It's got $600 million in revenue. About $550 million of that is medical revenue. We've got 22 locations, about 4,000 team members across the globe, and we've got six development labs. These development labs are important. You'll hear a little bit more about it because it really is the D in our business model of CDMO, a Contract Development and Manufacturing Organization. That development is important to our clients because our clients are trying to develop new devices that improve patients' lives just like we did for Henry. This is really rooted in our design engineering of special materials where we develop special processes, and then we manufacture those at scale. We have a proven process, and the key to this really is our product development business. We engage with our clients early in the development of a new device. Our clients are trying to innovate to improve patient outcomes at a better overall cost. We've got about six key technologies where we have a product development business, and this really is a self-funding business that has a lot of benefits. It's high margin. We get early engagements with our clients, so we build customer intimacy. Ultimately, our clients tell us, "We need to be able to launch this product at this cost to deliver this value proposition," and we can build a custom manufacturing process so that they can get the appropriate margins and we can get the appropriate margins. I'm going to walk you through some of the examples of this at work. In all six of these cases, you're going to have a growing segment, medical device segment, with a market-leading client with a differentiated technology that UFP Technologies has agency in, where we've developed some kind of a custom manufacturing process, and then we've scaled it. I'm going to start with the one in the bottom center. This is negative pressure wound therapy. It tells a little bit about the story of UFP. For years, we made that purple part. We die-cut a piece of foam. There's a filter foam that makes negative pressure work. If you don't know anything about it, it's basically a wound healing process where you apply a vacuum. We would sell a $0.50 part to a company literally in our same state that was selling a $20 part to the market leader. Ultimately, in 2018, we came together with that business. Now we are way more valuable to our clients, and this is a key part of our investment thesis. We don't only want to sell a component. We want to sell the full assembly. We did the same exact thing in the robotic surgery space. In the upper, I think that's your upper, in the upper corner of robotic drapes. We've been doing business in this space since the mid-2000s. We had key technology where we would precision mold basically a specialty glove, which is the interface between the robot and the instrumentation. It has to be precise. We made these for years. We made it on the first-generation robot. We made it on the second-generation robot. Ultimately, again, we wanted to be more valuable to our clients. We came together with DAS Medical in 2021 to make the full drape. You'll hear more about this in the next few slides. The centerpiece is the center part is the neurovascular device that saved Henry's life. In the other upper right corner is an access port cleaner. Hospital-acquired infections, each year, there's about 1.7 million of them. It kills about 100,000 people. The primary causes are urinary tract infections, surgical site infection, and bloodstream infections. UFP is partnered with leaders in each one of these categories. That part there is a site access cleaner, and it's done with a specialty foam. You can only get that foam in one place. It's from us. We built a custom piece of equipment to make a brush. You can't really see the features there, but it's like a little brush that cleans that port. We built custom equipment for it. It was a startup. It was bought by Bard, then by BD, and we've been doing that part for about 15 years. Really, really nice part, nice margins. The last two go together in the bottom two corners. The med surge product there is an ICU bed. We make a cover for that bed. The why behind that is, again, infection prevention. ICU beds used to have a lot of sewing, a lot of stitching. To clean those beds was difficult, so it caused infection. Our client wanted to build a cover that was all film with a seal that can't fail. You had to basically seal weld a complex ICU bed. We did that with our dielectrics business. That same exact client has a patient transfer business. The client is Stryker. After a few years, we kept trying to develop a new design of RF welding. Ultimately, you can't. Ultimately, we developed a, we bought AJR in Chicago in 2024. Now we have both the ICU bed and then the patient transfer business. Let's move on to the overall opportunity, and it's an exciting opportunity. The med- tech market is half a trillion dollars. It's growing at 6.3%. More importantly, these clients are starting to outsource more. They're starting to outsource both innovation and manufacturing. They want to allocate capital to developing new widgets that have better outcomes. The outsourcing market is now close to $100 billion, and it's grown at 10% or 11%. UFP is focused on areas where single use, plastic-based. The way I like to think about it is think of kind of low average selling price, but high risk of failure. The part can't fail. Our business is segmented into medical device, robotic surgical drapes, and then we have a specialty packaging business, which is mainly orthopedic implants and interventional catheters. We've segmented the business for you further. There's about 20 plus defined segments in the medical space. We've got eight. We service eight of those segments where we have $15 million in revenue or more. There's still a huge amount of opportunity, both in terms of adding segments and growth within the existing segments. Our two largest ones, if you know the story of UFP Technologies, are robotic surgery and patient services, and they're both growing nicely. Here's a story around adding more value to the client. We talked about robotic surgical drapes earlier. We talked about that specialty glove that interfaces with the robot and the instrumentation. We added DAS Medical to be able to assemble the drape in a low-cost country in the Dominican Republic because, again, it's kind of low sales price, high risk of failure. Every one of these drapes also has an injection-molded piece. It's got adhesive. It needs specialty sealing. We added Marble Medical, where we bought adhesive from. We just bought an injection molder in Puerto Rico called Techno Plastics Industries, or TPI. Think of it as a string of pearls around a valuable segment or a valuable client, just being more valuable to them. Our growth strategy is simple, two-pronged: organic growth, focused on what we're good at, and strategic acquisitions. On the organic growth side, we focus on faster growing segments or niches in the market. Think robotic surgery, think patient handling. We focus on technologies that are differentiated, that our clients are likely going to outsource, and then we continue to build value around them. We look for add-on technologies. We look for add-on geographies. It's important for us that there's a cultural fit. On the acquisition side, same thesis, becoming more valuable to our clients. Those focus on new capabilities, adding scale, and looking for synergies. Our goal for acquisitions is to be accretive within the first year. The management team at UFP Technologies has been together for a long time. We've done 22 deals. Since 2021, we've done nine deals, all in the med tech- space. This really illustrates, I call it customer-centric M&A, where it's growing segments, differentiated tech. Again, back to that thesis of being valuable to our clients to innovate, to get better patient outcomes. We're always thinking about that customer. Since 2021, our medical revenue was $132 million, trailing $12 million. Now Now it's $540 million. That's kind of 40% CAGR when you look at the acquisitions. We recently did a couple of add-ons, TPI in Puerto Rico and then UNIPEC in Maryland, which was basically the same business as the business we bought last year, Welch. Those two businesses come together. Those of you that know the story, it's similar to what we did with Contact and Advent, two kind of competitors that do the same thing. Why invest? There is a significant market opportunity, particularly around outsourcing and development. Our clients are outsourcing more. They're outsourcing innovation more. They're looking at things that have relatively low risk for them that aren't core, they want to outsource. It is a regulated space. There is barrier to entry in terms of regulation. We have the FDA. We've got parallel structures inside of our clients, the quality guys. Even if you wanted to switch something, it takes a very long time, and you have to give them a reason why. UFP innovates, and we take costs out. We build these strong customer relationships so they don't want to switch. We have an experienced management team with a proven growth strategy. It's working. We've got the outcomes as well. Significant market growth opportunities we've heard about. We are focused on better patient outcomes. Things that you have not heard about, and I know there's a lot of words here. I almost don't look at the words on the page that I want to leave you with. If you look under the hood of UFP Technologies, the real differentiator that maybe you didn't hear is we have 100 plus engineers. These engineers deliver technical value to our clients. Our clients engage with them. We have super special supplier relationships. These supplier relationships are unique. We treat our suppliers like our clients. For that, we get preferential treatment, preferred access, exclusive access, etc. When you get scale with suppliers, it's a significant competitive advantage with your client as well. The strategy is working. We'll move on to financial targets. We provide three to five-year financial targets, revenue growth of 12%- 18%, basically doubling the company every five years, gross margins of 28%- 31%, adjusted operating margin of 17%- 20%. You can see with internal growth plus the acquisitions, we've obviously exceeded the targets over the last few years. On the gross margin side, over the last few years, we're in our range. It's operating leverage from mix shift plus acquisition synergies and efficiencies. The same is true with the operating margin. I want to leave you guys with this idea. UFP Technologies is in the early innings of the medical device contract development outsourcing game. It's a $100 billion market. Our clients are innovating to deliver better outcomes. They're constantly trying to replace devices that they already do. Many of these are disposable. Many of these are polymer plastic-based, right in our sweet spot. Our strategy is working. We have less than 1% share of the overall market. We're focused on growing segments. We're intimate with large clients that are winning in these segments. We have differentiated technologies. We have a proven team. It's working. That's your idea for today. Thank you. I'll take questions. Mitchell, who else is doing this? I mean, it's a big opportunity that must be there. Super fragmented. You know, just to give you a stat, there's 900 private equity-backed what you would classify as CDMOs. It's super fragmented. Lots of small folks. It's partially because it's a super regulated market. It's hard to switch things. Sure. Can you talk a little bit about the customer penetration and the recent [guess]? Yeah, so it's something we think about. Those that know the story, we have Intuitive Surgical is a large client, about $150 million. Stryker is now a large client, about $150 million. We have leaned into those relationships frankly, because we believe that we're positioned to grow with them. We'll continue to try to diversify the portfolio within those clients and within those segments. You'll have acquisitions, yeah, both from private clients? Both. Sometimes you acquire. In the case of Intuitive Surgical, as you can see, we acquired DAS Medical. We also acquired small companies that have some Intuitive Surgical spend, and we diversified the portfolio by acquiring AJR. That de-risked customer concentration for the overall business. In terms of all the other surgical robots outside of, you know, Da Vinci, what's the trajectory going in terms of that? You sort of actually kind of how it was first. It's a great question. I wish I knew the exact answer. What I can tell you, and you can do the research, is there's tons of soft tissue platforms out there. Medtronic's got one. J&J's got one. There are ortho platforms, Stryker, Zimmer, DePuy. Everyone is putting risk capital in place to develop some type of a robotic-assisted platform for different types of procedures. We are positioned to do the development work for all of those. They come to us. We have the capabilities. We're in the right spot. We have the reputation. We just don't sell the robots and get the procedures approved. Can you utilize the capacity you have with Intuitive Surgical as well to go after other opportunities? We absolutely are. Since we've owned that business, it's more than tripled. We've added buildings that are dedicated to other clients, and we've added a development lab that is exclusively focused on developing and launching new drapes. How many employees do you have now in the In our DAS operations, it's 2,000 plus. We also have the AJR operation, which is in the north side of the country, which is about 500 now. Can you talk about the balance sheet and the acquisition? I think I have the numbers right. I think right now we're levered at about 1.5 times. We've got plenty of capacity. We're actively looking at a number of deals. We're constantly active. Every deal that's in the market comes across our desk. Sure. How do you, in the end, though, if you're doing outsourcing for your products, innovation, etc., to companies that your clients are actually going to become competing, how do you manage those relationships so that people don't feel? It's very manageable. In some cases, we can build a separate building. In some cases, we can build a separate room. It's all covered by NDAs. Our clients are well aware when we have expertise in a certain application or material that we will be doing that for others that are in the market. Sorry? Mexico, you just. Yeah, we have 83,000 square feet in TJ, yes. It's for us, it's a pass-through to our clients. No impact. It's also tariff-free, right? USMCA, that's right. Right. Our clients will manage that. We are a contract manufacturer to our clients. Sure. Also, the recent acquisitions, is this now a structurally lower margin? I would say that we announced in the second quarter that we had some headwinds with regard to onboarding new employees in our AJR business. I would just say it's a one-time thing that we will also see in the second quarter. Your position hasn't started. There's a lot of comment on that at all. I wouldn't bet against UFP Technologies. I think a lot of what is cited in that short report is factually incorrect. I'm probably as intimate with that client as anyone in our business. Yeah, the authors of those short reports have never had a conversation on management at all. Sure. Can you discuss the 12% into the low revenue guidance and the acquisition margins? How do you see that's developing? How is that affecting? I think over time, we've exceeded those targets. Recently, I think the organic growth is in the mid-single digits. I think we will still be able to kind of meet our targets. I went to a wedding. Jeff and I have worked together for a long time, so we've got a great working relationship. Any other questions? All right. Sure. By the way, if you come up against a 10-tier brief for acquisitions, you indicate that the goodwill will be deductible for tax purposes. Can you give me a sort of color on that? Ron, you want to take that one? The deals, even though they're stock deals, are structured for tax purposes as an asset. They also are an asset. The deal in the tax law, you're doing well, you step up the basis. It's tax deductible. All right, thank you.