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Luxfer (LXFR)

Participants
Alok Maskara Chief Executive Officer
Heather Harding Chief Financial Officer
Chris Moore CJS Securities
Craig Irwin ROTH Capital Partners
Sarkis Sherbetchyan B. Riley Securities
Phil Gibbs KeyBanc Capital Markets
Call transcript
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Operator

Good morning. My name is Laurie, and I will be your conference operator today. Welcome to Luxfer's 2021 First Quarter Earnings Conference Call. All lines have been placed on mute. After the speakers' remarks, there will be a question-and-answer session.

the to turn from will I call Heather over Luxfer. Now, go ahead. please Heather,

Heather Harding

Thank quarter Luxfer's to you, Welcome Laurie. first XXXX call. earnings

the by accompanied Heather happy Maskara, Alok are Officer. is today. Officer, can non-GAAP Please are the based Today's as to operation you with of been Harding, that of press provide a am and all Financial any yesterday. reconciled note Luxfer's we in today guideline. forming webcast accounting Luxfer's today's results Chief performance Also on quarter the We our presentation. details aluminum Appendix have XXXX luxfer.com. classified presentation release me press Chief businesses at as on accessed call, issued with be first have On release exclude that and I is the us references discontinued will all financials Executive to outlined in this our presentation numbers in and

a any to today's the subject further statement before and for refer to Please friendly are Now Slide X uncertainties. on reminder future results details. made begin, forward-looking about Safe Company's financial that presentation we risks expected the of statements Harbor

to the turn let Now, me Alok. call over

Alok Maskara

our to want Covid-XX pandemic. XXXX. maintaining Thanks our on first with serving and as quarter navigate in strong the the Thanks, steadfast we protocols leaders we cash of welcome employees, margins everyone. and of customers adherence their to continued Heather, and hard I my of while for delivered appreciation start flow employees focus to record work safety the

the during key begin by me Let three developments highlighting quarter.

in sales into conversion despite past EBITDA in eight EBITDA QX net cash the debt of lowest of margin years. these First, pandemic's of more earnings, earnings level solid the than X.X, and we ratio to the a resulted strong XX% impact, negative delivered

meaningfully and to fuel alternative our we as hydrogen in applications CNG such by industries acquiring composite increase our structural aerospace storage. upgraded portfolio Second, presence and

alternative now of fuel Luxfer's SCI addition the makes total XX% revenues. of With up

a our in $XX in goal in transformation savings, achieved delivering cash capital total of cost million schedule by and million reductions. spend we reduction million $X $XX Third, long-term P&L savings, ahead of including

continued also which of our our announced the greater details will before Graham provide financial part of reviews by a discontinued simplify divestiture the completing on plant, these We was in operations. to Harding previously aluminum CFO, portfolio I our performance depth. more Heather themes

Now, please results. a X, slide turn to financial of for our quarter summary first

industrial decreased continued During the sales. as the first quarter, product million $XX.X total of year-over-year, impact negatively X.X% sales our pandemic to

million by adjusted XX%, quarter EBITDA improvements. driven $XX.X increased productivity primarily of First

EPS the was an Our adjusted of from increase diluted $X.XX year. quarter, for the prior XX%

debt the months. end QX net to year. $XX shareholders to in million of during last returned enabled compared working $XX.X $XX our flow Our as improvements, flow to was cash generated free $X lean $XX.X or million. debt reversal of net dividends, of This to driven This of million million cash strong addition from we million past QX the capital of at outflow was the XXXX by to XX the we reduce cash us reduction

X.Xx end mentioned debt net quarter. the improved of As ratio earlier, our to EBITDA to the at

Our balance with providing flexibility. significant sheet financial and remains strategic strong, us

On cash. for Structural overview for recent or Structural of turn Industries, approximately Industries Composites Luxfer an Worthington X to please $XX our from SCI. acquired in Now slide acquisition, XX, Composite March million

frequently our storage fiber critical founded inflation reputation, specified for and aircrafts applications, vehicles in in and of and and significant compressed the in SCI family cylinders A of applications applications SCI breathing transporting putting gas in performance. given CNG, technology hydrogen history presence transportation and spacecraft. acquisition be include applications. hydrogen Luxfer we XXXX given excited acquisition about XXXX, to remain diluted strong In in criteria, defense are short-term SCI significant composite was earnings Luxfer long value critical accretive Examples compressed to EPS committed storage, losses. we its $X.XX, and and to CIS XXXX proprietary gas, and and all quality will impact the aerospace, these other expect and niche first carbon cylinders mission lightweight is while welcome employees for to be beyond. strategic meets storing the has for shareholders. into by to for and and and We market natural of XXX The customers generate the

and to and We will fuel alternative SCI Type bar long-term products growth profitability. be investing as ensure cylinders our in XXX hydrogen such X,

of to provides SCI slide on fuel will our share addition technology, customer presence of compelling strategic higher alternative and fast from for solutions. SCI growth end high to market. market scale recovery. ongoing market, enable end will the manufacturing presence also a also existing scope benefits and has capability financial been consolidated end base hydrogen SCI has a strengthens for to increased position acquisition given strong are capture X. Luxfer's About aerospace growth the where SCI half market for and outlined presence better with an position. Adding growing which driver this us us Luxfer growth in demand Luxfer's CNG increasing our In benefits, as Luxfer sales

in serve alternative acquisition to critical better our end In will and markets, and and presence end fuel SCI in applications aerospace also niche increasing customers markets. SCBA, allow other addition Luxfer the to

capacity This while manufacturing to location benefits million of composite million is serve synergies. to proximity manufacturing talent largest SCI Luxfer location and cylinder $X this California. better of to Luxfer's Riverside, total optimize share in $X One expertise the generating will enable acquisition in customers of proximity the manufacturing to and

is automotive aluminum and solutions. CNG of makes significant gas acquisition hydrogen SCI margin gas the increased simpler segment our majority sales, XX% and cyclical with due forming of operations, to growth Given portfolio cylinder up lower for the products. our now dependent fuels less on discontinuation Alternatives cylinders potential of and demand passenger

and lines, Alloys, Specialty generating please new to the portfolio, and High consists is three Catalyst, is simplification turn past simplified Composite Pressure products slide innovative significant and a drive high X. improving going customer Luxfer's core Magnesium portfolio simplified focus of to growth greater on overview an service. Cylinders. This compared by performance Luxfer's by Zirconium, For product to of

core growth As our differentiated customers and $XXX in portfolio by was simplification in profitability end XX over in improve value our profile three the revenue multiple niche offer a years, reminder, position million sold projects propositions growth core manufactured to product and and about over consolidation to of The locations markets non applications. and we divestment driven the three lines as product outlook. past in lines higher locations, our

results an portfolio as we Elektron and that commercial include segments, of our for excellence, Growth growth Cylinders of greater growth growth driver. our to positioning, value acquisitions. bolt-on new products, enabled Please factors five to to and Gas continue report productivity. in slide will Luxfer financial is future for overview and two X talent, key turn create We shareholders by

We continue on growth progress make to laying foundation. a solid

ESM through of well revenue Our Metals. growth from profile, changing such recent past mentioned on underperforming profile refresh accomplishments the growth continuing from with increasing Structural over divestment our to three include acquisition the Other to the while new XX% slow bolting as products recent growth innovation, as previously Specialty businesses better while years, Industries, portfolio's of X% Composite project businesses as and accomplishments include pipeline. talent

in growth geographic to opportunities have improvement of products to our fast growth new penetrate plenty from increasing more further portfolio. These include expansion and bolt-on accelerate We regions, completing acquisitions. future revenue

turn plan first saving me quarter to let details and Now, on the call financials. Harding Heather for over our transformation

Heather Harding

everyone to Thanks Alok again. good morning and

slide quarter first the review efforts on will with financial our I Before of a start results, X. summary cost reduction I

future, We P&L to cost are announce $XX savings with total company planned years of fewer very realized completion our fixed in bringing the to well plan. positioned focus component working of than focus and $X more structure, past transformation cost executed the our first for net million. of the manufacturing This on cost pleased a locations, reduction over relentless lower our million has We quarter, actions the savings and the capital. three the

rationalization, reduced of levels In our past years. resulting addition, total capital from historic the savings million $XX cash million in three $X we by over through requirements facility annual

forward, annual $XX delivering with goal aluminum are $XX Going Ongoing requirements between capital our continue the manufacturing, including expect X% be million productivity. of on annually. to million cost we focus to to around manufacturing expected automation projects,

let's by end Now, performance first review on market sales the quarter with a X. financial our at look slide results

automotive the As market sales be by a and First the a which and can Defense, in Industrial. hydrogen recovery for General classified quarter, quarter grew alternative natural relief healthcare significant saw X% response compressed last user increased sales. products gas demand reminder, Sales transportation XX.X% our sales into in key for quarter first versus and we markets. In Transportation, strong first three end defense, the increased Response aerospace combination fuel, of by disaster Healthcare, driven for demand a end same year, products. military in ++is and and the a and first

food also year, recovery, of current in prior auto overall XX.X% to of last the market filtration. timing versus service. end products applications, products aerospace impacted also as the products general catalysts orders in of to products wider the driven experienced Outside to industry orders same QX stocking in We returned packaging single Sales and by of COVID certain be year. was quarter industrial of new year declined Relative our the quarter. and these growth gas impact the largest particulate adoption such industrial the continued period the XXXX. Sales growth by in in in

in and In of negatively addition, impacted by industrial disruptions. supply products shipments XXXX were transportation QX

order industrial recovery improved continued coming about the remain quarter, first optimistic Given during over rate the we the the quarters.

turn P&L XX quarter summary of a Now to first please slide our for results.

in versus quarter EBITDA the markets made for end savings the volume of progress the than in contribution previously delivered by the net in end was due fuel COVID $X.X the strong alternative volume offset great price and first XX% we the year. to communicated key declines. Overall, to more transformation plan. year, the and sales SCI was acquisition quarter adds impact company its $XX.X expanded transportation million $X the sales market decline, in X.X% of prior delivered million driven Consolidated quarter general X.X% prior within within the sales. than industrial with Growth of The as Despite by favorable quarter sales $XX.X adjusted the million we FX cost million improved quarter cash. by trends, market. declined offset profitability more First in

the digit to double declined decline, growth. product X% Despite Cylinders on net million negatively million products, Elektron EBITDA COVID XX. to the COVID lower cost around Now sales sales XX% X.X% with increased from alternative offset impact than slide industrial magnesium was due sales decrease X.X% in posted $XX the on Gas sales decline and let's segment decline, industrial $XX.X look of cost the volume to due at realization million savings to as impact $X results the prior primarily year. The higher segment savings products. strong Despite volume. sales while of the the year quarter. EBITDA the fuel continued was prior

We Now XX. key a quarter cash flow let's our ended and balance balance slide the metrics sheet. first review on sheet stronger with

position XXXX. million point EBITDA to net $XX.X of Our debt lowest improved leading X.Xx, net to ratio since debt our to a levels

capital million XX.X% $XX.X our generation. is free contributor working finished and significant $XX.X was of XX.X% sales, operating a quarter First year's prior which flow a improvement or million key level cash over at to

an targeted to of XX% forward, range capital sales. we've Going XX% operating working

ample SCI our excellent acquisition. approach With we capital our identifying potential further of compelling value. profitable This through slide position, demonstrates allocation our basis, liquidity shareholder are adjusted This generating our flow like On organic growth. identifying going take solid strong XX.X% to positioned drive benefits on ROIC cash strong cash the recent we capital flow. to portfolio, free includes to our financial earnings, cash delivered drive allocation additional steps trailing And amount options we strategically for evaluating well remained to have filters to review free Alok using conversion business inorganic our acquisition XX. and from from and the I'd disciplined candidates. strategic priorities balance and forward. our a reviewed significant XX-month and sheet

capital create As internal to allocation of is which includes and our priority new through product first execution, funding a reminder, innovation talent value development.

expect we restructuring to to For funds transformation cash million outlay, SCI $XX remaining which plan plus the includes in for integration. of year, the million the $XX spend cash, remainder

of to million We million COVID. XXXX, an negatively expenditures expect $X $XX by $XX in million from spend to is that for was which approximately increase spent capital impacted our XXXX

And Next, strategic we shareholders to open supplement remain return organic will cash to acquisitions via our dividends. finally, growth. to we

first the in to in dividend the not shares million of the buyback $X.X a shares $XX out but over maintaining since million intend As we XXXX, repurchase current We including quarter, and year. in paid our remainder first reminder, are dividends quarter have program. this did we

on like Now XX. I'd review slide our XXXX guidance to updated

in guidance be now year Our per impact expect share $X.XX announced approximately year. we now acquisition, to XXXX recent $X.XX. Most earnings for guidance to to this revised $X.XX $X.XX February be was the to includes our $X.XX of the estimate first SCI diluted. importantly, We which

execute $X As to Alok plans will acquisition of million to we XXXX. and synergy our become in accretive earlier, mentioned $X expect million the

We XXXX approximately to revenues a XX% $XX X% to of expect between of favorable X% This $XX revenues benefit, million includes currency full and million. year to grow to range XX%. acquisition

by military grow filtration, sales. in double digits, We SCI driven the acquisition. such products expect the mid hydrogen, in single new by on expected and fuel strong alternative part digits are gas to defense, products, products and first to as particulate MRE Transportation including based response and grow healthcare

expect industrial single in products to recovery. for grow the year to digits We mid due the ongoing full

We execution this initiatives our ability navigate will free recovery be to the positioned flow and cash growth. restructuring. in year on the well continue full excluding confident to conversion capture successfully year cash remain our targeting We for XXX% through management

to Now I'll back Alok a turn over the up. wrap call for

Alok Maskara

Thank you, Heather.

lightweighting. years. conclude a shaping future three XX. mega slide lifestyle that clean trends been has believe clean and for reviewing for me emissions. will our demand a environment on growth by global and driven by including portfolio more continue this We The trends growth Luxfer's growth historic safe many shaping trend lightweighting, Luxfer's are healthy Let the

of Our play a industrial the weight magnesium role and performance, reducing high temperature alloys critical aerospace in key high components.

eat pressure lightweight, other for SCBA are sufficient cylinders ergonomically our The firefighters first and carrying while enables oxygen We nature be lighter also high and safe to leaders in shapes responders for world products the a composite of ration applications. for and in flameless ready healthy defense desire healthier technology response heated A safe lifestyle using task. for growth meals application. difficult as to the grows profile also our demand emergency and our

our mega environment product trend The accelerating of is in the and Zirconium trend our as applications. lifestyles. cylinders lower sales growth And water the of our medical products, emissions of used auto portable from towards Additionally, catalyst alternative oxygen clean towards our fuel also growth safe also treatment products healthy benefit and pharmaceutical and fuel global line. and a

is multiple stringent environmental introduced being in increasingly platforms newly to gas our example, For meet particulate filtration regulations. product adopted

a continue that vehicle As we catalyst result, future. auto foreseeable our believe per content will increasing for the

slide our reduction upgrades to including energy to them our or more Next, to dioxide processes in on manufacturing first reduce landfill. I and waste, update carbon reductions XX% our XX. reduce XX% then, and recycling to waste published initiative carbon ESG make Recent making across wanted to November water ESG XX% ESG emissions, you improve use investments in fresh the busy in commitments, usage to have of footprint demand, equivalent friendly. in exceed improvements includes been We further to increase our environmental to report company meet we Since dioxide on efforts reduction XXXX. our

and As to we new ESG that continue savings. also waste journey, finding our opportunities recycle generating are we cost is reduce

For example, ground allowing installed new cost materials additional to facility to savings. oil our Louis capability separate generate St. both and a us from recycle waste magnesium,

resulted have our as in party such significant initiatives, We ratings progress third from agencies ESG improvements ESG are our which our of on proud in ISS.

building technology. remember, with to attractive our foundation XX products recap long-term a company's niche how please Luxfer for serves markets slide we proprietary success. to Now, Four and turn thoughts for for are the

simplifying The will phase reducing final take transformation will on our the portfolio our that Our growth delivered towards margin and by years the plan has growth. delivering few structure businesses, cost place and of higher next reshaping transformation our over plan results accelerating focus expansion.

thank for I to the safely runways deploying We to operational of Once and Business have Thank around standard growth. accelerate plenty want shareholder first. by Excellence putting for always listening. again, toolkit our operating the while facilities our to you additional employees pandemic, the customers value our drive world create our improvement during all Luxfer

questions. take now will We

Operator

from [Operator question the Moore CJS of Chris first Instructions] Our Securities. line of comes

ChrisMoore

a guys. for few morning, taking good Hey, questions. Thanks

multiple made on guys significant You fronts. have progress

bit over Just of growth hoping in from guys, years reasonable specifically expectation strategy growth of terms internally? on a three more to is focus five a range maybe there you the a the to number or that little kind organic talk about next standpoint

AlokMaskara

focused about we Chris, company on that's accelerating have a plan next great is growth transformation Historically, the question, phase talked of our GDP being profile. plus type our growth. because

than faster alternative Chris, to transportation number a the this also around profile lot Simply because segment That acquisition with on with think and user out of from which clean continue than but grow fuel Both we a that. I tailwind. further stage, growth three expect at CNG. grow position depends the positive our our we increases rapidly. the do macro fuel, much products, SCI or give wouldn't alternative current and industrial expect should this we expected. better get emissions market which and the And and our to of end and the be new user momentum the to of defense our end momentum had hydrogen in previously

ChrisMoore

it, really significantly R&D new need in to to Got do one ramp keep vein, helpful. order product In similar you pushing revenue. it's

AlokMaskara

a we not perspective, the I in think our years, lot make year been those progress. looking did much of consistent for in investments few past from COVID; that's R&D. to are our effort activities last increase the And with

Yes. But that. we We be X% are to than our more word few less it's much the that use to years? look not we yes, So going of use would revenue R&D, double in than the increasing; I significantly. next wouldn't over

planning spend X% our less of or total period, range a long it's Chris. think would over I be still

ChrisMoore

on helpful. for just SCI. bit And last little a That's me one, it. more on Got

In business, do lower you that? above and mix than I be that, better XX% margins of alternative of the or half do EBITDA can it's a terms will so it aerospace look think I talked piece you is the half would that's and looks on like that CNG the are, about fuel it, out You, that, you aerospace? years at hydrogen think roughly couple the how

AlokMaskara

really be that, Yes, we Chris. aspire no, more than to

couple going if million to losses at get synergies million, total $X of this year years. around about breakdown you assumes and probably which in recovery niche aerospace growth stage, look niche $X the to think fuel, next million, at no in applications. be over aerospace revenue I I XX% Currently, That are easily to we half $X would our roughly this of of the alternative of other quarter various and quarter think applications. about is

So I composite our fuel, in margin it'll to think growth know think profile, come cylinder as up as aerospace continued higher XX%. is we and perspective, we recovery than overall put in alternate which you

Operator

a of of from Our Irwin Craig Capital line next Partners. comes question ROTH

CraigIrwin

Good and result. morning the Alok Heather. and Hi, congratulations strong on

there business quarter? be more and years? Or nature? of now? last And Was is with mix in of quarter. Your go was this stronger selling and result talk about, we've we particularly specifically EBITDA performance. done margins over number what's find higher, Elektron the at time you restructuring were to you're sort the like go strong repositioning back have Can in the that anything years to products momentum back three To one the to they'd something this the a couple driving this

AlokMaskara

you on want that? Heather, to do start

HeatherHarding

would talked results. you some I weren't aerospace. as you. the I think nice in the one the of really real as reductions. of Yes. it lot that margins, of Good a There result the growth done cost we've work a to items on we and good repositioning primarily, about, is of through we it's speak morning, significant say And and certainly, saw we highlighted, with any some in timer the Craig,

that As to been within years. of the our benefits of we some the all that doing continue that momentum realize that return efforts course, said, businesses segment, really the over then to would other been and segment, we've the past in three and growth, some cost reduction, have Elektron of of

CraigIrwin

theme savings result. impressive on continue this reductions, And quarter. the cost an in achieved just to That's $X the of Excellent. million

And the the little was can hanging savings of picking guess the fruit, the you you're from savings additional time you give think maybe last us end I from? detail that about the overall total it forecast program? we like see bit a you where where possible When -- savings low this that of from later had is just exceed front could came total that the program. the on year I

HeatherHarding

Well, as this million exceeded the highlighted already the right. presentation, we $X we've $XX in million, the certainly with year,

we're currently sitting million. life-to-date at of kind So $XX

very perspective, that from pleased. we're So

quarter, are the very As there don't to certainly will look mentioned required. in particular continue we had expect be I we continue certainly as this to savings? Alok continue some will every this pleased level time, cost investments forward be that with performance will And Yes. quarter. that there we're

we in the where they segments slightly two were and of cylinders right of Elektron, but was highlight terms when million. cylinders, they split do $X it from, it the In pretty look, to around gas equal, between was were came you the but terms presentation, each of gas -- back more, the in

look really I that's was, fairly also mix our which to think cost a that by So see reduction between enterprise. which the you at reduction know And as when you think the said, encompass entire equal. I the plans, cost segments, important acceptance two full that I

So would my be response, Craig. that

CraigIrwin

Understood, thank you.

your then, the growth I margin of key over Alok, to couple the one able So respond where expansion. to rate next on get things of a reticence understand to years to you're the is question.

able has be to company? the XX% improve cetera. growth, couple years? sort look manage a et plus not several higher gross margin mean, the margin target mix, are you and as basis markets see How I would does visibility improving, demonstrated margin potential good expansion, as can products but points everyone but the as as margin potential XXX you over to I being operate a into move you and things mix guess margins, higher far and Luxfer wants. But and next excellence better, you've control of in the as is really at don't You

AlokMaskara

And Craig, hold that's are earlier, Luxfer that I a at our today as a ever to we look at to quarter trend. three futuristic margin. then to get margin. about And And margin. And XXs teens it, we years getting think would talked about we we very aim listen, one question. first doesn't were talking XXs is make

So we are focus really hard SKUs. our this And using going of the hold sure to the given effort, to and and XX:XX sort cost shape work shift portfolio, make to reduction and strong and fewer we factories, exceed the given level. in portfolio capital, huge working on frankly, lean principle a

I think current we be to number. the are we'll able confident hold

number Aspirationally about for investments with SCI to overall make the But commit which Absolutely, is delivers million is integration for we've us. and as appropriate growth to savings hydrogen, know numbers. make will margin yet. focus is talked to call cost committed an And certain good reason synergies. And for million a that complete we it itself, a to sure capture much higher? the end a want $X the transformation plan only aspire do in and growth that, $X business the our a yes. We you to to we achieving great Not we higher? we we in

still year. manufacturing to reluctant it long much productivity the as And expansion Going number with to forward, cost every let's yet. in takes imagine, a you I commit expect us where margin obviously term. higher can see X% continuous But

CraigIrwin

that of you Understood on products. the gaps the me, but in at can hydrogen least believe your tank one I maybe correct the And hauler side is for portfolio, opportunity then

What about you add do portfolio? there given it? there's of from looks you Some to of plants, there? first in cost think long-term going you pressure what development are the commissioned opportunity? plants product with to obvious trucks, parties be five take green hydrogen incremental about fairly haulers now the avoid these that hydrogen these that right? of soon. Do an purchasing of one like might two a It supposed you plug already do for those see sort to it you growth high the tank to to the need hydrogen green And some sort comment for liquefaction. Can the serve third of hydrogen as And just by

AlokMaskara

exciting There that is then whether it's very Craig. see of and the for of customers in and earlier small that there, by you the us. and sizes transcript, work a others. fill we market. my mean with that a We have working would hydrogen gap green that gap I a X, portfolio long- is growth are in name totally a up customers that do I We mean, future. we Type our term opportunity I our you're It's and right. believe wave required product a for in bar on XXX essentially referenced matter coming just with custom

market. certifications the have to already we getting right So of and that the approvals core technology, matter enter a it's dot

So it. to get we And on committed there. like our are we to remain way

CraigIrwin

per that before we last your vehicle. the seeing hop a may, XX% question, seeing the I for content out potential so opportunity sort as in back Are us? And this Excellent. there? does automotive in you're fit the opportunity of I the catalysis if vehicle, the growth per available is increase How content queue, potentially a per If vehicle years? is What exciting incremental frame over maybe could doubling? for increase together next you couple

AlokMaskara

Sure.

you think guess terms, well, percentage I've dollar in term. if about, So the I in said

we look content per vehicle. XX% our yes, the in at XX% So increase to is

still about are US, is XX$ outside today, last some is, growing because becoming having excited higher for the almost But COVID. We increase QX, chance that hardly than requirements very production to QX a to of US also in California any near because slow a regulations emission in year For do the XX% going content all remember, emission of future US, year, it product the of Autocad lagging. that timeframe. is from that market And business was the given level. on higher business standards in and with good. we're where is federal for What look more at the

in standards emission US higher just market just today. expanding beyond the about excited to and markets and other the are we So Europe then

Operator

Your line Sherbetchyan next of Securities. from a Sarkis comes B. of question Riley

SarkisSherbetchyan

and like acquisition, today? Alok sales. think with million today? question wanted $X seeing the getting that margin million morning cylinders to first cylinders Good therefore $XX your what here. your portfolio, let's to right gas to looking million probably of loss eventually combined this cost to my you SCI on fixed I better accretion to it your of Hi. about touch Hey, year next profile can firstly, Or think and business $XX on you Is the and Heather. for $X for year eventually here. taking about Thanks it And synergies, do the a with margins a to get you just think better in call million business margins gas $X million that absorption portfolio the seeing in we're in SCI mentioned we're

HeatherHarding

good deliver addition to Sarkis. this And I'll accretive talked here the million in we'll the and turn morning, of million one. journey this that on as on $X synergies be XXXX. to start to about Yes, we're us about excited Certainly, $X very that expect acquisition. we to

thought filters, we looked this. look the at of strategic reason compelling renews our through and ahead that when we benefits As part we the

think I about potential it as correctly are there, we think opportunities, leveraging additional growth, of additional right, costs. there you're thinking opportunities about fixed

synergy now $X million. on next to is work plan, over so going to deliver initial months, main that. this through And and these focus $X million XX-XX our But we're to work right those

SarkisSherbetchyan

now it composite? product of for think about Or as gas lines cylinders thanks of portfolio divestiture to that super is certain be entire lines, And pending. think is the in and kind I lingering? aluminum still that are Heather. divesting form I are wholly there think, the that the aluminum correct Would Great,

AlokMaskara

products small majority shared take oxygen. a small oxygen. type vast now on which type the And both of our cylinders. composite, is LXX, or high two are pure are medical include in used focused medical one, amount Sarkis. a of four I'll that the typically But now sales in There of are aluminum factories of made such are mostly majority applications three? aluminum alloys aluminum There new Those type one amount like that the in type that as are quality factories.

SarkisSherbetchyan

as plan a different that's kind what that far of SCI? seeing on that there in of and the is digested to game after comparable or you're composite therefore rates you've of holding of you're kind small to piece as is kind it business left And growth of

AlokMaskara

a obviously probably where of these the good want business, as we fuel ROIC, very not shared the focus profile to location, look good us sure our like we out. good it's it's And that other as value that space. competition make to We and at on have digesting alloy We specialty areas, a while SCI medical for and oxygen compared the not business. are because kind worth to just still growth proposition is alternative in business, separating differentiated piece

complete. transition think I now, for So is our

SarkisSherbetchyan

to that. the thanks touch the No, balance maybe for on for to And this sheet? much of kind here? could formed. just And super want on the diversity bring timeline Any potentially in timeline thoughts cash how

AlokMaskara

Heather. ahead go -- maybe Heather, Sure.

HeatherHarding

the between $XX this our that take during I'll $X remaining XXXX, still somewhere divesting the committed of Sarkis. one. and million. by Yes, to and end expectation is so million current year, operations by We're

SarkisSherbetchyan

kind there right. Okay, as on onto high Elektron no, That's of gas as remixed that of and good. really coming portfolio, that requirements strategic cylinders different one margin kind roof? are we run any capital kind with different to in kind from of do And very back at you what the that the business, division. well finding the sounds portfolios point Or it's under businesses together may pretty and historically margins, think two going the on applications just think the and one the there do Elektron front, come different And been And growth entire see trajectories of actions then two niche side, you've both you the look another? about?

AlokMaskara

making is our create, focus, value. to value Our and that maximize shareholders Sarkis, for a

we so open And remain strategic moves. from to broader perspective that

They're strategic of work enhance others. the both a we're as the come the Now, over could profiles But hydrogen both remain profile. better very you broader very growth opportunities with other we far also advanced both few in to CNG perspective, further profile growth But exciting. one they the still from on has and ROS material, our pleased ROIC, value. have slightly good than margin businesses, shareholder improvements and years, mentioned, they is great both how segments from both past open that have

more So there's as to opportunities value. opportunities, that external that long all sure will to I which us are say as open But this never. the will remain it make we had we captured to to runway creates there if for do never internal part, we shareholder still significant doing. broader continue But

Operator

comes next Gibbs a of from line Capital of Markets. Phil KeyBanc Your question

PhilGibbs

Can and Heather, you Good, hear Hey, okay. Alok me? morning. good

earnings, lots implied give Your for in EBITDA that you terms also end? there's year then $X.XX of pieces. moving to of And within can implied framework? an know the I $X.XX D&A

to and just trying communicate trying that? what you're for So square in to

HeatherHarding

Yes, And one. to are with D&A about, I, moving I what it's you're we're But take that when when right; anticipating. pieces million Phil there of is $XX.X some think I'll is million. so so that. all regards around first $XX.X around

it, to $X.XX In XX that of terms of kind EBITDA imply somewhere it. $X.XX about call let's how would XX, thinking is somewhere EBITDA say we're to range, between in

PhilGibbs

the And that's the much SCI million your $XX $XX at cash is helpful. million in from costs then you restructuring of of deck your integration? that how that about Okay, midpoint, outlined

HeatherHarding

Right.

the So if XX, less could plan, former XX, we call the plan. you XX-ish, be think or from transformation had about it XX transformation

call So the like midpoint that that. integrations seven-ish, we're rest talking with be SCI something then the would around that

PhilGibbs

saying? you're SCI, from Seven

HeatherHarding

Yes.

PhilGibbs

year? I rest of first of $X.XX, cadence the in split But think Okay. Alok the he to how the talked $X.XX a And for night said the last the does I losses, about the quarter. that

HeatherHarding

splits QX QX, So it's of I year, about between split tell point, it's, rest for but in and meaningful. evenly it's slightly that and you would QX two it's I three, the that how this at heavier think the pretty I know if don't

perspective, would divide a three just could I by So about. you almost say from modeling

PhilGibbs

And up commentary or defense, line this of would include anything year-over-year, then commercial, comped said and there be appreciate top that in you. Thank -- appreciated? Okay, aerospace you that. last in terms the purely does question, my aerospace, is just that

AlokMaskara

starting think showing fixed recovery. by lower a think focus encouraged. more of government are especially Military I separate is driven both much for and to we on defense, see I to aerospace that's the aerospace, these from wing it post-election as But signs been signs of have our portfolio. overall focuses and that's know and And you are recoveries to the we and comes stocks, helicopters, if we and flares as think MRE. of replenish do many I

get defense, quicker. going more be both of but to we that's signs recovery to level expect think at in than I good the rebound so. But to normal aerospace, back an faster showing

Operator

numbers us you second the Luxfer of about the available An joining will be XXXX encore hours. This recording when Thank call Luxfer available the call. ends two will of conference results. this Telephone The recording scheduled XXXX to financial on will regularly next be the in for conference in access discusses call quarter be today. its company July website@www.luxfer.com.