Ladies and gentlemen, thank you for standing by and welcome to the Synalloy Fourth Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference may be recorded. I would now like to hand the conference over to your speaker today, Craig Bram, President and CEO. Please go ahead sir.

Good morning everyone. Welcome to Synalloy Corporation's fourth quarter 2019 conference call. Dennis Loughran, our CFO will provide a review of the Q4 financials and then I'll provide some comments on our business segments. We will then open the call to questions. Dennis?

Hello everyone. As usual the financial results will be presented using three different methods; first, GAAP-based EPS; second, adjusted net income, a non-GAAP measure as defined in the earnings release; and third, adjusted EBITDA, a non-GAAP measure also defined in the earnings release. Fourth quarter GAAP-based net loss was $0.9 million or $0.10 diluted loss per share as compared with net income of $0.5 million or $0.06 diluted earnings per share in the fourth quarter of 2018. The majority of the decline in profitability took place in the Metals segment, where despite a 5.5% year-over-year increase in pipe to tube shipments, operating profit declined $3.7 million due to several orders of competitive and surcharge related pricing declines compounded by a weakened tariff-based pricing support since they're disposition in early 2018. Other significant differences in year-over-year performance include; the American Stainless acquisition increased fourth quarter 2019 operating income by $0.7 million with no comparable results in the prior year period. This January 1st addition to our welded pipe and tube certainly provided -- proved to be a strong addition that we expected delivering consistent sales and profitability while other sectors were experiencing soft markets. Q4 of this year was favorably impacted by a $1.7 million in mark-to-market valuation gain on investments in equity securities compared to a loss of $2.1 million in the fourth quarter of last year. Q4 of this year contained $0.6 million inventory price change loss compared to the fourth quarter of last year which incurred inventory price change losses totaling $0.2 million. The fourth quarter was substantially improved in the balance in pricing and inventory costs compared to the second quarter and third quarters, where the majority of 2019's $6.4 million inventory pricing losses were incurred. Q4 of this year included favorable net one-time adjustments and amortization…

Thank you, Dennis. The coronavirus has been front and center news for several weeks now. So let me start by commenting on the impact that we are seeing in our respective businesses. With the Chinese economy under pressure, base metal prices have fallen by double-digit percentages since the end of 2019. Nickel prices are down 10% and surcharges are down by between 15% and 17%. Oil and gas prices have been under pressure as well with the WTI price up more than 23% since year-end. With the outlook for a weakening global economy, there is a fundamental oversupply of oil and gas that will likely not reverse in the near-term. The supply of raw materials to the metals and chemical units have not been an issue. We have limited exposure to raw materials and other supplies that are produced overseas. And do not anticipate any shortages that would be detrimental to our production goals. One of our galvanized customers has had difficulty securing raw material from China for their European operation and has increased their tonnage with our Munhall facility. We'll have to see how long this additional tonnage last. We've also purchased a new acid regeneration system for the Munhall operation that will be coming from a manufacturer in Italy. We expect the delivery may be delayed but we have adequate capacity to meet our pickling requirements in the meantime. In preparing our forecast for 2020, we projected a flat to marginally down year in terms of volume and pricing much like we experienced in the second half of 2019. Our forecast does not reflect the manufacturing recession. The exception to this thinking is the Palmer operation. At Palmer our forecast calls for volume comparable to what we realized in 2016 and we have rationalized our cost structure there…

[Operator Instructions] And our first question comes from Charles Gold with BB&T Scott & String.

Good morning Craig and Dennis

Hey Charles.

About 20, 25 minutes ago there was a press release that Privet had increase their holding by, I believe 314,000 shares and owns over 1.5 million shares. Could you comment on that? And have you had any contact with them in the last month?

Charles, we saw the filings last night both the Privet filing and the UPG filing. Between the two of them they filed as a group and they now own 25% of Synalloy's outstanding shares. We have not had any contact with Privet since December 5 or 6. So at this point, we have not spoken with them since their most recent filings.

Could you elaborate on up UPG?

UPG owns 723,000 shares. They own roughly 8% of the company now. Obviously the heavy volume that we've seen in our stock trading in the last several weeks has been UPG. And then in the last three days, it's been Privet. And we have not spoken with those folks either. They look like a privately held holding company for primarily steel businesses. And beyond that I don't know anything about.

Thank you.

[Operator Instructions] And I'm not showing any further questions at this time. I will now turn the call back to Craig Bram for any further remarks.

We thank you for your interest in the company and look forward to sharing more details with you in the future. Thank you.

Ladies and gentlemen this concludes today's conference. Thank you for participating. You may now disconnect.