Ladies and gentlemen, thank you for standing by. Welcome to Enerpac Tool Group's Second Quarter Earnings Conference Call. As a reminder, this conference is being recorded today, March 22, 2023. It is now my pleasure to turn the conference over to Bobbi Belstner, Senior Director of Investor Relations & Strategy. Please go ahead, Ms. Belstner.

Thank you, operator. Good morning and thank you for joining us for Enerpac Tool Group's second quarter fiscal ‘23 earnings conference call. On the call today to present the company's results are: Paul Sternlieb, President and Chief Executive Officer; and Tony Colucci, Chief Financial Officer. Also with us is Barb Bolens, Chief Strategy Officer. Our earnings release and slide presentation for today's call are available on our website at enerpactoolgroup.com in the Investors section. We are also recording this call and will archive it on our website. During today's call, we will reference non-GAAP measures such as adjusted profit margins and adjusted earnings. You can find a reconciliation of GAAP to non-GAAP measures in the schedules to this morning's release. We'd also like to remind you that we will be making statements in today's call and presentation that are not historical facts and are considered forward-looking statements. We are making those statements pursuant to the Safe Harbor provisions of federal securities laws. Please see our SEC filings for risks and other factors that may cause actual results to differ materially from forecasts, anticipated results or other forward-looking statements. Now I will turn the call over to Paul.

Thanks, Bobbi, and good morning, everyone. Thank you for joining our Q2 earnings call this morning. I'm happy to cover our fiscal 2023 second quarter results with you today. I'd like to start by providing some additional color on our ASCEND transformation program in the excellent progress that we're making on several of the focused growth pillars from our strategic plan that we laid out at our Investor Day in November. Moving to slide three. As we reached the one-year anniversary of the launch of our ASCEND transformation program, I am extremely pleased with the progress made to-date and the results can be seen in our strong gross profit margins and adjusted EBITDA margins in the second quarter, which are both the new record highs, since the launch of Enerpac Tool Group in 2019. ASCEND is focused on driving organic growth, operational excellence improvement, and greater efficiency and productivity in SG&A to enhance shareholder value. This program includes many 100s of initiatives across all functions and regions of the business and is led by nearly 100 work stream leads and initiative owners across the company. Based on the work and accomplishments to-date, we are increasing our expected adjusted EBITDA benefit of the program from the original plan of $40 million to $50 million to a new target of $50 million to $60 million as a result of additional initiatives added to the project funnel over the past year and initiatives executing at a higher success rate. We now expect $32 million to $38 million of adjusted EBITDA benefit from ASCEND in the current fiscal year, up from the previous estimate of $12 million to $18 million. This is driven by $15 million of EBITDA from ASCEND initiatives, included in our original fiscal 2023 guidance that've now matured through our ASCEND…

Thanks, Paul, and good morning, everyone. Now turning to slide nine, let's review our adjusted Q2 results. Net sales in the second quarter were approximately $142 million, which is a 6% increase in core sales over Q2 2022. Tool product core sales were up 10%, service core sales were down 4% and Cortland core sales were up 4%. Adjusted EBITDA margin was 22.7% in the quarter, which reflects a currency-neutral incremental profitability of 186%. The adjusted tax rate for the quarter was 18%, which is flat to the prior year second quarter. This resulted in an adjusted EPS of $0.35, up $0.21 over Q2 of fiscal 2022. Turning to slide 10, for details on our sales performance in the second quarter. We reported year-over-year net sales were up 4%, including the FX headwind of approximately $3 million, driven by the strengthening of the U.S. dollar, primarily related to Euro and GBP. Product core sales increased 9% as we continue to see consistent demand for our products. The second quarter saw solid consistent growth across regions, including double-digit growth in Europe and high-single-digit growth in Americas, MENAC and APAC regions. Pricing actions contributed approximately $10 million of the top line with roughly half of this benefit in the quarter attributed to the impact of ASCEND strategic pricing. Lastly, service core sales were down 4% over Q2 2022, driven by declines in our APAC and MENAC regions as we lapped strong prior year growth in both regions. In MENAC, this includes the purposeful exit of low-margin service business. The core service decline was partially offset by Q2 growth in our Europe and Americas regions. Turning to slide 11, reflecting a consistent trend noted in previous quarters, IT&S product net sales significantly exceeded the peak range of the four years prior to COVID…

Thanks, Tony. So based on the results of the first-half of the fiscal year, current foreign exchange rates and our view on the remainder of the fiscal year, we now expect full-year net sales of $580 million to $600 million and an adjusted EBITDA range of $118 million to $128 million, including an ASCEND EBITDA benefit of $32 million to 38 million. This is based on current foreign exchange rates and assumes there is not a broad-based recession. Before we wrap up, I'd like to thank all our employees around the world for their hard work and dedication to making Enerpac Tool Group a more agile, efficient and ultimately a more successful company. The organization has gone through a tremendous amount of change over the last year, since we announced the ASCEND transformation program. All that hard work is paying off as demonstrated in our strong results, which we are extremely proud of and it would simply not be possible without the broader Enerpac team that we have in place. Despite, the uncertain global macroeconomic environment, we believe that the work we've done related to our growth strategy and ASCEND has us well-positioned to deliver enhanced shareholder value. In closing, I'd also express my sincere thanks to Barb Bolens, our outgoing EVP and Chief Strategy Officer. We recently announced as part of our continued simplification efforts, the elimination of the Chief Strategy Officer role. And as a result, Barb will be departing Enerpac on April 1. We extend our heartfelt gratitude to Barb for her leadership and contributions over the past nearly five years and we wish her much continued success in her future endeavors. That concludes our prepared remarks. But as always, please feel free to reach out to Bobbi Belstner if you have any questions. We thank you for joining our Q2 earnings call, and we look forward to speaking with you again in June for our third quarter results. Thank you, and have a good morning.