Mativ (MATV) 10 Aug 222022 Q2 Earnings call transcript

Hello everyone and welcome to the Mativ Second Quarter Conference Call. [Audio gap] …Chief Executive Officer. She is joined by Andrew Wamser and Executive Vice President and Chief Financial Officer and Mark Chekanow, Director of Investor Relations Today's call is being recorded and will be available for replay later this afternoon. At this time, all participants have been placed in a listen-only mode and the floor will be opened for your questions following the presentation. [Operator instructions]. pleasure the my Mr. over now is to floor turn to It Chekanow. you begin. Sir, may

Good Mark us Thank Investor I results. morning. you. am Mativ. second XXXX you our Relations Chekanow, Thank for discuss joining to quarter earnings at of Director

like the begin, you remind detail these number filings, Form for results today's suggested I'd included results may of that statements. a are more include by and in forward-looking report Before and Actual comments discussed our reasons, differ in Exchange to on our we including reports the call, on Securities materially in which XX-Q. XX-K from Form our quarterly comments Commission annual

are the metric release The prior and call presentation Some release. are included measures measures. as non-GAAP on are financial comparisons period these and financial Unless available the presentation. stated operations. closest financial is this Reconciliations to otherwise, of continuing relate appendix earnings the and GAAP measures slides in discussed earnings today's the this are for measures ir.mativ.com during of to to website the operations year our

You discussing separately. on the be them, discussing company quarter can webcast using and/or and download July were results To slides we'd second through how how be second reported legacy interphase. of some Mativ call SWM first ended. closed clarify remind nuances, we'll Thus everyone the for pace own XX, and the at merger your the these Neenah we'll that the quarter XXXX, after slides results the during click

in trends, quarter both previously Julie. you any XXXX SWM the business. the financial which as discuss Andy results with legal business quarter. structure, make understand for include Mativ structure the together we needed disclosed be with sure Given for clarifications, turn are the businesses legacy further of results third review the results we'll reporting the that. and reported processes. in second us shortly. the transaction, for want to With follow Neenah to over Mativ our Beginning accounting results Please reporting will the not I'll up included results results of and as The will Mativ call only

facilitating still full product results the year-to-date are employees and first Thanks business; commend Mativ guidance. service good the we companies merger to and to on separate enter of topics. highlighting our and quarter Mark. I base second And company's to and planning. transformational to our and the allocation integration operating emerged each global a about companies the early lot input strong full Neenah moment share quality I'll more as many line, XXXX from in great eager a across delivered profit both previous with have themes second inflationary actions robust legacy costs quarter across Mativ We for the and and everyone we enterprise. from Bottom call both There's transition our want optimism year on momentum some This delivering Pricing with companies our of take call I'm earnings while SWM by customers teams track a results, portfolio. key today close to that discuss joining the half outlook, to appreciate safely and outstanding closed execution and our important solid color positive and remains second legacy cost of future. capital July off powerful and our merger remain between quarter demand on pressures results. lead offset second have fronts. a of

a We long potential to progress, deliver by and dedicated ambition of and plans. cultural stage the the complicated up And on with and integration together merger. our early office and come said, transformation can fit process, to move on and open not I'm integration have tracking we organizations functions we this ensure have execution. to assured energy as a be set delivering alignment have in this all near incredible we Our our and That with encouraged rest transaction. focus know across forward will and that expected day-to-day in lose to coordinating term not continued planning, communication the synergies deliver of excellence the

highlight We more will value elaborate on shortly, some early the we year capturing synergy way are the with but progresses. that I'd also as already

our communicated to bankable. vetted well consistently as have our is we plan. points plan I about and say, I synergy a to few $XX like As want million reiterate

to synergies run plan of First, total by the rate the we end expect exceed half of one. our year

on executed first $XX in have months. will we million XX the So over

spend Second, achieve the $XX half million. procurement organizational and about from rationalization The the chain synergy related does from assets footprint these not and synergies, are other or require to half all supply plan and facility SG&A opportunities. cost

million. Third, the synergy to longer $XX term that we line see incremental would that top opportunities be growth

merger, exciting creation of adjusted in with am annual issued guidance also early to the consistent potential outlook. and million range half project the near-term second a longer $XXX I of plus $XXX previously some synergies. our the to term is value we This In for stage of of Beyond share EBITDA SWM Neenah, XXXX, pleased million.

portfolio to backdrops. greater continues variety a and with challenges and Although the uncertainties, for us diversification combined external positions environment resilience economic of present our

books, plans. and meet leverage, have cash we quarterly with we order I annualizes basis. share, want confident delivering last plus is remains compared and companies' on We structure, performance top our seeing when rapid announced Construction or cost a in we some to quarter per anchored previous capital. XX% $XX this elaborate million $X.XX with pay-outs qualified sales. global with With approximately strong to volume. quarter. provides growth allocation sales to current were robust, operations, improvements to shortages well, segment. coming respect are cost profit up that were with are availability, an delivered us increased Pivoting reduced growth slightly resin sequentially. supply and X% demand cash further, of Price but especially second This and In on as with dividend infiltration customer TPU strong products. Andy to topics, slight Engineered we increases pressures sales our within a paramount level particularly and help assure strong quarter return by dividend, up pricing through executed delivered which last continued annually. commentary strong sales we were filtration our the year's against a on products. provide consistent for actions water times, particularly improved Demand growth and up nicely adjusted portfolio outstanding high SWM first Given protection execute us capital first inflationary outlay supplier and will covered advanced paint and have a with organic solid risk from well effective, to of XX% volume pressures very and delivered to came growth during fastest, EBITDA in Papers, top the investors a board is can overall revenue campaigns both sales The investors reliable as on pleased categories. we I'd and driving despite in and a grew process grew emerging material pricing like easy, compelling both these the while these customers. as were did double-digit combination reliability total conversations delivered growth with growth. quarterly AMS, priority fastest year-over-year now industrial year of In quarter across This key sales Transportation very XX% Within Legacy priority. input some XX%. results. delivered the demand. emerged, a strong gains industrial customers additional at teams security Overall, of are fronts from The companywide pricing portfolio as and volumes never we growth films. and are Consolidated

costs energy significant paper our escalating hit been way. However, have in business and a

energy our spike covered margins negotiated increases for and costs, the higher volume pricing the material actions While quarter. in impacted

well contract Looking to some the as actions, the of further provide half resets increased forward, expect second year. offsets inflationary we as in pricing

ultimately performance. improved result While they price do in lags catch margin with these contracts, recovery up and

with side, clearly XX%. On and the results legacy cost adjusted sales up each demonstrated EBITDA recovery price excellent Neenah

this second for price quarter the increases price input as quarter, way to on $XX and lot in cost began exceed communicated during expected, million to costs first are our target our we While previously Neenah. ground well gained of a achieving improvement

affected price We to and accepted and that remains say are market been the by our strong. have increases demand pleased our

XX% and double-digit in during was growth. our fine our growth categories; filtration proven has environment volume commercial quarter. to release on had they each three pricing prints strong well segment, contributing performance. water and in gains packaging, by All sales times with saw unusual consumer strong and that service outstanding growth especially as Our also packaging to products can supply customers and paper industrials. Technical continued in double-digit up chain products segment outperform led business as rely liner of uncertainty. Within this us, sales the to The

of segments profit Importantly, margins meaningfully Neenah's in operating both increased year-over-year.

pricing to Our improved well margins. volume, actions growth well, continuing and delivering are platforms executed strong perform

margins volume and good and track continue investment quality expected release There's deliver and business. QX. In we on well to businesses. summary, both to customers. our momentum remains and and We unlock to to liner at previously performed companies expansions both are in delivered needed grow with organic continue capacity improve filtration capacity our expected as announced Pricing also These projects rates. strong, our in in

merger previously some plus synergies guidance and our We are path planned announced are synergies. the taking action early on from to stage on we

as provide other Now to to I'll more as updates Andy in QX topics. detail, financial turn key on it results discuss over well

Julie. Thanks,

on were growth which an pricing entire segment. across of while from or the resulted basis. Legacy up fastest areas well, combination the other in growth Within most portfolio saw XX% of For AMS, essentially and through sales grew films the a good gains volume XX% organic the performance. as strong We transportation XX% for SWM, came organic

balance reduced downward year, in Total an total are as saw their in gains and and of asset the continue in basis results cost continuation previous leading XX% given for OP natural which profits down XXX up segment electricity natural margins quite with expansion points AMS' concentration was and sequential for and and strong portfolio and prices that profit EP well also sales year-to-date higher higher Price grew Polypropylene the guidance. for meaningful more are impacted EP, points. adjusted product favorable very sales disproportionately XXX gas consolidated of year-over-year Europe AMS For the our for the is are trend the pleased increases versus continuing last with sales momentum adjusted and input We the these with feel adjusted but with than were operating more XXXX XX% increases, the a concentration on given costs price to of our were EP remain Energy a for second and pulp AMS as successful were other encouraging expected the current both and their year-over-year goal energy gains for mid-single XXXX points variance products and in bullish sequentially, the quarter saw this digit volume sales consistent XX% in is year of and off actions increases, peak adjusted operating offset prices trends for on slight We Recall US profits of many trends. margins material XX%. sign. year. very reliance than higher strong year. given continuing not volume expanded gas. segment half we and into the achievable full growth up covering costs. electricity. were XXX lines. basis performance with basis which XX.X% is risk of asset We EBITDA consumption the their margin and and operating in escalating range

margins half continue implement lag through thus reflect segment of in costs. mitigate year. more contracts improved the is resetting as higher We this year inherent costs, profitability comes We to surcharges energy pricing higher pressuring but to back the have far and pulp at and midyear to we the see

than operating which other items we at JVs, Looking share that was offset $X.XX $X.XX last the a energy EP, reflected addressing. impacted a overall, from which results below versus line we in EPS very cost growth issue. but income the the per of year quarter our are few profits, by is timing pleased with are Adjusted like the our

growth volume the range drove were Overall, [indiscernible] this For and while sales majority up Neenah, XX% XX% Appleton Legacy to excluding organic gains. effect of organic the sales total the on up X% continued or of shutdown. the site pricing in an basis, increase

you recoup led in input we product's liners, products, trends XXX million growth clear XXX or and sequentially. basis. points costs. XX%. increasing of operating overall year-over-year fine sales In costs pricing basis, expect, increased told, saw water margin paper and basis double-digit Neenah's EBITDA higher $X while as points year in gains both points grew on basis corners or the significantly As both first success over On sequentially. tech XX% gains given to over reporting our last segments or quarter higher Within organic actions Technical profit show profits an with driving XX% paper effectively points to $X All in while industrials sequentially and XXX the lease recover versus packaging adjusted and mentioned. higher the year-over-year would margins filtration, to XX% operating These demand remains fine and have price XXX Operating business proven and all three increased offset our while year-over-year costs. increased results margin and across as of a consolidated turning Julie very million categories showed operating effective. prices adjusted healthy increases raising basis increased profits basis packaging, our

price is on costs the well recovery and input price quarter was plan positive and material Second firmly positioned business deliver year. for this the to raw cost original versus

side, good and to growth. related On our the to pressures, incentives the performance unallocated support is some given inflationary year-to-date, investments increase

as which this inflationary cost businesses that of second year, project million. increases EBITDA let a range the direction $XXX half on see into both million We of financial to adjusted persist with provide help the benefits many Turning to of price $XXX the pressures me recover items in XXXX continued began guidance general for our some modeling. from to few year. We and in

actions are as especially all materials, offset to assessing as actively buckets, pricing We increases cost energy quickly and raw distribution and possible.

strong We the some to macro of remain expect slowdown. concerns demand a are there while portfolio across potential

this We and have on our not with books signs customers but our outlooks. in of remain seen yet business, talks closed in order

our However, of given feel should demonstrate a diversified resilience in macro end we portfolio our case the markets. slowdown,

the in personal For our given non-cyclical release business, engineered those example, business care products. cyclicality stability. we don't expect filtration resilience replenishment across papers inherent or nor of materials driven given has liners, consumer significant much its healthcare into cycles, go Furthermore, demonstrated economic

economic supply we feel comfortable While our for resilient that being difficult possible proof, and the costs. is silver to stabilizing recession claim a portfolio recession declining with slowdown lining chains input of potential an

approximately will highly year annualized over Our $XX quarters, be some realized actions a staged only as of the the million the two million portion of of executed we Naturally, the EBITDA guidance rate that we the but to are will next reflects expect the rest of progresses. deliver synergies. in also confident on the end savings year, the an million of By early $XX year $XX run be plan. per stage

actions provide how on exceed $XX coming have half over the confident run also we we're executed the with will We basis to a updates on the million remain of plan progressing. and year rate will that

As you legacy adjusted which the range may million. to XXXX $XXX approximately provided recall, sum million EBITDA companies both guidance, of $XXX to

that high many performing expense, While are $X.XX original environment, debt. with guidance level and with give is interest our are to consistent dynamic and second billion our puts businesses we takes half of well this there's starting On in total some range. parameters,

annualized seven the senior at roughly arrive our coupled interest million under approximately of you outstanding notes, $XX with our expense. on on billion $X.X credit six and X.X% coupons Assuming facilities, would

of million to have This interest debt rates on our fixed facilities total floating basis. annualized is to take $XX credit would our mid target have swaps. expense at the utilizing our XX% rates, While an range

on in this we detail a appendix presentation. our debt slide For structure, have included of the

our this For total XX% stage CapEx taxes, at annualized for probably best and good is is XX.X assume, million range, assumption low approximately a count million. to share $XXX combined a

reporting in note. there to our will starting a segments, results our change are QX things newly we While structure and report when aligned few our on consolidate

aligned in segments of as new on certain the across cost our some will be products segments, align we where changes be allocation while business. our existing small reported there may reporting First, generally with are

be guideline, segment segment corporate AMS will product and be cross and As and technical general material rolled Neenah's will will advanced fiber-based aggregated. or the ATM. and segment SWM's engineered essentially paper a technical paper solution the segment segment fine new packaging segment SWM's into unallocated Neenah's be

be of not financials, these results forma; report SWM Also be methodology some historical as segments the shown results. However, how prior pro costs business to as change. we will rather restated allocated the will be of are when may simply the

We will to we business priority. leverage is financial as capital trends us combined to clear to be possible across we allocation, want help clear de-levering be year-over-year and Switching when the key as results. set and say a

leverage post Our our net credit the close for is terms X.X times. agreement, of

year million Given quarters the improvements as natural of we for roll billion $X.XX of in place At increases to element net $X.XX a billion. net total X.XX net both debt calculations, to second X.X from our or trailing merger, XX times to we of within by times. extends and important the significant we the defined at leverage that X.X XXXX range maturities adjusted One debt for lower clear liquidity connection our agreement trend reported EBITDA structure in as cash profit end our understand plans for attractive and the synergies businesses with leverage also when adjustment in have have that believe de-levering and that times the we reflect of our had below legacy $XXX and times month credit debt in upcoming in financials of half expect EBITDA is actionable and to our an close, terms. which will an put assessing below makes of In favorable to target X.X out execute. leverage net XXXX

our we over have our We All told, attractive availability million and in million and liquidity. path of revolver we combined structure under to with $XXX have of with ample confident liquidity. $XXX are an debt cash, delivering

specifically announcing will does of by we optionality. M&A, pace buybacks be scale strategic increased since delivering. as and more Furthermore, Regarding said, our determined aspects for of those capital other the allow merger, allocation, our share

business growing we'll units, markets divestiture areas. efforts to our As a business the and product resources continue most key optimization to profitable and both capital we the pleased and investor topic assess fastest To We is July, goal we activities, to executed has of been and portfolio we our allocation end our quarterly cash conclude another are explore end for interest ultimate announce Mativ's concentrate into first small base. and SWM know products legacy from which our discussion, of dividend, small at our large.

recently a $X.XX view. dividend reliable a Directors returning of to quarterly annualized to our our cash compelling approximately share. $X.XX proposition rate million for value of shareholders, Our $XX per cash of an Board dividend and in approved per of equates share This

we we concluded that sense. several the a most across dividend ultimately made legacy examined maintaining While the policies, companies dollar two consistent total payout

this total we a formative. this see fundamentals near have our business We hope we dividend long-term value commit to Our and confidence the from newly current and remain limited meaningful cash positive, change the as established outlooks signals decision in we payouts. and

from large a record into shareholders, of resilient flow track for cash down long to to our and growth cash providing of companies pay debt. source return the expect to future, strong both invest and We continue

working investors. represents cash outflows range. total free acquisition-related been inflation in see we a million Mativ in XXXX XXXX cash sales, normalized $XXX capital return we free the While for flow strong and have attractive opportunity from expenses, Bottom very flow line, believe by clouded and long-term

Julie Now take back we up to wrap your before to questions. things

expected. to line were Andy. a QX or In points call. few today's from Thanks, reiterate better closing, in line I'd and equal bottom key than like to Top performance

in year, additional demand, the strong margin We and resulting expansion. of half second expect continuing operational the improvements pricing in actions

to have be below a de-lever to target path X.XX to range year-end well We and within and in our XXXX. expect natural by clear or

post-merger dividend, confidence our our it's in and with consistent cash providing current outflows announced to have meaningful and return We demonstrating our shareholders our a future.

Turning and synergies plans office working to have a on and are projects capture million synergies. the third-party plans, and of with transformation clear and priority in place ensure merger. track develop staffed place integration them. we is The in lead delivery and The implement of to to consultant $XX

and We the market. are in clearly stronger ongoing the and together our efforts to better uncertainties constraints offset in chain supply

We and with combined and the have early progress a cultural resilient more performance, business current scale. the portfolio the integration of X fit our between benefit pleased and I'm very diversified teams.

now our transformational are the unlock and this you prepared to open We working together combination. I'd This your I call to want time remarks. thank value like of concludes the for for today, questions. to

first Our Jon comes Instructions] Jon, Securities. telephone go CJS from please ahead. question of [Operator Tanwanteng today

morning, the ] Good [ first and a guidance? and results. thanks seasonality everyone Hi. in and questions QX versus within normal strong now? on about you're quarter second the if wondering puts having question, completing the [ of the I is congratulations the for weighting was all and right it seeing you talk my My to compared could merger your How ] taking close takes QX and

seasonality we portfolio as our as -- there's a forward, amount diversified. of would tremendous has especially I go not Yes, say more become

kind not XX that historically seeing years ago. have seasonality seen would we're of maybe So we

So costs to they're input is, fairly start split. Part that can of bit. little as evenly a moderate

and goes be We'll coming may resins fiber of little slightly, a to TPU still some think continue up down that but bit. some advance. I see

what the only were last thing year. the year when is I of that would add QX that at importance of year-over-year relevance look we for in for and QX improvements this just the And terms the balance the and

point, but think will be between QX improvements pretty Julie's significant. to it's balanced QX, and year-over-year I So the

in that second about started your compared about if the happens to reductions total talking in then more supply and especially their a actual you reductions then energy And what's little the Russia? my what And exposure voluntary talk bit people question, from forecast Understood. could natural to gas have your Europe? in

Sure.

are our of manufacturing of Europe. So X/X about assets outside

in experiencing, we we John, So the the where a business. have you greatest on and mentioned, smaller the depending footprint different we're as plans, have Europe And country pressure.

So think our from Germany, for place have are energy XX% about manufacturing large industrial, needs supporting next filtration the if about locked years X a I We've pricing continued technologies invest in our energy years usage. standpoint. to that also helps of the oxidation energy need. in invested reduce reverse reduce X a in and we ago, sites we of thermal amount we where asset or few that A

So path. we'll we redundant In agreements U.K. and preset also some focused continue 'XX, the that had primarily different as France. down capacity on across We've have optimize Spain and geographies and needed. to

our have near expect to to the in term, work or to those about -- pricing. pricing as Longer recover America and at in energy we're through to short have programs continue redundant we ops excellence opportunity, there some needs a term of of and going So mentioned, to and XX% established I'd lock combination I capabilities say term, established are in the our If in energy sales rationing, the price. Asia. is

rationing. can many the to energy much our lock varies definitely depending running to it we on about. kind the manage ahead a of have as assets, we of impacted For place country site plans quite where sites. and operating in that We're should we're energy running there be site then in talking possible fewer minimize any and as by have at to But it the opportunity needs the and bit assets those by

today's guidance? a Or are you your on Understood. rationale run actual so in far? plan rate there Is at to

current not There's in No. guidance. rationing any our

Got it.

And Okay. me. one last for

all about recession yet [indiscernible] you're but than anything number are you in in just what seeing Just you're through? at hesitating in more there, is -- know pushing given given have I demand, future? demand? seeing And out the any pricing how number what you confident saying how your are one. normal been -- periods? you And that flowing talking what you're elasticity not through, seeing people is two, everyone's as plans

Yes.

demand the take me let first. So on

demand remains as overall, mentioned, very we I think strong.

Solutions assets particularly healthy about in order our Papers running the care, demand Paper particularly then business, in maybe most primarily where business, taken industrial, less prior a are I and pricing. Engineered in Our business, strong. industrials, at but and in are our than we're still pockets very and Filtration, strength where areas, backlog cases. stronger levels, Those in and utilization think health most our little Packaging remains would And industrials some that and in our also Print seeing year water we've the

of So with to modifiers, of I we and pricing pricing great we that's actions From we a seeing in knowing job multiple your of primarily that Industrial those together with vehicles a implemented include that a we're our We've walked and giving the some structures point, volume up in market we how us business. and putting that teams on really and done you, pricing differences basket in would really to in be that. of goods some standpoint, our bit go pricing. give little may tell greater the have agility flexibility. expanded We've

frequent more have contract We resets.

greater paper parts fuel for we us added well. And So of our energy have parts of volume then offset Engineered are we have particularly inflation and in And surcharges in the many in as shorter agreements agility, some business. that some filtration in business. of agreements our that Paper, we've helping gives particularly to

and right shifted conversation that less has we no pricing, we'll have more tell less the So continuity path. of about ensuring pricing, continue place chain like supply in but meet increase the the about you I supply customers their price that needs. about to Customers, from would although down

our input of in is, with this and that year. see margin costs and belief that my and of half So back continue, we've pricing in seen the history that have companies a will you should expansion both year-over-year offsetting

synergies you early initial Great. your like I any customers seen in just If signs [ or close sneak post anything cross-selling ]. one more, Have Okay. of reactions could that? the from

Yes. been that customers positive, extremely even Customers areas anticipating. have in not some I was

are understanding we generate we capabilities together and portfolio that from the a come the understand customers So breadth to when technology of learning the standpoint.

opportunities filtration tapes integration overlap I'd adhesive customer technologies that an more backings across look is like and and the in opportunity And So provider, opportunities. vertical some at we the cross-selling portfolio. got as becoming holistic say upside particularly also is areas well and solutions great then lastly, and different a Part of we've solutions. as

positive. very But So very, still early. very

Our Ramgopal comes of from Sidoti. ahead. next Mitra, today question please Mitra telephone go

very wanted maybe how just significant in should the is your us touch is? at look the a sort The on downturn? potential when But macro portfolio, recession an environment. resilient assuming to is you there now. demand we've the next we as past just year, business a curious in And had right remind First, how how softening economic think think, has you it of strong shared

Sure.

So end over the our where resiliency. improved time, greater say, of I would we led to compete, companies markets which have has diversity both

our and if packaging In Engineered a breadth during continue offset release filtration, for that greater and another very we into economic of can Fine silicone And different and consumer trends about like businesses that needs areas water So during commercial most has medical I expanded in abrasives portfolio, care then downturn. tape been greater Historically, liners resilient hospital and greater cycles. example, and health strong and wound we've air has macro for and economic Paper do-it-yourself really resiliency and one filtration. we've Packaging, resiliency. industrial, have care, Papers much and applications have the than In products, portion packaging commercial into the which filtration, which think expanded print. needs into and more

this from COVID, companies standpoint, recently, then silver I Most tell a balance can downturn. of some and economic input only industrial a economic very and lining And to standpoint with our our I also some emerge I where with well team, of seeing infrastructure. sort The the some recession about a is parts would during you availability we consider would say XX% overall, have business. execute as commercial and would of portfolio, potentially think about be risk resilient, really demonstrated potentially of our slowdown help strength supply say to more to print sheet. both semi-resistant is cost economic both teams is downturn. ability very that would I businesses solid a other our chain So of the an thing

to And thing maybe just one add.

important COVID it's reference happened think during to in XXXX. maybe I what

about the you legacy organic EP down at when business side, And on resilient. about it up about X%. filtration you was basis, on when legacy Neenah was the So SWM was business, It really AMS the down that at X%, look was X%. look an

that a downturn we've feel of So had. sort and of of gives you last in sort flavor the -- terms

I'd So you to of just encourage at results. those look sort

of a especially great. that's -- in half. increases think color. inflationary nice should Thanks you're No, pressures? really second you've terms we higher half light How the obviously price success And of despite the with the Okay. about having in margins, had first already for

Sure.

terms So ATM to let The in then one. and -- [ referring me business the take of I'll ]. that start FBS

technical SWM stable I ATM margins expect in really And expect year-over-year so forward, in FBS half legacy going that business. pretty those the business, I I But going they're up be year-over-year. those I here would for relatively terms products when will the the would forward. point dramatic. business be to that's margin I is comparisons were and the look AMS would the meaningfully margins comparison second QX, continued year. the going in again, QX at decent from to think key be those And to and understand sequential about back quarter, expect improvement and the of of When the again

are any look synergies But And you or and assuming Okay. initial synergies you're guidance, obviously, we at the integration revenue from benefit there's guidance? a huge in going realize. restructuring as the the cost coming to

As would $XX run later point. Those stage. for now, terms in a million of The that are I revenue no, of being that on any about more synergies at not right we're talking rate. say -- synergies, the

duplicate of all have sort we we still integrate. costs lot that a right of not again, So now as of

that. So there's it'd in we're a of run I I think rate would -- all that, just line in emphasize, about cost. be And frankly. exceptionally sight million, that's and be that. And that confident But $XX fraction would clear of

Yes.

that the our synergy half. step-up minority half back of is back The majority base in is realization the in So the business.

it's since even But the just you're was know or terms only finally, then of mergers expected? it been better as And terms X than seeing expected initially Okay. have curious I month in what closed. in

going you, would really tell well. Sure. I it's

this as does. days. can't integration. are still early everyone a a the bumps be we in that big transformation a sure We It we'll hit Now is road I'm some recognizing in hobby. established office

That's that provides management. team and thing. And so project really process strong the first

is design I would org of schedule. second and thing our say The ahead is well underway

that So priorities. helps align focus the organization on and everyone

be working element well really in are would place third The and integration together. teams

been vetted, each to there's So team. aligned synergies have identified

The the updates or we'll early their plan, of targets provide quarter. and So synergies on everyone and functions, face each future plan goals. ahead are in knows

nice there's similar As We some came some similarities. cultures heritage I'd far how similar both from say -- [ our really are. Kimberly-Clark it's in We markets. ], compete as probably so from came any surprises, positive

at similarities some that and The of there of collaboration team, drive they common be find the talent, were synergy focused the path. there's that we'll If continue new combined different, and our opportunities the customers and there's market-facing, culture. our strength models opportunities. down bit to very little a on continue So different to one focus any units we're operating and aligning business the and

So all energetic excited we're really together. how and far, so very and move very forward positive about we everyone's

Congrats. great. again, you That's thank And question. your for Okay.

behalf listeners, any of your for now now the for concluded. The to presentation. our today's back closing has you the call you remarks. to like Q&A Thank for session team would thank question. over I hand On management

to interest talking look you forward your your We to and appreciate time Mativ and further. in today

all Thank lovely day. Have you rest joining. of a your for

your disconnect now may lines. You