Encore Wire Corporation (NASDAQ:WIRE) Q2 2023 Results Conference Call July 26, 2023 11:00 AM ET

Company Participants

Bret Eckert - EVP and CFO

Daniel Jones - Chairman, President and CEO

Conference Call Participants

Julio Romero - Sidoti & Company

Brent Thielman - D.A. Davidson

Operator

Hello. My name is Chris, and I’ll be your conference operator today. At this time, I’d like to welcome everyone to the Encore Wire Corporation Second Quarter 2023 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions]

Bret Eckert, Executive Vice President and Chief Financial Officer, you may begin.

Bret Eckert

Thank you, Chris. Good morning, and welcome to the Encore Wire Corporation quarterly conference call. I’m Bret Eckert, Executive Vice President and Chief Financial Officer of Encore Wire. With me this morning is Daniel Jones, President, CEO and Chairman of the Board. In a minute, we will review Encore’s financial results for the second quarter ended June 30, 2023. After the financial review, we will take any questions you may have.

Before we review the financials, let me indicate that throughout this conference call, we may be making certain statements that might be considered to be forward-looking. In order to comply with certain securities legislation and instead of attempting to identify each particular statement as forward-looking, we advise you that all such statements involve certain risks and uncertainties that could cause actual results to differ materially from those discussed today. I refer each of you to the Company’s SEC reports and news releases for a more detailed discussion of these risks and uncertainties. Also, reconciliations of non-GAAP financial measures discussed during this conference call to the most directly comparable financial measures presented in accordance with GAAP, including EBITDA, which we believe to be useful supplemental information for investors are posted on our website. I’ll now turn the call over to Daniel for some opening remarks. Daniel?

Daniel Jones

Good morning, everyone, and thank you, Bret and Chris. Thank you for joining us on the call and for your interest in Encore Wire. We appreciate your continued investment, confidence and support.

This quarter marked our ninth consecutive quarter of elevated margins despite our continued belief that we are in the midst of the period of gradual margin abatement. As we have discussed at length on prior earnings calls, copper margins began to gradually abate in mid-2021, and aluminum margins peaked in the fourth quarter of 2022. Since then, we’ve invested heavily and continue to invest in improving our service model and efficiency levels to reduce cost, increased capacity and deepened vertical integration, which we believe should contribute to achieving sustained higher gross margin levels when compared to pre-COVID baselines.