Albany International Corp. (NYSE:AIN) Q2 2023 Results Conference Call July 27, 2023 9:00 AM ET

Company Participants

John Hobbs - Director of Investor Relations

Bill Higgins - President and Chief Executive Officer

Rob Starr - Chief Financial Officer and Treasurer

Conference Call Participants

Gautam Khanna - TD Cowen

Michael Ciarmoli - Truist Securities

Jan-Frans Engelbrecht - Baird

Operator

Good day, and thank you for standing by. Welcome to the Albany International Corporate Earnings Conference Call [Operator Instructions]. Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, John Hobbs, Director of Investor Relations. Please go ahead.

John Hobbs

Thank you, Jacinda, and good morning everyone. Welcome to Albany International’s second quarter 2023 conference call. As a reminder for those listening on the call, please refer to our press release issued last night detailing our quarterly financial results. Contained in the text of the release is a notice regarding our forward-looking statements and the use of certain non-GAAP financial measures and their associated reconciliation to GAAP. For the purposes of this conference call, those same statements apply to our verbal remarks this morning. Today, we'll make statements that are forward-looking that contain a number of risks and uncertainties, which could cause actual results to differ from those expressed or implied. For a full discussion of these risks and uncertainties, including a reconciliation of non-GAAP measures we may use in this call to their most comparable GAAP measures, please refer to our earnings release of July 26, 2023 as well as our SEC filings, including our 10-Q and 10-K. Now I'll turn the call over to Bill Higgins, President and Chief Executive Officer, who will provide opening remarks. Bill?

Bill Higgins

Thanks, John. Good morning and welcome everyone. Thank you for joining our second quarter earnings call. We're pleased to report another strong quarter of results with revenues of $274 million, up nearly 5% compared to the same period last year and solid execution across our operations. GAAP EPS of $0.86 was down from last year to $1.25 impacted by non-operational items that Rob will cover. Adjusted EPS was $0.90 and adjusted EBITDA was nearly $65 million in the quarter. As a result, we finished the first half of the year in good shape and we're raising our guidance for the full year. The Machine Clothing segment continues to deliver healthy results with revenue growth of 5.6% on a constant currency basis, gross margins in excess of 50% and adjusted EBITDA margins exceeding 37%. Our Machine Clothing team has done an outstanding job navigating the challenges posed by macroeconomic headwinds in Europe and China, inflation and the effects of the war in Ukraine. Since the end of 2022, trends in Machine Clothing's revenues, operating profit and adjusted EBITDA have all been positive and now exceed our prepandemic performance. These impressive results are testament to the effectiveness of Machine Clothing's disciplined operating model, the consumable nature of our products and our well earned reputation as a supplier of mission critical paper machine clothing products with exceptional reliability and value to our customers.