CTS Corporation (NYSE:CTS) Q2 2022 Earnings Conference Call July 26, 2022 10:00 AM ET

Company Participants

Kieran O'Sullivan - Chairman, President and Chief Executive Officer

Ashish Agrawal - Vice President and Chief Financial Officer

Conference Call Participants

Justin Long - Stephens Inc.

Jon Franzreb - Sidoti & Company

Joshua Buchalter - Cowen

Hendi Susanto - Gabelli Funds

Operator

Good morning. My name is Bailey and I will be your conference operator today. At this time, I would like to welcome everyone to the CTS Corporation Second Quarter 2022 Conference Call. All lines have been placed on mute to prevent background noise. A supplemental slide presentation to accompany the prepared remarks can be found on the company's website. After the speakers' remarks, there will be a question-and-answer session. [Operator instructions]

At this time, I would like to turn over the call to Mr. Kieran O'Sullivan, CEO of CTS Corporation. Mr. O'Sullivan, you may begin your conference.

Kieran O'Sullivan

Thanks, Bailey. Good morning and welcome everyone to our second quarter 2022 earnings call. We delivered another strong quarter. In addition, we finalized the acquisition of Ferroperm Piezoceramics at the end of June, further advancing our diversification strategy. I'm excited to have this talented team join CTS, which will allow us to expand our market opportunities and support a broader range of customers. Sales in the second quarter were $145 million, up approximately 12% compared to the second quarter of 2021.

Second quarter adjusted gross margin was 36.1%, down 70 basis points from 36.8% in the second quarter of last year. Adjusted EBITDA margin of 22.4% was up 90 basis points from 21.5% in the same period last year. Second quarter adjusted earnings per diluted share of $0.62 were up almost 20% from $0.52 in the second quarter of 2021. As I already mentioned, during the quarter, we completed the Ferroperm acquisition, the acquisition is expected to be accretive in 2023.

Ashish will take us through the Safe Harbor Statement. Ashish?

Ashish Agrawal

I would like to remind our listeners that this conference call contains forward-looking statements. These statements are subject to a number of risks and uncertainties that could cause actual results to defer materially from those expressed in the forward-looking statements. Additional information regarding these risks and uncertainties is contained in the press release issued today. And more information can be found in the company's SEC filings. To the extent that today's discussion refers to any non-GAAP measures under Regulation G, the required explanations and reconciliation are available in the Investors section of the CTS website.