Encore Wire Corporation (NASDAQ:WIRE) Q3 2023 Earnings Conference Call October 25, 2023 11:00 AM ET

Company Participants

Bret Eckert – Executive Vice President and Chief Financial Officer

Daniel Jones – President, Chief Executive Officer and Chairman

Conference Call Participants

Christopher Moore – CJS securities

Brent Thielman – D.A. Davidson

Eric Marshall – Hodges Capital

Julio Romero – Sidoti & Company

Operator

Thank you for holding. And welcome everyone to the Encore Wire Corporation’s Third Quarter 2023 Earnings Call. [Operator Instructions] Thank you.

We’ll now turn the call over to Bret Eckert. Mr. Eckert, please go ahead.

Bret Eckert

Thank you. Thank you, Jack. Good morning. And welcome to the Encore Wire Corporation quarterly conference call. I am 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.

Before we begin our comments we would like to remind everyone that today’s earnings release and certain of our comments on the call include forward-looking statements. And actual results may differ materially from such forward-looking statements. I would like to refer everyone to the cautionary language included in our earnings release and too the risk factors described in our SEC filings.

I will now turn the call over Daniel for some opening remarks. Daniel?

Daniel Jones

Thank you, Bret. And thank you, Jack. Good morning, everyone and 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 tenth consecutive quarter of elevated margins to spot our continued belief that we are in the midst of a 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 have invested heavily and continue to invest in improving our service model and efficiency levels to reduce costs, increase capacity and deepen vertical integration, which we believe should contribute to achieving sustained higher gross margin levels when compared to pre-COVID baselines.

With respect to volume, I am pleased to have shipped a record number of copper and aluminum pounds in the third quarter. These results demonstrate a dynamic shift in volume shift when compared to a pre-COVID baseline. Copper and aluminum pounds shipped in the third quarter of 2023 increased by 21% and 96%, respectively, when compared to the third quarter of 2019.