Mayville Engineering Company, Inc. (NYSE:MEC) Q3 2024 Results Conference Call November 6, 2024 10:00 AM ET

Company Participants

Stefan Neely - Vallum Advisors, IR
Jag Reddy - President and CEO
Todd Butz - Chief Financial Officer

Conference Call Participants

Mig Dobre - Baird
Ted Jackson - Northland Securities
Natalia Bak - Citi

Operator

Good morning. Thank you for attending the Mayville Engineering Company Third Quarter 2024 Earnings Conference Call. My name is Bridget, and I'll be your moderator today. All lines will be muted during the presentation portion of the call with an opportunity for question-and-answers at the end.

I'd now like to pass the conference over to your host, Stefan Neely, with Vallum Advisors. Thank you, Stefan. You may proceed.

Stefan Neely

Thank you, operator. On behalf of our entire team, I'd like to welcome you to our Q3, 2024 results conference call. Leading the call today is MEC's President and CEO, Jag Reddy; and Todd Butz, Chief Financial Officer.

Today's discussion contains forward-looking statements about future business and financial expectations. Actual results may differ significantly from those projected in today's forward-looking statements due to various risks and uncertainties, including the risks described in our periodic reports filed with the Securities and Exchange Commission. Except as required by law, we undertake no obligation to update our forward-looking statements. Further, this call will include the discussion of certain non-GAAP financial measures.

Reconciliation of these measures to the closest GAAP financial measure is included in our quarterly earnings press release, which is available at mecinc.com. Following our prepared remarks, we will open the line for questions.

With that, I would like to turn the call over to Jag.

Jag Reddy

Thank you, Stefan, and good morning, everyone. Thank you for joining us today. During the Q3, we continued to advance our strategic priorities despite a marked near-term deceleration in customer order activity. This demand softening materialized at the beginning of August as customers took destocking actions to manage their high levels of dealer inventory.

In response to the shifting demand conditions, we introduced a series of cost rationalization initiatives during the Q3. This includes the reduction of production days, a 12% reduction in our labor force, the decision to permanently close our Wautoma facility in the 4th quarter and other cost reduction actions. The combination of these items are expected to result in an estimated $600,000 of restructuring expenses in the Q4 and $1 million to $3 million in annualized cost savings.