Ladies and gentlemen, thank you for standing by and welcome to Calgon Carbon's Third Quarter 2015 Earnings Conference Call. At this time, all participants have been placed in a listen-only mode and the floor will be opened for your questions following the presentation. [Operator Instructions] It is now my pleasure to turn the floor over to Dan Crookshank, Director of Investor Relations. Please go ahead, sir.

Thank you, Lori. Good morning everyone and thank you for joining us for today's conference call. Our main speakers today are Randy Dearth, Calgon Carbon's Chairman, President and Chief Executive Officer; Bob O'Brien, our Chief Operating Officer; and Steve Schott, our current Senior VP and Chief Financial Officer. Also joining us today is Jim Coccagno, our current Senior Vice President of Asia Global Procurement and Strategic Initiatives and Bob Fortwangler, our current Vice President of Finance. Before we begin, I would like to remind you that today's presentation as well as the additional comments that Calgon Carbon Executives will make during the Q&A portion of this call may contain statements that are forward-looking. Forward-looking statements are subject to risks and uncertainties and Calgon Carbon's actual results may differ materially from those expressed in such forward-looking statements. A list of factors that could affect Calgon Carbon's actual results can be found in the news release that we issued earlier this morning and are discussed more fully in the reports we filed with the Securities and Exchange Commission, particularly in our last Annual Report on Form 10-K. These filings, as well as this morning's news release, can also be found on the Investor Relations page of our website. With that, I'll now turn it over to Randy for his initial comments on the quarter and recent business developments.

Thanks, Dan, and good morning everyone. Before we get started with the results for the quarter, I'd like to briefly recap several senior management announcements that we made recently. I would like to start by congratulating Bob O’Brien on his retirement decision. We are greatly indebted to Bob for his many contributions to Calgon Carbon at his 42 year carrier. The impact of those contributions will continue to be evident as we move forward and I’m happy to report that Bob has agreed to console with Management of the Company for approximately 18 months after he officially retires in April. This is going to allow for very smooth operational transition. Thanks Bob. In implementing this transition, we believe that instead of one-to-one replacement for Bob, we have two successors with two distinct focuses which I will discuss with more detail later. Under Bob's tutelage, these two gentlemen have both gained extensive knowledge and experience and have established proven track record. With that, I would like to congratulate and welcome Jim Coccagno, our recently appointed Executive Vice President of our new Core Carbons and Services Division. And would like to congratulate Steve Schott, who will be participating on his last earnings call as our CFO but will return next year in his new role as Executive Vice President of our newly formed Advanced Materials Manufacturing and Equipment Division. I also want to welcome and congratulate Bob Fortwangler, who effective on January 1, 2016 will be our Chief Financial Officer. Neither, Jim Coccagno or Bob Fortwangler will have a formal speaking role today, but they will be available participating in the Q&A at the conclusion of our remarks. So moving on I'm going to start by commenting on our third quarter financial results compared to the expectations we communicated last quarter, and…

Thanks Randy, good morning everyone. Total sales for the third quarter of 2015 were $133 million versus $137.7 million in the third quarter of 2014, a decrease of $4.7 million or 3.4%. Due to the stronger U.S. dollar in the current year, translation had a negative impact of $5.9 million for the third quarter of 2015 primarily on sales in the activated carbon and service segment. Regarding our segments, sales in the activated carbon and service segment decreased $3 million, or 2.4% for the third quarter of 2015 compared to 2014's third quarter. The decrease in sales was principally due to the $5.8 million impact from foreign currency translation. Excluding the currency translation impact, segment sales increased by $2.8 million. Sales in the Environmental Air market increased by $12.3 million due mainly to the higher sales of powder activated carbon from mercury removal. This increase was mostly offset by lower sales in other market areas. Potable water market sales were lower primarily in the Americas region due to several large orders from last year that did not repeat and lower demand including the impact of adverse weather conditions. Sales were also lower in the food and environmental water markets due to certain non repeat orders and in the specialty carbon market due to the continued lower demand for respirators from the U.S. government. Moving to the equipment segment, sales decreased $1.1 million or 10.6% in the third quarter of 2015 versus the comparable 2014 period. The decrease was primarily due to lower sales of balanced water treatment systems, as well as lower demand for carbon absorption equipment systems due to a decline in project related discretionary spending by certain industrial customers and lower disinfection by product related equipment equity in the potable water market. These decreases were partially offset by…

Thank you, Steve. Now we'll hear from Bob O’Brien for the operations review

Good morning, everyone. Let me start my providing an update on the regulatory front. First on the MATS regulation. As we discussed last quarter, MATS now lies in the hands of the U.S. Court of Appeals for the District of Columbia Circuit. And following a time table outlined by the court, the parties submitted motions in late September, responses to the motions on October 21, and replies to the responses were to be filed yesterday November 4. We expect the court to issue a ruling within the next month or so without holding any additional hearings. As expected, the EPA's motions requested that the court remanded rule back to the agency to appropriately consider cost without vacating it thus leaving the rule in effect. Based on the work, it is already completed on the documentation of cost throughout the entire rule making process, EPA has stated that it believes it is "at least a serious possibility" that we will be able to substantiate its decision to establish the MATS regulation in a manner required by the U.S. Supreme Court's June 2015 decision, Michigan versus the EPA. Considering this and analogous case law precedents, we continue to believe the decision by the court that keeps the rule in place while remanding it to the EPA is a reasonable possible outcome. In the meantime, power plants for April 2015 MATS compliance state are continuing to eject private carbon in order to major requirements of the regulation. Additionally, the vast majority of those plants require to comply at April 2016 are well advanced in their planning. This includes capital investments for PAC feed systems, testing and evaluation of private carbon products, and the issuance or request for quotes on these products. As we have previously mentioned, we continue to expect our 2015 sales…

Thanks Bob. Now we'll go back to Steve for the fourth quarter outlook.

Thank you Dan, let me start with revenue. We expect revenue for the fourth quarter to decline sequentially from the third quarter by several million dollars. The sequential negative FX impact is estimated to be approximately equal at $6 million. Mercury control revenues are expected to be lower by $5 to $10 million sequentially due to seasonal requirements of our power plant customers with most of our other America’s business unit showing improvement. This includes higher revenues in municipal water and slightly higher industrial and food market revenues reflecting our expectation that economic weakness in these markets continues with some modest improvement. We expect depreciation and amortization - we expect predepreciation and amortization gross margins to be approximately 34% due to primarily to a less favorable sales mix in the fourth quarter as compared to the third quarter. We expect our depreciation and amortization expense as well as selling, general and research related operating expenses to be comparable sequentially. We expect other income and expense net to be more in line with our first and second quarter results of approximately $500,000 net expense. And finally, we expect our effective income tax rate to be approximately 33%. Now, I’ll turn it back over to Randy for some final thoughts.

Thanks Steve. In closing I would like to discuss two final topics, our cost reduction program and our new organization. We continue to make progress on our cost reduction initiatives. In October, we completed the warehouse consolidation in China that will provide annual savings of approximately $800,000 which are contemplated in our previously announced cost improvement program. Through the end of 2015, we will have achieved approximately two thirds of our $50 million program. We continue to expect to achieve the remaining third of the targeted savings over the next two years. Now let’s talk about our new structure. To remind you, the new core carbon and services division to be led by Jim, includes the oversight of our traditional carbon, industrial and municipal markets in the U.S. which also include reactivation, as well as our activities in the Asian and LatAm regions. The advance materials manufacturing and equipment division to be led by Steve will include our specialty carbon business in the U.S. and the global UV technologies business unit, as well as activities in the European region that operate under the name Chemviron Carbon. He will also have oversight of our virgin activated carbon equipment and manufacturing capabilities. The structure is expected to do a number of things. It will enhance the successful North American business unit structures by combining the management of these areas with reactivation until the service activities that will allow a continued unified push of our full service model. It retains our current regional structures but defies our leadership which we expect will increase our focus in each region to accelerate our global expansion and growth strategy. It also improves overall asset utilization in investment through a sharper focus on optimization of working carbon and reactivation capacity in the way we provision equipment to customers. In total, we believe we will provide a better opportunity for Calgon Carbon to succeed in executing our growth strategies, improving our profitability and creating incremental shareholder value. Let me conclude today by saying that despite the softness we are currently seeing in certain of our end markets, I continue to be excited about the opportunities for future growth to Calgon Carbon. This includes areas where we are already established such as mercury removal and municipal water treatment solutions, as well as executing strategies which include acquisitions to expand our product portfolio and increase our global presence. I believe the combination of our strong balance sheet and expected solid cash flows will enable us to fuel this growth, while at the same time allow us to continue returning value to shareholders. We'll now take your questions.

[Operator Instructions] Your first question comes from the line of Ben Kallo of Robert Baird.

Hi guys, this is Dave for Ben. I was wondering if you guys could talk a little bit more about the MATS ruling and where you seeing that going. I know you guys are - really talked about this a lot but if you could just add little more clarity there about some color and what we should expect, how we should model that.

This is Bob, as I mentioned the ruling is now in the hands of the Court of Appeals in Washington D.C. So we can only - I think state what we already have, we know the Court has all the information now that they are going to consider and so we think that within April 2016 deadline ahead for many power plants that were granted one year extension, with that in mind we think the decision from the Court will be made relatively quickly, we estimate before the end of the year, next month or two. We have reason to believe based on some EPA statements and we are hopeful that the Court will remand the decision back to the EPA to complete their cost analysis but keep the regulation in affect. And so that’s our expectation but obviously there are no guarantees when it comes to what the court will actually do.

Okay. Thank you.

[Operator Instructions] At this time there are no further questions. I’ll now turn the call to Dan Crookshank, for any additional or closing remarks.

Thank you, Lori. I just like everybody to know that our 10-Q will be filed tomorrow and myself and the Management team will be available for call - to follow up the call. Thank you. Back to you, Lori.

Thank you. That does conclude today's Calgon Carbon's third quarter 2015 earnings conference call. You may now disconnect and have a wonderful day.