Greetings, and welcome to Matthews International Corporation Third Quarter Fiscal 2019 Financial Results Conference Call. [Operator Instructions] Please note, this conference is being recorded.I would now turn the conference over to your host today, Karen Howard, Investor Relations for Matthews. Please go ahead.

Thank you, Tania, and good morning, everyone. Thank you for joining us to discuss the Matthews International fiscal 2019 third quarter and year-to-date results for the period ended June 30, 2019. We certainly appreciate your time today. You should have a copy of the news release across the wire yesterday afternoon detailing Matthews' results.We also have slides associated with the commentary that we're providing here today. If you don't have the release or the slides, you can find them on the company's website at www.matw.com on the Financial Information page.On the call with me today are Joe Bartolacci, our President and Chief Executive Officer; and Steve Nicola, our Chief Financial Officer. Steve will review the financial results for the quarter and year-to-date and Joe will review the business progress, as well as our outlook for the remainder of fiscal 2019. We will then open the lines for Q&A.But before we do, I would like to highlight our safe harbor statement, which is on Slide 2 of our presentation, as well as within our release. As you are aware, we may make some forward-looking statements during this discussion as well as during the Q&A. These statements apply to future events and are subject to risks and uncertainties, as well as other factors, which could cause actual results to differ materially from what is stated on this call.These risks and uncertainties and other factors are provided in the earnings release and in the slide deck as well as other documents filed by the company with the Securities and Exchange Commission. These documents can be found on our website at www.sec.gov.I also want to point out that during today's call, we will discuss some non-GAAP financial measures, which we believe are useful in evaluating our performance. You should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP. We've provided reconciliations of comparable GAAP to non-GAAP measures in the tables accompanying today's earnings release.And with that, it's my pleasure to turn the call over to Steve to begin. Please go ahead, Steve.

Thank you, Karen, good morning.Consistent with our fiscal 2019 second quarter, there were several significant factors that affected our consolidated sales comparability for the most recent quarter. This included unfavorable changes in foreign currency exchange rates relative to the U.S. dollar, the loss of a significant client account in our U.S. brand business and a decline in U.S. casketed deaths relative to the same quarter a year ago.For the fiscal 2019 third quarter, we reported consolidated sales of $379 million compared to $412 million a year ago. In addition to these three factors, current quarter sales were also impacted by delays in several warehouse automation projects. However, consolidated sales for the current quarter were favorably impacted by sales growth in the private label brand market and higher sales of cremation and incineration equipment in the U.K.With respect to earnings per share on a GAAP basis, the company reported earnings per share of $0.46 per share for the current quarter compared to $0.77 last year. On a non-GAAP basis, adjusted earnings per share were $0.90 for the current quarter compared to a $1.16 last year. These declines primarily reflected the decrease in consolidated sales and higher interest expense.Please turn to Slide 5. On a year-to-date basis our consolidated sales were approximately $1.14 billion compared to $1.2 billion last year, representing a decrease of approximately $50 million. The impact of the previously reported brand client account loss continued slowness in casketed deaths and significant currency headwinds unfavorably affected sales by an estimated $54 million.Although U.S. brand market conditions remain slow in several warehouse automation projects were delayed by customers during the recent quarter, the private label brand business continued to grow, European brand sales increased and sales of cremation and incineration equipment in the U.K. were higher.Year-to-date earnings on a GAAP basis…

Thank you Steve, good morning. Please turn to Slide 16 and I'll update you on our businesses and the market environments. As we indicated in the last quarter fiscal 2019 is proving to be a very challenging year for Matthews and this is evident in our third quarter and year-to-date results. I am proud of our teams for their actions in managing through these challenges including positive ourselves for strength in future years and we remain very focused on growth, improving probability and cash flows.As you may recall the more significant challenges we have been facing resulted from factors beyond our control. As Steve noted the impact of unfavorable currency exchange rates has been a considerable headwind most of which was impacting our SGK Brand Solutions segment. Also U.S. casketed deaths continue to decline resulting in lower casket sales during the quarter versus prior year.Finally, as we mentioned in the past, during the quarter our SGK Brand business felt the impact from the loss of a significant account which transitioned their work internally. Despite these challenges we see positive trends in several of our business units for riding us with encouragement for the remainder of 2019 and beyond.In the meantime we have begun an initiative to rightsize our cost structure focusing on the businesses where revenue growth has been the most challenging. In addition to the operating level, we are evaluating our back office administrative costs especially in light of the efficiencies derived from our implementation of our global ERP which will be completed in the fourth quarter. We are at the early stages of this process and intend to speak more about this initiative when we report next quarter.With that consolidated overview allow me to touch on each of our segments. In our SGK Brand Solutions segment as I…

And I would like to remind our questioners to please limit your time to one question and a follow-up. Thank you.

[Operator Instructions] Our first question comes from Daniel Moore with CJS Securities. Please proceed with your question.

Joe and Steve, good morning. Thank you for the color as well. Wanted to and Joe you dig a good color on brand solutions what you’re seeing there. So maybe it’s beating a dead horse but wanted to drill in a little bit more, obviously year-to-date FX is been a headwind and you had the one client lost, but if we adjust for those how do we think, how are you’re thinking about growth as we look out into fiscal 2020 given the cautionary comments that you are described around the macro and maybe just a juxtapose, kind of what you're seeing in North America versus Europe?

Sure. So when we look at our business for the last nine months, the business is essentially flat on the top line basis as we take out the currency and the loss of our significant account. We have within that mix interesting mixes. So in Europe, we've seen a little better performance, Asia we continue to see a little better performance and in North America we continue to see slowness.However, we do have a couple large accounts and if I use the names you would clearly understand who they are but all you need to do is listen to the recent color on some large CPGs in the beverage industry and you'd understand where I was speaking, we’ve seen good growth in those accounts as they continued to invest in their brands, a lot relaunch products.We have heard from a number of accounts, an expectation that they will reinvest in those brands, in generic brands and continue to grow it. Our expectation next year offer modest growth, because if we don't have that kind of outlook, we've had some account wins, we have had no significant account losses So I would look in North America to be modestly up, Europe and APAC to remain relatively stable on their performances they’ve had in the past. So overall, I would look at SGK to be a modest contributor next year.

Very helpful. On the product ID side, sales are up, typically a good harbinger of industrial activity, maybe just talk about the cadence of orders on demand through the quarter and what you're seeing early in the September quarter?

So on product ID that win for those of you that have been around for a while that's our historical marking products business. That’s the product line that puts the identification markdown products coming down the production line.As we said, our orders particularly in Europe slowed during the quarter but we see strong order rates coming into this quarter as well. So we're expecting a good year from that business overall and we’d had a couple of account wins especially on the consumable side that should bode well for 2020 as well.So we remain bullish. We think it's our solutions in the marketplace continue to convince customers a better product offering than our competitors and we haven’t even launched our new product line yet.

And lastly, and I'll jump out but just - as it relates to the guidance, should we be thinking about your sort of goal/hope is to get to the low end of the range given back you didn't actually change it. I know that there is a lot of variables outside your control but what are your expectations that you look at the rest of the year and quarter? Thanks.

As the guy sitting in a sit, you like everything to fall your way, right. But the fact of the matter is some of these accounts -- some of these projects that we speak though are in the millions of dollars of potential operating profit.So, the probability of each one of those accounts heading and - heading or exceeding our expectations are is probably low, but I would expect those to be beyond our low end of the range at this point in time although Dan I don't know have that kind of clear visibility on the timing of it they are big accounts. So they are big projects that are mission critical often situations for our clients so we'll see.

Our next question comes from Liam Burke with B. Riley. Please proceed with your question.

Joe could give us a little color on Bronze Memorial and if you are seeing any kind of step up in activity taking advantage of the trend and increase cremation?

So as we look at our cremation business it’s growing modestly every year on the - what we would call the ancillary product that will be urns, the mementos and other things associated with that albeit small we've seen good growth this quarter on a year-over-year basis and it’s been a focus for us.So I wouldn’t suggest it is in Bronze memorial itself it is mixed throughout the various parts of that memorialization. So we wouldn't be able to tell you exactly whether it's Bronze or urns on this call at least Liam.

And on your reconciliation on EBITDA you’ve got acquisition costs and ERP integration were two big add backs. How is that trending to the end of the year and do you look at any kind of move into 2020 on those expenses?

So it should be trending us - on the ERP side Liam particularly it should start trending downward. We just completed the last - I’ll call the more significant implementations in our European SGK business. So we should start to see that trailing off as we move out. We do have a couple of smaller ones still ahead of us very, very early in next fiscal year, but again not to the significance that we had. So we are in very much the final stages of that significant implementation.And then same thing on the acquisition cost side. We’re months past the most recent acquisitions so those should be trailing off as well.

The most significant part of those acquisition integration remains the last of the casket factory shutdowns that we're in the process that we speak Liam.

[Operator Instructions] Our next question comes from Gregg Hillman with First Wilshire. Please proceed with your question.

Could you talk about what happened to the segments organic growth during the last session please?

Gregg it's an interesting question because part of our businesses have not been - part of the portfolio 10 years ago. So if we look at Memorialization business as you might expect we expect - we saw modest down shift in mix, but generally a fairly stable business environment and when it comes to our traditional brand business back then, it was relatively stable down modestly, but not collapsing.SGK based on our conversations with the team weather that very well, they were not part of our group at that time so it’s hard for us to tell. I would tell you that warehouse automation business was the most impacted by that their capital spends that slowdown that is smallest part of our business today.

And just one more question Joe. In terms of in your sales for - into the ultra capacitor market or for fuel sales. I think in tooling I think product related tooling, I don’t know like 95% of it. And basically when do you think that could become material and could that ramp up faster than the [indiscernible]?

We indicated during our Investor Day, it is a very, very, very hot market and we are leading provider of tooling in that space. We have interest around the world from a number of players that we're waiting for us - couple to pull triggers on. We have a significant contractors in the works right now that is a proving ground for the solution and we expect to see some of those results next year.So I mean that's - now again we are billions, [5 billion six] companies that can move the needle that materially next year most likely not. But it will be a growing opportunity for us for years to come as that market continues to expand.

We have a follow-up question from Daniel Moore with CJS Securities. Please proceed with your question.

Thank you again. Just update on how you're thinking about capital allocation obviously bought back decent amount of stock in another 240,000 shares this quarter. Maybe just given - where the stock is trading today relative to your cash generation, your comfort level with maintaining current leverage ratios I mean how you're thinking about the fee weighing, leverage reduction, debt reduction versus investing in your own stock?

Dan yes, so the fourth fiscal quarter tends to be - the seasonally our strongest quarter with respect to earnings and cash flow. So debt reduction, reduction in our leverage ratio remains a priority. So I expect that we will be paying down some debt during the quarter but also given the strong cash flow, I would also expect us to be and the stock price for us to be in the market as well.

Thank you. At this time, there are no further questions. I would like to turn the call back over to Ms. Howard for closing comments.

Thank you, Tania. We appreciate everyone’s participation this morning. As always thank you for your interest in Matthews. We look forward to updating you on our fourth quarter and fiscal year-end 2019 results in November. Thank you and have a great day.

Thank you. This does conclude today's teleconference. You may disconnect your lines at this time, and have a great day.