Good morning and welcome to the CPI Card Group Fourth Quarter and Full Year 2019 Earnings Webcast. All participants will be in listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Jennifer Almquist, Investor Relations. Please go ahead.

Thanks and good morning everyone. Welcome to the CPI Card Group fourth quarter and full year 2019 earnings webcast and conference call. On the call today from CPI Card Group is Scott Scheirman, President and Chief Executive Officer; and John Lowe, Chief Financial Officer. Before we begin, I would like to remind everyone that this call may contain forward-looking statements as they are defined under the Private Securities Litigation Reform Act of 1995. These statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. For a discussion of such risks and uncertainties, please see CPI Card Group’s most recent filings with the SEC and on SEDAR. All forward-looking statements made today reflect our current expectations only and we undertake no obligation to update any statement to reflect the events that occur after this call. Also during the course of today’s call, the company will be discussing one or more non-GAAP financial measures, including, but not limited to, EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted free cash flow, net sales growth excluding Canadian operations and operating margin, excluding litigation settlement gains, all reported on a continuing operations basis. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures are included in the press release or slide presentation we issued this morning. Please be advised that the financial results discussed on the call today reflect continuing operations and therefore exclude the results of CPI’s UK Limited segment, which was divested on August of 2018 and has been accounted for as discontinued operations in accordance with U.S. GAAP. The disposition of the CPI Canada business closed on April 1, 2019 and does not qualify as a discontinued operation in accordance with U.S. GAAP. Results for the Canada business through the date of disposition as well as the disposition related costs are reflected in the other segment. Copies of today’s press release as well as the presentation that accompanies this conference call are accessible on CPI’s Investor Relations website, investor.cpicardgroup.com. In addition, CPI’s Form 10-Q for the year ended December 31, 2019 was recently filed with the SEC and is available on CPI’s Investor Relations website. Please note that this call will conclude after our prepared remarks. And now, I would like to turn the call over to Scott Scheirman, President and Chief Executive Officer of CPI.

Thanks Jen, and good morning everyone. Thank you for joining us today. Before I begin, I would like to take a moment to address the devastating tornadoes in the Nashville area last week, where we have operations. We are grateful that our employees are safe, although some were impacted by the storm. Our thoughts and prayers are with the people of Nashville as they rebuild and recover. I will begin my prepared remarks on Slide 4. We delivered strong results in the fourth quarter and full year 2019. We believe we have gained market share across all business units in 2019 as we increased net sales and significantly improved our bottom line results by focusing on our customer-centric strategy. During the fourth quarter, we delivered a net sales increase of 6% or 9% when excluding the Canadian business that was sold in the second quarter. For the full year, net sales increased 9% or 12% excluding Canada. This is on top of the double-digit year-over-year increase in net sales we delivered in 2018 as our strategies and crisp execution are delivering strong results. Net loss improved 71% for both the fourth quarter and full year. Adjusted EBITDA increased 74% year-over-year for the fourth quarter and increased 39% year-over-year for the full year. Turning to Slide 5. 2019 was a year of growth through targeted initiatives. Our achievements in 2019 are a testament to our steadfast focus on being a partner of choice by providing market leading quality products and customer service through a market competitive business model and crisp execution of our four strategic priorities. First, through our deep customer focused strategy, we strive to be the trusted partner in payments by exceeding the expectations of our customers through high-quality and collaboration and delivering differentiated and innovative products and solutions.…

Thanks, Scott. Good morning, everyone. I will begin my overview of our results from the fourth quarter and full year 2019 on Slide 10. As a reminder, 2018 comparative results are on a continuing operations basis and excludes the UK business, that was divested and reported as a discontinued operation during 2018 as required by U.S. GAAP. The April 2019 disposition of our Canadian business did not qualify as a discontinued operation under U.S. GAAP; and therefore, the results from this business are included in the other segment. We delivered strong sales growth in the fourth quarter and full year 2019. Net sales were up 6% and 9% year-over-year for the fourth quarter and full year respectively. Excluding the impact of the divested Canadian business, net sales increased 9% in the fourth quarter and 12% for the full year. 2019 top line results were driven by sales of higher-priced dual interface EMV cards, including Second Wave and strong performance in personalization, including Card@Once. Fourth quarter gross profit was $22 million, up 5% year-over-year and gross margin was 30.3%, directionally the same as the year ago fourth quarter. For the full year 2019, we generated gross profit of $91.3 million, up 16% compared to 2018. We also expanded gross margins by over 200 basis points year-over-year from 30.7% in 2018 to 32.8% in 2019. Gross margin expansion in 2019 was driven by higher net sales in our U.S Debt and Credit segment, creating greater leverage of our operating model, a smaller geographic footprint having consolidated our personalization facilities from 3 to 2 and divested our non-core business in Canada and a more favorable product mix in 2019. During the fourth quarter, we reported income from operations of $3.9 million compared with a loss from operations of $0.4 million in the fourth…

Thanks, John. In wrapping up, I want to thank all of our employees for their commitment and dedications delivering excellence and serving our customers well. The results from this focused hardware underscore my confidence in our ability to continue to execute well for our customers and all of our stakeholders in 2020 and beyond. With the success we have had over the last 2 years first in getting the company ready for growth and then growing through targeted initiatives, I believe we are well-positioned to embark on our next stage of scaling our solutions, diversifying our products and expanding our customer base through continued crisp execution on our key strategies. I look forward to updating you on our progress. Operator, you may now end the call.

The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.