Good morning. My name is Steve, and I will be your conference operator today. At this time, I would like to welcome everyone to the Rogers’ First Quarter 2014 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. (Operator Instructions) Thank you. President and CEO, Bruce Hoechner, you may begin your conference.

Thank you, Steve. Good morning, everyone. Thanks for joining us today. The slides for today’s call can be found on the Investors section of our website along with the news release that was issued yesterday. With me today are Dennis Loughran, Vice President, Finance and Chief Financial Officer; and Bob Daigle, Senior Vice President and Chief Technology Officer. I will now turn it over to Dennis to dispense with the formalities. Dennis?

Thank you, Bruce. I would like to point out to all our listeners that statements in this conference call that are not strictly historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and should be considered as subject to the many uncertainties that exist in Rogers’ operations and environment. These uncertainties include economic conditions, market demands, and competitive factors. Such factors could cause actual results to differ materially from those in any forward-looking statement. Also, the discussions during this conference call will include certain financial measures that were not prepared in accordance with Generally Accepted Accounting Principles. Reconciliation of those non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in the slide deck for today’s call that can be found on our website’s Investors section. I will now turn it back over to Bruce.

Thank you, Dennis. I’m very pleased to share with you today Rogers’ first quarter results for 2014. Over the past two years, we have reported on the transformational efforts. We’ve undertaken to deliver greater value to our customers, shareholders, and employees. Those activities together with growth in our key markets have helped us realize positive results in recent quarters. Today, I’m pleased to say that the momentum we saw in the last half of 2013 clearly carried forward into the first quarter of 2014. In Q1, Rogers set a first quarter sales record, achieving $146.6 million in net sales, which is an increase of 16.4% over quarter one 2013. I would like to take a moment to recognize the all-time revenue record quarter our Printed Circuit Materials division achieved. This was a simply outstanding performance that I will discuss in greater detail shortly. In addition, as a company, we achieved earnings of $0.79 per diluted share, a 102.5% increase over our Q1 2013 performance. This comparison as well as those that follow, are to the prior period’s non-GAAP measures, which excludes special charges. We also demonstrated continued improvement in our gross margins moving to 36.8% from 32.8% in Q1 2013, driving our overall operating margins to 14.6% from 8.6% in Q1 2013. Dennis will share more with you in detail on our financial performance in a few minutes. Overall, we are very encouraged by our performance and realized more opportunities while ahead. We attribute our Q1 results to increase demand in our megatrend categories of Internet connectivity and clean energy, as well as substantial sales increases in safety and protection applications. In particular, we saw orders increase for applications in telecom infrastructure, variable frequency motor drives, and automotive safety sensors. Growth in these key categories in combination with our cost…

Thank you, Bruce and good morning again, to everyone. As reported in the press release, we achieved earnings from continuing operations of $0.79 per diluted share that result for those $0.08 or 11% above the midpoint of the range. Sales for the quarter came in at $146.6 million, well above our guided range and more importantly 16.4% better than last year’s first quarter. The combination of stronger sales and higher production produce better-than-expected gross margins at 36.8%, higher commercial expenses primarily related to increased incentive and equity compensation required environmental accruals and higher professional services offset some of the margin gains. However, we were still able to deliver a significantly improved operating profit as a percent of sales at 14.6%. That performance, as compared to previous non-GAAP results, is 500 basis points higher than the first quarter of 2013, 209 basis points better than the fourth quarter of 2013 and 142 basis points better than the midpoint of our guidance for the quarter. It also represents the best performance in the last two years and reflects the benefit of our profit improvement efforts which began in 2012. A portion of that improvement is due to our continued focus on better operating efficiency as we grow sales, which we accomplished in the quarter with top line of $20.7 million or 16.4% in comparison to last year’s first quarter. We also achieved net sustainable SG&A cost reductions in the quarter, totaling approximately $3.2 million, resulting from profit improvement efforts undertaken in 2013. Overall, our operating profit increased by $9.4 million, as compared to non-GAAP profit for the first quarter of 2013 or a 78% increase. On Slide 8, our gross margins and operating profit percentages for the last five quarters are depicted. gross margin was 36.8% for the first quarter of 2014,…

Thanks, Dennis. and this concludes our prepared remarks. We will now open up the call for questions.

(Operator Instructions) Our first question comes from the line of Dan Moore with CJS Securities. Your line is open. Daniel Moore – CJS Securities, Inc.: Good morning and congratulations. Obviously, it was a very strong quarter.

Thanks, Dan. Daniel Moore – CJS Securities, Inc.: As you mentioned, obviously Q1 revenue came in well above your guidance range. Wondering if there’s any way to tell how much of that may have been a little bit of pull forward from Q2 versus just really stronger demand across the board in your end markets?

I believe the answer is stronger demand across all the end market, we don’t – I don’t believe I saw any reports where there were some – any usual quarter-end go forward.

And Dan, the way we’re looking at this and I was just out in Asia and Europe, we’re seeing demand in the PCM area and 4G/LTE to continue certainly in Q2. And when we look at the build-out, particularly in China, but also we’re seeing it in North America as well. We anticipate throughout the year that we see strong 4G/LTE build-out, which of course, propels us in the base station, as well as the intended systems. Daniel Moore – CJS Securities, Inc.: Excellent. And then, Dennis, you mentioned the gross margin outlook for Q2, that there was a mix issue, which was sort of isolated. Can you elaborate on that at all, and what gives you confidence that gross margins will start to return to expansion as we look into back half of the year?

Yes. the second quarter is basically, we have three major business units that all have different contribution margin profiles. In the second quarter, we have ACM that is up only slightly, we have our PES business that is growing fairly substantially, and HPF’s guidance is slightly down versus their first quarter. At that contribution margin profile, we achieve a slightly lower average gross margin, the underlying profitability of these two business units is as strong as ever, which gives me the confidence that has the growth profile averages out over the year, we returned back to levels we see. Daniel Moore – CJS Securities, Inc.: Very good. And then maybe just looking at kind of more globally, you’ve talked about obviously, the three megatrends. It is clear recently that Internet connectivity and clean energy are maybe pulling ahead of the pack a little bit As you look forward, particularly given the strength in automotive, is it maybe more – and more generally safety systems – is it more of a four-legged growth engine? And maybe just talk a little bit about the outlook for mass transit and if you expect that to continue to start to pick up again through the remainder of the year?

Okay. let me – Dan, let me address the automotive side. We participate in a number of different ways in automotive. we have the safety radar, the blind spot detection, the adaptive cruise control and that continues to grow at very high rates for us. Auto radar in the first quarter was up 37% for us. Also we see a continued strength in the x-by-wire and this is in our Curamik product line, particularly in the power modules as we see internal combustion engines, the systems that had historically been driven by the fan belts and mechanical systems like power steering, air-conditioning and so forth, a lot of transition there to electrical systems, which of course the Curamik direct bonded copper is used in. We also, in the clean energy area, see a lot of benefits moving forward in EVs, particularly in the United States where one of the leading manufacturers in the electric vehicles continues to grow rapidly. but also while I was in China, I visited a manufacturer there and there’s a lot of demand right now in China for alternative energy cars. So HEV, EVs and we’re participating quite aggressively there with our power modules in their designs. That’s being driven quite frankly by the government mandating levels of alternative energy vehicles, because of the environmental concerns that they have going on there. And we also, in with HPF, see our foams being used in the EVs and HEV automotive space, particularly in the battery separators and that continues to grow for us. So that’s a very strong segment for us. it covers essentially all of our major businesses. And I think the other side in mass transit; we’re starting to see some pickup in locomotive demand. We saw that with our RO-LINX bus bars, some new orders coming in. We anticipate throughout the year, we see some recovery there. And we also continue to see with our BISCO silicone foams, materials being used in some of the major – by some of the major aircraft manufacturers for sound deadening effect also for insulation effect and so forth. So, across-the-board, we are starting to see some pick-up also in the mass transit. It certainly won’t be like what we are seeing in 4G LTE, but it’s certainly moving in the right direction. Daniel Moore – CJS Securities: Thank you for the color. I’ll get back in queue.

Sure. Thanks, Dan.

Thank you. And our next question comes from the line of Avinash Kant with D.A. Davidson & Co. Your line is open. Avinash Kant – D A. Davidson & Co.: Good morning, Bruce, Dennis, and Bob.

Good morning.

Good morning. Avinash Kant – D A. Davidson & Co.: A few questions, the first one on that you did see very strong growth in the clean energy side and you talked a little about the EV/EDV, could you give us some idea what percentage of your revenue in this segment are coming from EV/EDV versus the wind and other segments all, maybe if you could quantify that maybe more in terms of growth what percentage of growth is coming from this segment?

What we’ve seen is some significant pick-up in the clean energy particularly in variable speed motor drives. We were up 19% and that’s in our PES business. So we are seeing that continuing to come forward. And also in solar power modules, we were up 83% there year-on-year. In terms of the breakout, we don’t necessarily have that breakout here, but certainly that’s something that we can look into. Avinash Kant – D A. Davidson & Co.: Would you say that EV/EDV is bigger portion of this compared to other segments, other business segments?

Yes. Well, I would say certainly going forward, we expect EV to be a strong growth driver for us as we see the increase in the adoption of electric vehicles. We saw in terms of growth, it was 4% growth in Q1 2014, over Q4 2013. So, it’s nominal growth, but I can tell you what we are hearing is that, we will see some substantial growth going forward. Avinash Kant – D A. Davidson & Co.: And in terms of margins, of course, you would say a little bit about Q2, how should we think of normality of margins coming in into Q3, which tends to be seasonally one of the better quarters for you?

So when we just comment on that and talk a little bit about strategically where the company is going. We set our targets for margins both gross margin and operating margin at 40% for gross, 15% for operating, and we made, I think great progress over the last year and a half or so. What we are seeing as we move into Q2, things are not necessarily straight line, I mean, Dennis mentioned some of the mix we have certainly higher sales, nice growth in PES, which tends to be a lower gross margin business. We have some flatness in HPF. As we go into Q3 and we anticipate HPF recovering during the course of the year here. We should see and we expect to see margins bouncing a little bit up on that. But again, things don’t necessarily go in a straight line. On the bottom line on the operating margin side, we are making some investments in Q2 in marketing and R&D that are month some in a sense that has – that we think has to be made. And so that affects us a little bit negatively on the operating margin in Q2. Avinash Kant – D A. Davidson & Co.: And final question, on the 4G LTE, could you give us some idea of how big it is that the sales that I exposed to 4G LTE how big are they and in which inning are we in terms of growth in the 4G LTE at this point?

Well, I will answer your – the second part of your question first. I think we’re in about a two to three-year trend here with 4G LTE, we’ll continue to be built out. I mean there is a lot of data that we hear from our sources in terms of additional capital investment in China, but we’re also seeing that investment coming in the U.S. AT&T, Sprint, some others are being pressured because of the need for greater bandwidth, greater download capability to expand as well. So we see this as a multiyear expansion and that strength will certainly continue. We see that also power amps are about 57% of PCM. And we’ll continue to see that ramp up, but of course, within PCM, we also see the blind spot and adaptive cruise control growing very substantially as we continue to see adoption there as I mentioned earlier 37% year-on-year, and we see that continuing. Avinash Kant – D A. Davidson & Co.: Thank you so much, Bruce.

Thank you. And your next question comes from the line of Jiwon Lee with Sidoti & Co. Your line is open. Jiwon Lee – Sidoti & Co. LLC: Thank you. Good morning.

Good morning. Jiwon Lee – Sidoti & Co. LLC: Bruce, could you level it a little bit more about this – the mobile device connectivity with one OEM and whether or not that has some potential to spread?

Well, we’re working very diligently to continue to talk with folks in the market to see the applications and to understand whether there is other opportunity. There has been a lot of work ongoing with multiple OEMs in this area, and this is all about improving Wi-Fi performance of the mobile internet devices, whether it gets adopted more broadly, we’re in a lot of evaluation right now, so it’s too early to say. Jiwon Lee – Sidoti & Co. LLC: Okay. And then in terms of the EV, previously you have given us some type of a, I guess, your dollar content into the unit. I wonder whether that has sort of kind of grown a little bit, or is that just more function of some of the OEMs’ own growth?

Well, certainly the OEM is – the OEMs are growing, one in particular, and so we continue to move along with them. We have, I would say, about the same content that we’ve been talking about per car. And we continue to evaluate and look at other opportunities as some of the designs change. We also have opportunities for some greater penetration. So it’s a moving target, but very progressive in the sense that it’s the growth of models, sales of units, I should say is continuing quite steadily. Jiwon Lee – Sidoti & Co. LLC: Okay. And then the China’s investment, anticipated investment in the mass transit again, how do you expect that to trickle down to you?

Well, again in high-speed rail and freight locomotives and so forth, that’s where we see the applications, it’s primarily in our RO-LINX bus bar business segment, or I should say product line. and so that’s what we’ll see it most clearly. Jiwon Lee – Sidoti & Co. LLC: And then lastly from me, in terms of your 2014 $25 million CapEx, there should be some delta in it. In what product lines do you particularly see the potential upside for the investment needs this year?

Well, certainly we’re continuing to make investments in our PCM business. we just started up a new treater in China. we’re looking at putting in more laminating capability into China and actually elsewhere. We also continue to be bottleneck that business across the world in our locations in Asia – in Asia, Arizona, as well as in Belgium. So we’ll see some increased CapEx there. We’ll also continue as we see increases in the demand for RO-LINX. We’ll continue to see some capital investment there, as well as some capital investments going forward in the Curamik product line and we’re looking at Asia for that as well. Jiwon Lee – Sidoti & Co. LLC: Okay. very good, thank you.

Thanks.

Thank you. (Operator Instructions) Our next question comes from the line of Dan Moore with CJS Securities. Your line is open

Hi, Dan. Daniel Moore – CJS Securities, Inc.: Thank you, again. In HPF, you mentioned you expect to see perhaps, a better growth in the back half of the year. Maybe talk a little bit about the – some of the design changes, whether we are sort of recycling against those sort of more difficult comps by Q3 and Q4, and how you expect maybe those impacts could dissipate and some of the other growth drivers within that segment to pick up the slack?

Certainly, and then we’ve talked about this over the last few quarters. the transition away from some of the gasketing, the foam from gasketing materials for the displays, particularly in the tablets going to non- gasket. And so that continues to occur and I think our sense is that we’ve pretty hit bottom on that. Our belief is that going forward, we are looking at other opportunity areas and in particular, growth in consumer, in sports, high impact sports apparel and helmet systems and so forth and we’ve had excellent take up there. we’ve seen that 13% growth year-on-year in our XRD products and we have a lot in the pipeline in terms of design. We’re also continuing to look at developments of new products in transportation, and this is in aircraft, as well as in rail and also in EV. There’s some special needs that each of those areas have that are addressed very well by our – both BISCO and PORON product lines. And then in general industrial, our play there is really looking more at geographical expansion, specifically in Europe. We’ve upgraded and added to our sales and marketing capabilities in Europe over the last six months and so we continue to make investments there in our capabilities. And we believe that there’s certainly some upside there for us in general industrial. So overall, the other thing is that we continue in the MID area, we continue to introduce some new products of the back pads, foam tapes, shock pads, I should say that are used now, because the gasketing around the displays has been removed, that gives us some opportunity there as well. Daniel Moore – CJS Securities, Inc.: And is the margin profile for those growth opportunities comparable to where maybe you lost a little bit of content?

Well, what I would say is, in total, as we look at the multiple market areas, we believe that there is substantial opportunity in those other areas that will over time replace the – some of the MID business that we’ve talked about. So it’s a running activity for us to continue to expand. and I would certainly highlight the consumer areas one that we believe continues to have higher growth than the industrial and mass transit or transportation. Daniel Moore – CJS Securities, Inc.: And lastly, what are we going to do with all this cash? What does the acquisition pipeline look like, and maybe talk about some potential opportunities there?

So while we can’t talk specifics. I will say that we have increased our investments in our skill sets there. we continue to aggressively pursue opportunities. and I’ll frame it out by saying that our strategy is really one of looking at adjacencies and area that are related to our three major business units. So that’s the focus right now. we’re not necessarily looking at the fourth platform, although it’s something came along that we thought make sense and we would consider. but I’d say the majority of our effort is looking at the three business areas where we can continue to expand our presence and expand our strength, both in the technology and market applications areas. And so we do have a lot of cash and one of the considerations that is always before the board has to do with their share buyback, as well as dividend and an asset discussion that we continue to have at the Board. But I will say that we believe we have opportunities for substantial growth in acquisition through acquisition and that’s where our main focus is today. Daniel Moore – CJS Securities, Inc.: Very good. Appreciate it again. Daniel Moore – CJS Securities, Inc.: Okay. Thanks, Dan.

Thank you. There are no further questions at this time. Mr. Hoechner, I’d turn the call back to you.

Thanks, Steve. In closing, I’d like to summarize a few highlights of our call. first, we had a very strong first quarter, building on the moment; we gained in the second half of 2013. We finished the quarter with record-setting sales in our Printed Circuit Materials division, as well as continued double-digit revenue growth in Power Electronics Solutions. The global demand for Internet connectivity automotive safety sensors and clean energy drove much of that growth and we believe that market indicators point to continued growth in these areas. Secondly, we continue to improve our margins based on the streamlining efforts we began in 2012 and which continue today in the form of operational excellence initiatives. Lastly, we believe our focus on innovation leadership for both the near and long terms will help us build value for our customers and share holders. We expect to expand our market share by taking an outside-in approach to understand and converting customer and market opportunities. We believe our recent performance signifies the new day at Rodgers, together with strong market indicators we feel we have a sustainable advantage in the marketplace and that we are well positioned for growth throughout 2014 and beyond. Thanks for joining us on our call today. Have a good day.

This concludes today’s conference call. You may now disconnect.