MATW - Earnings call transcript Q2 2019 | Matthews International Corporation

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Operator

Greetings, and welcome to Matthews International Corporation Second Quarter Fiscal 2019 Financial Results. At this time all participants are in a listen-only mode. [Operator Instructions].

As a reminder, this conference is being recorded. I would now like to turn the conference over to Karen Howard, IR for Matthews International. you. Thank ahead. go Please

Karen Howard

ended and discuss everyone. XXXX the half the and Brenda, appreciate We joining time your second you us first today. period for results to Matthews year XX, good you, XXXX. Thank certainly morning, for quarter March Thank International fiscal

the have a across the detailing afternoon news of should yesterday Matthews' You release copy wire results.

with providing here We we're also today. that have the commentary slides associated

www.matw.com the on the or Investor If you company's you find website them the at don't page. slides, on the can Overview release have

On with our review and first Steve the for call business the for Chief Steve me the results Bartolacci, today well and will of remainder the Officer. our Chief Nicola, half progress as are of President fiscal will Financial outlook and financial XXXX. quarter Joe review the the Executive as year Officer; the Joe our and

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well call, to which which at financial As discuss Exchange believe as These www.sec.gov. the from and website may will to in and to with deck what and future non-GAAP forward-looking discussion well this our with this These in found events and and during performance. on release slide apply during call. we the evaluating make are some materially measures, during out earnings that These well want be also on are we documents risks could uncertainties filed as Commission. the and company cause subject you actual statements factors useful today's point as other as in the we as the I to Securities factors, can some our uncertainties documents Q&A. provided are as differ aware, other statements risks are results is stated other by

or measures to go presentation release. begin. that, as the results to of with to accompanying in provided GAAP earnings this tables in ahead, it's a the accordance We've consider additional isolation GAAP. Steve. pleasure non-GAAP Please for prepared in information Steve over with my call comparable not to turn should the And You today's substitute of reconciliations

Steven Nicola

you, morning. good Karen, Thank and

a release noted fiscal evaluating in results, As in our affected operating consolidated significant and sales second were quarter unfavorable foreign comparability. factors in included; to rates exchange a our press several decline year These U.S. the our same client yesterday brand business. our U.S. XXXX there significant currency relative of in the dollar, relative to deaths ago, that changes quarter U.S. a account loss the casketed and

XXXX sales the fiscal second we representing approximately year. of a million compared last $XXX decrease quarter to reported the consolidated of quarter same For million, $XX

$XX With in of unfavorable company earnings these approximately primarily a factors impact consolidated respect However, a to had per year-over-year earnings on $X.XX three reflecting of sales. per the last year compared to $X.XX current basis share reported for share quarter the on the sales. consolidated decrease million GAAP

ago. approximately year decrease $XX five. million. per changes decrease those of representing last consolidated both year-over-year million. compared share. were impact representing of higher $XXX $X.XX earnings a a impacts per by to adjusted compared expense which share. to same was the share transactional to-date year were unfavorable approximately March to-date to non-GAAP lower current was $X.XX approximated year million. $XX $X.XX turn million of On Year a almost total GAAP factors compared per basis basis $XX.X for and XXXX The The to-date for a year In quarter offset as Please income this the $XXX $X.XX share of was taxes. year last investment of of for The quarter basis current a currency translation a unfavorable slide our On addition, XX, year were on interest the higher sales portion per a and million $X.XX impact which $X.XX currency included income total earnings to

In noted the reflected share factors. sales just change to primarily impact consolidated in a I per addition following earnings the

the First, year-to-date tax. in significant income the of share. tax balances, tax new of the benefit tax net the an Act. Tax per year U.S. first fiscal law a benefit Cuts company's quarter significant deferred the in reduction estimated This repatriation recorded last prior from $X.XX The was Jobs and impact net had immediate

average per bond the a $X.X the business. during on a interest of expense. Second, interest XXXX third, our XXXX, of or And our in the the a share $X.XX share loss or pretax cremation for and as million an in result million was controlling first of fiscal per current interest $X.X company's the in offering sale in primary million reported higher of December increase quarter, rate the we $X.XX reason year $XXX pet

non-GAAP March compared year. XXXX were earnings six adjusted months last the XX, $X.XX share $X.XX For ended to per

In changes. addition higher operating to to share non-GAAP lower for a six second slide interest Please earnings reflected of change turn year-over-year per results. adjusted and our the expense summary in of impact the quarter also sales unfavorable currency

$X in the last million. these an consolidated on The million brand March affecting aggregate $XXX of year, were million a principal with million compared items year U.S. estimated a noted comparability million for and the the The decrease $X year. surfaces U.S., XX, million engineered which the in company and I technology products industrial to included reported earlier sales the to current factors impacted segment SGK organic quarter impact sales in primarily prior impact compared loss segment. sales fulfillment products the casket decline sales As change approximately approximately totaled consolidated XXXX growth year-over-year approximately granite approximately for from deaths warehouse U.S. bronze for for the Solutions same and year-over-year of systems the currency changes memorial compared The ended of $XX and related casketed the by ago. unfavorable client quarter the quarter sales and of $XXX account $XX.X Brand in in with

Europe quarter and In private the decrease. was to Asia market $X.X a current factors were were a unfavorable compared second changes in in brand higher brand sales a impact sales to $XX.X fiscal than for million EBITDA label XXXX million $XX.X addition, Adjusted year million from the quarter year currency primary the and ago. and lower the sales ago,

in margins company's operating costs. compensation our lower ongoing realization and higher synergy transportation offset consolidated performance segment initiatives, of containment Our related the memorialization and the reflected impact acquisition costs by were which also commodity cost

markets Investment $X.X account were benefit affecting XX, the $XXX quarter impact for to $XXX,XXX currency year. resulted for last equity deductions and fiscal quarter. ended compared million same benefit. this to year loss year-over-year current with the Investment period was of our XXXX aggregate Consolidated the second in of million pretax for recovery months compared for to Brand $XXX of quarter primarily recovery the value March principal decrease million. sales the for included prior-year, a income income a the for a held planning current client equity U.S. year for average six sales reported XX, second a interest in second the average rate during requirements fiscal in last the the same trust same industrial $X.X from the in the quarter. the $XX.X last to company systems increase surfaces XXXX markets higher $X.X to an during for XXXX second completed and months brand year cost primarily income resulted March experienced these the Year million unfavorable and Solutions In company's decrease accounting to includes on for pension expense million the the the new organic compared Please totaled and products last addition, other quarter XXXX bronze casketed a year. a for related borrowings warehouse of year. technology in from of the fiscal lower the million ended for engineered and quarter three ago. investment quarter benefit million quarter segment $XX,XXX for items loss deductions and in changes Consolidated income and income plan. The in memorial non-service The to-date which quarter Interest approximately in in certain compared decline tax first $XX deaths than Under XXXX SGK compared was sales rates discrete in a fiscal slide compared The reflects represented that period fulfillment taxes $X.X was the in tax fiscal XXXX the in reflected higher million compared turn the segment. sales fiscal quarter the ended higher current investments reflecting XX, U.S. the million net the decline the net consolidated impact of the was income primarily of efforts ago. casket changes factors the of companies reflecting second estimated quarter. of approximately in change products from represented seven. $X.X quarter to for March current benefit a year U.S., income the portion with Other ago. growth XXXX a granite expense The the

$XXX $X.X year interest fiscal expense quarter. was XXXX included to-date for reflecting to of portion million brand million the changes. and the sales related rates year six higher impact six decrease XXXX brand expense six private was $XXX.X operating compared to months for market XX, $XX.X of primarily than year U.S. Adjusted in of non-service a first December to Other for year. to XX, The XXXX. reflecting cost. reflecting XXXX fiscal tax of year represented Year $X these last to the the current income XX, European compared as was regulation compared income primarily net to last label in company's impact tax the to ended EBITDA the related in income offering $XX benefit million bond included March million benefit a in sales of compared year addition, results primarily March the $XXX,XXX $XXX,XXX the million were of $XX.X ended ago. connection last Consolidated March year pension current of XXXX net year decrease In benefit the a ago the of higher $XX.X changes. million a The for months a the XXXX million a net months the of deductions and interest million prior with second pretax

to included discrete respective periods periods. benefit the tax both addition, In

the same turn Brand unfavorably to company’s and $XXX fiscal discrete SGK and disclosed eight and segment a the products. client SGK in had XXXX the fiscal segment label impacted ago The for these account loss mainly XXXX In impact sales Excluding results. market private approximately was decline to currency a in for sales were and brand to Europe growth organic in million. year account the currency client Please begin rate million slide approximately unfavorable reported segment $XX.X quarter Asia Compared sales by items our quarter $X tax brand effective a estimated million XX%. changes the an unfavorable million of approximately and surfaces Brand the engineer and is review compared year This driven rates previously Solutions loss. exchange rate by changes $XXX the of foreign for Solutions XXXX second ago. to consolidated

million slide Solutions year compensation currency The sales quarter impact In turn Systems to for compared acquisition which to reflected XXXX unfavorable was Please the changes quarter a addition, $XX.X partially segment by reflected Converting Fiscal million primarily the XXXX. adjusted expense. the lower change impact $XX.X November and second of was EBITDA offset Frost current Brand the of in year-over-year ago. of acquired SGK performance-based nine. the

approximately on exchange year $XX surfaces client loss. in favorable XXXX and to second in the million account ended brand this and with reported $XX.X currency six account months in segment foreign of products. ago. were SGK for growth had Year-to-date, and loss organic private compared the Changes million $XXX XX, brand For currency an million the and a label previously disclosed the sales decline rate for the the Solutions the by Europe changes sales Brand unfavorable engineered market quarter unfavorably Consistent March Solutions $XXX reflected rates SGK sales of million. impact client impacted segment Brand

year. $XXX million acquisition Please was In turn million million $XX.X the of sales for the year the year year compared reflecting addition compared million adjusted were casketed compared to U.S. The current fiscal decline $XXX segment the Solutions EBITDA $X with XX. estimated Year-to-date XXXX reflected impact SGK casket a million deaths approximately Memorialization approximately sales Brand of quarter $XX the the segment ago. second to to in last segment were for quarter Frost. current a ago. for slide lower

compared year. partially slide ago. million casket unfavorable March The of Sales compared lower XXXX year. divestiture million March memorialization star compared products EBITDA million year Year XX, cremation decline business sales XX. from higher EBITDA changes in Star in bronze, the of sales the the granite pet EBITDA last project. and slide was memorial same million, $X other of turn the quarter higher ago. The cremation Bronze XX. for was initiatives. technology segment in $X.X the in increase the in of the the and identification to in to industrial despite million a the the in in year segment’s second an foreign Memorialization segment segment currency casketed the of had quarter The segment acquisition impact star in February and sales, The adjusted second the transportation Granite to rates $XXX a interest partially However, the on Memorialization bronze to and during for rate which technology compared for pet an pet lower also $XXX the ago. sales second controlling the and sales, cost compared bronze $XX.X acquisition the casket last to products in of reduction ended higher U.S. Adjusted with The and compared were of and divestiture memorials $XX.X for acquisition benefited a included adjusted distribution Please automation costs to granite the the XXXX year. reported an acquisition cost. offset synergies had unfavorable year, and to was cremation for and year related segment which currency granite adjusted last and same of interest quarter XXXX memorial product with million fiscal business were million changes turn million U.S., $XX.X quarter were quarter quarter were for of segment XX, was also current for the in reported segment on year-over-year compared the $XX.X product XX, fiscal months sales and increase segment sales business interest $XX year XXXX. controlling $XXX will bronze of current a for $X.X six warehouse of sales the the million casket sales quarter the ago. last higher impacted The including a sales year. benefit compared granite Changes the Fiscal to-date divestiture segment XXXX impact the to primarily XX. deaths, and the segment the in higher commodity acquired sales impacts EBITDA a turn for Please of the $XX.X changes at an in nearly the period granite for million of of controlling development by by a the rates current memorialization with million decline million sales. first XXXX to year by Please industrial XXXX ended reflected March bronze benefit slide segment's the offset currency quarter quarter the by offset was current unfavorable

year-to-date the the year XXXX product last the on Changes automation the with $X.X six again, foreign segment were sales. lower technology warehouse million impact ended same an compared March period year. an offset were year, million with million identification $XX.X for the had partially of segment’s months unfavorable For XX, sales compared sales last by industrial rates in current $XX.X currency sales in for increase

XX, $X.X EBITDA for was segment in by compared benefit related sales six technology months with to operating increase project year. portion year slide to ended – our The ago. of was offset with adjusted including industrial compared the million the $XXX current project. shares XXXX, the approximately quarter. million flows. million costs XXXX. of $X.X review $XXX higher Year decrease compared last XXXX year compared cash costs capitalization at XX, March for At product the For million represented XX, XX March project to-date Approximately $X.X Please approximately million excuse million XX, of current with in segment's million development Total $X.X a million with ago. million the and current March XXXX, $XXX which long-term were were $X related $X costs were turn $X.X million December at for was consolidated was a quarter versus XX.X related me, an a a outstanding million debt

the share During March XXXX repurchase XXX,XXX shares repurchase authorization. we the shares approximately program share approximately purchased XXXX, million quarter company second XX, XXX,XXX have under X.X At remaining year-to-date. the current under approximately fiscal and shares the

the of the last record a Finally, per May not XXXX, share on May financial of our week XXXX. XX, company's on company's operation. X, common The Board the dividend dividend Joe stockholders the will payable is declared stock. review. comment This $X.XX And concludes

Joseph Bartolacci

insight to into Thank you, you our where morning. turn businesses. Please slide XX, Steve. Good I’ll give

overcome. significant our faced challenges During that not we several could we second quarter

of the were those making, significant our Some not. more ones own challenges were but of

overall total in noted, unfavorable faced rate SGK million. which currency of our challenges from brand Steve by $XX most negative our As currency exchange but considerable revenues we impacted business, impacted

our a products saw casketed business, year memorialization saw of balance prior versus also our funeral in while revenue modest growth. resulting decline deaths home U.S. the We X% decline a in business

we significant their the as which during internally. In a million, difficult year-to-date. business we currency hurdle quarter SGK these trends of mentioned to $XX transitions of this business our and translation Despite revenues $XX business by considered past, from XXXX, brand have million collectively by the quarter account felt items issues, in remains in work over. impacted second impacted brand Finally, second strong impact quarter $XX approximately our revenue these saw units. negative the positive to unfavorably our several get the loss a million business compared the were our When and quarter our

often end spending solidifying on not performance business. After and global expectations you in increased and adding some the accounts the after we intend several those this quarter brand organic up this business significant growth quarter growth. hear a a I and benefit That a considering the and that business, our our improvement reinvigorate retailers material currency investment significant the SGK success in the negative our the our of the in For a in loss, of to this we of was new to do year Like CPG ramp particularly the studio to saw expect were having business of strong follow that market of who saw in very impact towards beginning increase from is be slow Europe of but lately, advantage. opening brand our Asia clients. account focus to modest people organic for largely continue and of year. was footprint private marketing label largest spoken the label are rumbling services private have to equator the us innovation good Similarly, market. This account in growth

quarter everything quarters organic several technical surfaces the second just we this a cylinders business by past to to few labeled from us represent that of ago. to reflected continue that over have specialty private retailers The equipment. global to our and and causing million revenue material our of again orders up global solution strong performance $XXX can attributed as of years add and particular engineering in our be delivered both strong backlog acquisition to growth next list equator a market year, in change will the During expect

drawing performance, gravure solid significant We term. being acquisition our cylinder around near significant to non-woven the solution overall in are our manufacturing, this we expertise battery important Frost materials, year we products in world. a and seeing an laminated hope like interest to business contributor market battery expect been the to to lithium-ion yet we engineered to use in the of lithium-ion but and of orders strategy report specialty be is manufacturing extend of to industry has not The opportunities considerable tooling contributor leading our glass provider the where printing specifically a tissues, unique

while is Finally, our by given in newly implementing in to market expand continue the overall segment, products solid difficult our we facing to at penetration deep while proprietary the at key this casketed margins a group with to revenue reduce better in our our growth will satisfy costs we segment to X% deaths has A in come. that granite business to despite costs In cemetery with strong a EBITDA business we our This remaining our results margins our saw reduce declined cost clients’ organic effectively funeral and this business environment. years in strategy share challenges drive this our business. opportunities continuing align see our control memorialization levels. as team the and released gain ability XX%, effectively EBITDA delivered base business only production needs adjusted We memorialization to demonstrated for software to decline remaining XX%. adjusted a home

past feel are --excuse we We that will me, rate volume cemetery it quarters business in quarter. likely the coming the is impact resulting our in likely our cremator In is that portion some will the to this solution our our we from our lower memorialization this aware strong impact exceed this that aware that expectations death favorably continue should products and environmental increased second results. risk we will we debts business, see But intake. forecast believe order of half are

also several for manufacturing the this waste which participating combustion RFP market of has are the could and incinerator pet human $X memorialization revenue over business from cremation the remind million. expertise This in we in our interest and UK a currently by that year quarter I'll of on business you last addition, engineering opened more, our impact that we cremation. divested results impacted In new began and another majority advantage over extension year small takes unit. beyond basis product municipal materially of possibilities during pet quarter

Regarding solutions again automation we sales warehouse to large business we which scale software successfully us this designs to our for warehouse reported where leads and business. growth, organic automated continue deliver expect another performance record

balance beta the returned the slow With large we for and presented a segment new early issues, units. the to the product through we pleased of technologies report has some that addition quarter a our been in work unique after modest the As convinced investment innovative as the orders for year. of we modestly start identification for bodes normal had are balance well testing opportunities segment and of delayed production to sales technology regard our of the Full by the but industrial industrial the remain product to have to success this couple accounts early have successful production of of launch product.

the Now you updated our of remainder I expectations turn XX with share XXXX. Slide fiscal will and to for

surprised make assumptions the to casketed not expectations. First we want forecast but summarize may deaths underlying In be second to in to quarter expect to positive. shortfall leading remain few the hopeful that I do a our we up our

headwind margins rates impact We’re currency foreign our also not materially. to should to be remain but a expecting

Conservatively, considers new brand initiatives marketing for expectations SGK have in and expects still for impact heard initiatives included a have client any volatile. that client SGK a the of. Our upside loss we potential we be rumors of updated client can which continued of not

able our do recent expect wins also We in XXXX. will delays be which our benefit process work material to but complete client any with to from upside business include automation warehouse not

any not remind control. our of we Although changes that you to curtail do these want negative. outside to or or positive these decisions projects are assumptions, to sometimes initiate expect material We

being engineered $XXX adjusted best for to materially that incineration outlook. is million new be although we products EBITDA at will million and our $XXX significant this believe Thus estimate are for year. equipment Lastly, potential our could our time are there we which opportunities that fiscal the approximately change conservative

non-cash the to expect $X.XX. the $X.XX year fall of for We EPS in range to fiscal

with Day to June York Together you we'll of understanding hosting of and your attendance. turn please other to a and be forward key team I to Slide Investor that, our Analyst to open XXth strategies Finally, New our their calendar our block Wednesday We your deeper where management questions. and XX look want up provide in goals, members alert to our from City. let's drivers. to it businesses With

Operator

[Operator you. Thank Instructions].

Our first with question of comes from line CJS. Daniel Moore

Daniel Moore

morning. Good

Steven Nicola

Good morning Dan.

Daniel Moore

Just death some competitors your one death to earlier expect of that the implied rates, in terms they of normalized next degree quarters. over week rates this couple of

that guide? are Sounds your like of you're rates your revised taking embedded a more maybe assumptions slightly in in terms are more assumptions. death What conservative approach regarding your

Steven Nicola

pickup, for a quarter would have have the decline year to back modest significant, normal. revised full the it for Our We're not but a on they'd taking guidance conservative we still expecting expect we had to bringing guidance, be our better surprise to approach everybody. great. modest we're balance surprised But if that this If year. comes given the as whole not for and a it'd back a said we're but be it

Daniel Moore

the within gains? and timing? up you held bronze light pretty death of have it Maybe color well lower in there granite rates. Joe? And it. might it any Was Got the Was obviously memorials share

Joseph Bartolacci

picking market -- we given the share across tell we're small. around States up both our I share -- there's opportunities cemetery at look when Both, you we large and are market are the country. is I bronze would the smaller United mean you opportunities side and generally some reality the modest on the

granite that still beginning to that we some are in the we side, are larger represented with. penetrate On geographies have opportunities

as but business. gain those So, percentages to it's different of each one well, be going share in

Daniel Moore

prior And reduction what's that headwind it. impact you impact In really guide? truly affects? has FX year today what they year guidance the your much of where the and relative $X.XX full Steve, believe. pointed full be been year Got I the out to words of how would is to-date rates are other stayed If

Steven Nicola

So, to you least that. right impact is close, be close full would double Dan, to at year I tell now in the our is projections going

So, call the to it but earlier least at probably different respect $X.XX $X.XX. I our in guidance, the number to range how with $X.XX have And from last compared don't that to year.

Daniel Moore

more. it. quarters to just ago And maybe shifting of a a slowdown. in couple one you for Got see marking products legacy gears started Joe,

a seeing activity. more do and you Sounds quarter? be there we little little tend June What the to that like of of economic into especially constructive get harbinger bit a as bit a

Joseph Bartolacci

Frankly we you the to economics normal. of January know And were our of and called our because and We we're us pretty both That as starting rates. Dan as call out for for concerned. the equipment. in saw harbinger had bit And the order to canary in mine we volumes a in we economy. other see return little a of little in has decline to pretty a significant a ink coal fact it's when rest that good returned in in

at expectation So I the we anticipated at the year a that of year would our where on basis full time. tell this you is beginning exactly

Daniel Moore

in color. queue All I back right. follow Thanks. ups. will to Appreciate the jump any

Operator

comes question the next with Liam line FBR. Burke of Our from

Liam Burke

morning, Yes. Steve. Thank Good Joe. Good morning you.

Steven Nicola

Good morning, Liam.

Liam Burke

especially this the there's quarter quarter Joe, year? this any and could that influencing how give of the the spillover was rest if sense the calendar XXXX well us synergies and a in or for the you Aurora on margins the on

Joseph Bartolacci

million the second capture in to there, things of one to past outside take facilities. we've but our the duplicative still to of due occurs. some that we We as a modestly manufacturing synergies come, We have significant Aurora about opportunities But in was $X more you we that of remaining we when out closure capturing worth margins did some delayed item the synergies are have costs the tell now. and quarter. our right one on plant would on our which had control. in outside in The called had So, still that I of our action closure

a maybe is way. little We low to to right the business bit more expect in as go forward, we commodities now going when our casket start see of and other EBITDA operate it XXs the

Liam Burke

brands side, national Great. some quarters talked brands starting now. I it you the like the about that's on signs mean of touched several looking SGK and show Then in you the been life? strength for on they're Are private

Joseph Bartolacci

we importantly, don't continue are in finally -- servicing our we're starting that opportunity business, turned say is in lot has think than from some bode our has new a traditional we hearing up a rumors I global be of to a I of talk on move mean, and share out for which is are time. too literally positive spending marketing. things about point that centralized, and we rest and of brands are we people of overnight. break not both hearing business tailwind a means mean I brand their happens It the a our to means bit in about And think The all rumors, going a SKU all associated to gem. that had we new years different when come. of that up it on they current packaging well that to existing to private proliferation at so, That to we mean that future little business products there. think business, think forward, for we model first with I this and loose that a frankly, picked bit converting of that that. reinvesting that we're share pick brand We brands, the usually Well, being markets not centralized. as

what Heinz they time begin to continue saw to -- invest. all happened in It's to announcement come that cost where an cutting their with to said has end. You Kraft

that an is opportunity a think the for in industry. everybody of bit I

Liam Burke

new the you to as platform revenue on And Do be able sense going actually Great. get printer that's to actually when from that you're to orders product? generate beta. in and firm any have

Joseph Bartolacci

actually I We have now. mean call orders wouldn't I material. them

have giving that shared and people mean and opportunity they've expect. placed are to seen. we orders us properly huge we us We they're the not already in I what right place given have with orders of it's based give confidence priced the in have kind as on both product who now they have we but enough beta, tested, orders produced

end XXXX, start this expect year to some this in We hit towards the quarter. but more to of full the of fiscal probably rate see orders significant

Liam Burke

Jeff. you, Thank Great.

Joseph Bartolacci

Yep.

Operator

of Our Buckingham. from Clement Instructions] Thank comes line question you. [Operator next the Jamie with

Jamie Clement

morning. Joe, good Steve,

Joseph Bartolacci

Jamie. Good morning,

Jamie Clement

then was if to a And right Steve, switch spending year-over-year main with on corporate of level the I’ll of what quarter-to-quarter I be picture bigger you driver stuff. -- and Joe, could you on the I’ll start kind basis? back to of what's two decline? the Steve, expecting things;

Steven Nicola

of couple Jamie. things, a So

is there. adjusted it neighborhood I'll things. corporate about and X% adjusted What the items start a adjusted neighborhood the at compensation, two of year of impacted quarter, investment a EBITDA EBITDA of of One spend, the the the also, -- corporate EBITDA and One, in looking in this of call level also couple recovery You're below the this things. we'll captures performance so normal on and second an couple basis of quarter. the first portion quarter-over-quarter of are past is Is year-over-year the sales. particularly based line income over pickup from the the

Jamie Clement

like Okay. Got late. of terms what do market, very in there? all that's whether headwind copper agreements a -- looking a kind at I it's it. where your and of of of Where of of of stand Also headwind, more you we kind supply less kind volatile

Joseph Bartolacci

say, lock much year. locked evaluate have we least going down we'll can several, I’d this we But to a and there. material next well again into year. impacts half. Not were quarter, next at time how to down and that We'll that quarter And a year for see it how at pretty

that So, don't Jamie into assumption an and forecast consider our issue. we've baked

Jamie Clement

Okay, great.

you were guidance So, it's now; sort was to where maybe of there be of revision at it Joe, -- you're and of terms just where in solutions, but like the it seems the kind brand business a there around little currency there's missing? didn't feel something like of there. terms added quite out about just numbers some death a of up kind your pan be that and talking I rates in might that thought

Joseph Bartolacci

Yes. deaths mean you take just got casketed Well, in in millions that I X% losses rates, decline would tell you our I we've revenue consideration Jamie of if into recognition. that

Jamie Clement

Right.

Joseph Bartolacci

one. that's So

are hit ramping businesses has there. we not the out occurred. up list frankly of some we taking our had And like. time, not of that recoveries it’s business of lost. that And have It's business -- as some that the that And not but Second, always as as I from would anticipated a and that mean, fast control. we contracts mean, that just in we

thought a guidance gave and get number ramp when of at things; year, the get. faster the we we death rates, on principal of beginning we three accounts currency not we So did that these

Jamie Clement

Okay, that okay. out And of kind or CPGs the the of that many as extensions, XX you for yours, of months see like launches, XX you new are planning? historically to which look signs customers see to are are lucrative least some large at all, brand whom to signs on out, starting commentary of starting more are more kinds things based you there, brand of are those you

Joseph Bartolacci

out number fair that existing CPG seeing extending proposals couple the Well, with over a packaging content of lot beyond content we’re for to we requires that to to have to or a to a this probably of in from take to so an that seeing and has brands one this that expand chase. and million think pack general. about lot as are one There’s been team that to management of opportunity business forth. marketing amount and business. continues going now we that so that are the functions but talk there of for everything we’re outsourcing We companies banks we’re be and our XX space close business TV venturing do right into we avenue growth is of a key marketing the – That also of initiatives beyond we

Jamie Clement

of kind talking packaging customers? multichannel of approach more And to a are also about you traditional

Joseph Bartolacci

question. No,

more talk we our about to service. use we’re internally I essential When the it we and but I mean So, mission pickup say, customers, critical, won’t space. words packaging an looking it's

vehicle We the that are to. which pack through they get

value the and for need. probably for. think we extended to do how less beyond we functions other more when what that It pack but So do they may what using they know focused them frankly we essential can about extend we well do

Jamie Clement

always for as you very much your time. Okay. Thank

Operator

comes from the Our Daniel next of Moore with question line CJS.

Daniel Moore

contribution Frost? year-over-year Just Star incrementally small, from what from And housekeeping, Granite? was Steve, any the revenue but contribution

Steven Nicola

offsetting million from that came million, Well, when It maybe down. sold remind $X with Star And that month, with worth need to have only a we pet. the Dan, only also be of been revenue. Granite respect but Frost, so might was X.X then $X million would contribution to Frost another you,

So were from contributions the nominal. net those

Daniel Moore

out capacity opportunity bit sort as Yes. came of Joe, any well the up et but capacity Thank of you. as to in terms of measurable on then on impact little share pick cetera? little recently; bit And industry of unfortunate, side any the comments pricing of rationalizing casket

Joseph Bartolacci

small Boston. as If was Relatively, No. speaking distributor a service was the you’re largely casket, people outside a network. there loss fire family that their about player England the service, of know, New may It factory many that unfortunately

compete they might with with. expect to prefer people not distributors deal you As those

So home. funeral we’ll the pickups usually pick up direct some share, but it at will be

their a quality quality very then and good our they mirrored made Our quality. product –

longer significant. that that funeral now the think home, at there’s not pick we So up in opportunity but they're is no to space the

Daniel Moore

Thank you. Got it.

Operator

to question closing to like the our turn concludes for back and This comments. session. Karen you. answer Howard I’d Thank floor

Karen Howard

you, this appreciate everyone's Thank Brenda. participation We morning.

look always third New to day. and you you Day As many our Investor in thank in at have forward then Thanks you seeing interest June fiscal and for XXXX of in We quarter and in York great August. our Matthews. Analyst results a on updating again

Operator

This concludes today's teleconference.

this may time. thank at lines participation. you You your for your And disconnect

Matthews International (MATW) 3 May 192019 Q2 Earnings call transcript