Good morning, and welcome to the First Quarter 2012 Results Conference Call. At this time, all participants are in a listen-only mode. After the presentation, the company will conduct a question-and-answer session. Today’s conference is also being recorded. If you have any objections you may disconnect at this time. Before the conference call begins, please remember that the company will be discussing some issues that are historical, and some issues that are forward looking. When the company speaks about future results or events, there are a variety of factors that may materially change the actual results from those projected. A list of relevant factors may be found in the earnings press release, as well as in the company’s 2011 10-K filed with the SEC on March 15, 2012. The company undertakes no obligation to update any forward-looking statements, whether a result of new information, future events or otherwise. Additionally, the company may discuss EBITDA. EBITDA is not a measure of performance under Generally Accepted Accounting Principles, and is considered a non-GAAP financial measure as defined by the SEC. The company may present EBITDA, because management believes that EBITDA could be useful to investors as an indication of their ability to incur and service debt, and because EBITDA is a measure used under their credit facility to determine whether they may incur additional debt under such facility. For a reconciliation from income before income taxes to EBITDA, please refer to the company’s current report on Form 10-Q, furnished to the SEC on November 9, 2011. Now the meeting will be turned over to Mr. Edward F. Crawford, Chairman and Chief Executive Officer. Gentleman, you may begin.

Good morning, ladies and gentlemen, to the first 2012 conference call of Park-Ohio. We will be beginning with addressing our first quarter financial results and operations. May I introduce first, Matthew Crawford, President and COO of the company. Sitting on my left, we have Pat Fogarty, who is a 17-year veteran of Park-Ohio, who is serving currently as Interim Chief -- CFO. Matthew.

Thank you very much. We are pleased with the acceleration of our business throughout the beginning of 2012. Revenue increased 9% from 2011, with particular strength in supply technologies in the Manufactured Products segment. Earnings per share was $0.74 versus $0.73 last year. This improvement is understated relative to the current performance given the now fully taxed nature of our earnings. As articulated in the earnings release, a fully taxed comparable EPS for 2011 would have been $0.58. This 28% increase in EPS, we believe, is indicative of the earning power of the company. EBITDA also expanded 14%, to almost $24 million. The big news for the first quarter was the acquisition of FRS. We’re excited about the addition of the FRS team and believe that FRS has added an independent platform for growth, given the strong management team and significant organic and strategic opportunities. Additionally, we are executing an integration plan, which we believe will provide near-term revenue synergies and opportunities. Now let us look more closely at the first quarter business segment results. In Supply Technologies, revenue increased 9% compared to the same period in 2011, and 13% sequentially above the fourth quarter. Very strong demand in the Truck, Electrical, Recreational Equipment and Auto markets combined with ongoing penetration into the Consumer Electronics market led the way. Our initiatives to grow our support to our customers in key overseas markets also continues successfully. Operating profit grew to 10 points, or about $10 million, an increase of 17% from 2011. This also represents a multi-year high in the supply-technologies segment operating profit. These earnings represent a 7.5% margin, which was achieved based on a good product and customer mix, combined with focused expense management. We expect supply technologies to continue to have a strong performance in 2012. Now looking at Aluminum Products and FRS, revenue was $36 million, which included a stronger performance from OEM auto build rates. The second quarter of 2012 will be the beginning of the aforementioned product launches, which will benefit the top line meaningfully as we get into 2013. Operating profit was $1.1 million. Looking at Manufactured Products, revenue improved 17% supported by strong demand throughout the segment. Our Industrial Equipment business continues to benefit from strong backlog built throughout 2011. The Equipment group also saw increased orders in the first quarter, which were 19% greater than the first quarter of last year. Aftermarket revenue also continues to be strong. Our Forge division continues to see strong performance, led by the Rail industry. Operating profit also achieved a multi-year high, benefiting from significant operational leverage, as well as improvement in efficiencies in our Forge and Rubber groups, based on our investment in manufacturing and employee-training processes. While the first quarter was an excellent quarter in this segment, we believe the fundamentals are in place for continued improvement through 2012. CapEx was $2.8 million for the quarter. We expect CapEx still to be approximately $15 million, but recognize we are seeing significant growth opportunities throughout the company. Cash flow for the quarter was a positive $14 million, adjusted for the acquisition of FRS. In closing, the momentum in our business appears to be very good and largely broad based, which allowed us to exceed our internal plan for the first quarter. With this in mind we believe we will likely exceed our prior revenue forecast and are also increasing our earnings per share forecast to $3.10 to $3.20. Thank you.

Thank you, Matthew. I'd like to open up the lines now for any questions.

[Operator instructions] The first question comes from the line of Michael Corelli.

Just a couple of questions. First FRS, I know it closed pretty late in the quarter, and I know this may not be something you want to do on a regular basis, but could you just give us an idea of what kind of revenue and what kind of operating income impact it had in that short bit that it was in the quarter?

It really wasn’t material on either category, so late in the first quarter.

Okay. I mean, I am assuming it didn’t have any positive operating contribution. I know there is purchase accounting and all that stuff, so that the fact that you returned to profitability in the Aluminum Products was driven by its core business and not anything to do with the acquisition.

Yes.

And so as far as the Aluminum Products is concerned, do we expect to see an improving trend kind of gradually going forward, or will there be some fits and starts related to different programs and things like that?

Well, we are at what I call the wall, or the turn. Finally, we are in the process of in the first and second quarter of this year going into the $90 million-plus in new orders written in the last 12 months, $90 million across our platform. So we have come through this storm, in my opinion, and the Aluminum business, as I have been talking about for a year, is more painful to take it along or to get to the turn. But we are in very, very good shape. So I think starting as discussed before, in the third quarter, or if not sooner, the new business is ramping up. We’re beginning to ship as we speak. So you are going to see some important changes in that sooner rather than later. In fact, we are little bit ahead on the turn than we expected.

Okay.

Yes, I think the Aluminum business or that whole particular segment should look stronger each quarter for some time.

And that is exclusive of FRS, you are speaking of, right?

Yes.

Okay. And then as far as the Supply Tech and the Manufactured Products, is there anything you are seeing today that would make you cautious that this great momentum would not continue?

This is Matt Crawford. Now, I will refer to my comments, to my prepared comments. Now, the Supply Tech looks pretty good. I mean, it is -- the revenue improvements have been broad based, come from a number of different sectors. Most end markets have improved year-over-year. So while we are seeing an excellent customer mix, with some of our largest customers really providing some of the biggest lift, it is not an isolated driver. So we feel pretty good in Supply Tech about that, and have some confidence that it is going to continue to perform. In the Manufactured Products segment, the 2 biggest businesses are, first being our Industrial Equipment business. As I mentioned in my comments, really we are seeing at the revenue line some of that backlog that was built through 2011, and yet we continue to build on that with a superior bookings period in the first quarter of this year. So, that is probably for that segment the single biggest indicator going forward. So that bodes well for the rest of 2012. Our Forge group focused mostly on Aerospace, but then also largely on Rail, both Locomotive and Car, is doing very well, not only in terms of the revenue line, but also it has benefited at that margin line from not only operating leverage, but also from some investments that we made in some new equipment. And we have also employed some new lean remanufacturing techniques that have paid off as well. So we’re feeling pretty good about both those segments right now.

All right. Then just lastly about the CFO position, is -- I know Patrick is the interim CFO, is that -- is he possibly going to become the permanent CEO, or is there a search ongoing? Is there any kind of a target time period for naming a CFO?

Sure. I will take that one as well. So, we are fortunate to have someone of Pat’s caliber able to step in here, so we don’t miss a beat. Pat, as I think you know, has been enormously helpful in the really strategic part of the business, both from aiding and assisting the organic growth of the business but also from an acquisition perspective. He has demonstrated an interest, and we have an interest in seeing him continue in that role. But having him here has allowed us someone who's intimately familiar with our business, as well as in his background at Ernst & Young as a CPA and an auditor, really allows us to run a very patient process and find who we think is a great fit for the culture of our business. So, it is our intention to find a good long-term fit, but we certainly appreciate Pat offering to do it in the meantime.

Your next question comes from the line of Richard Paget [ph].

So, real quick you kind of touched on this a little bit, but just wanted to ask a little more, the manufacturing products, you really had great performance there. Just want to see if there is anything unusual in the quarter, any pull-throughs, any shipments that may have happened this quarter, anything that would maybe give you a little bit of a boost in the quarter?

This is Ed Crawford. What is great about this particular segment, and looks bright for the future, is we continue to have not only new equipment sales, but our -- as we have always talked about, are the tail of the parts and service that follows this business is extremely strong. Many companies have laid off and laid off in a 2- or 3-year period in rebuilding or committing their Capex in maintenance to their equipment. And they are sensing a possible increase in volume. So it drives that part, and that part looks very strong for a considerable period of time as people begin to feel that, particularly North America, it is going to ramp up.

I would add, this is Matt, I would add only one other thing, there is no particular segment we have that is vulnerable or more volatile in margins than this group. Fortunately, it comes from a very high base, principally because the aftermarket business is – it's as been described. But the reality of it is, is every quarter has significant equipment orders that come through that can impact the margin in a very positive way, or perhaps even as a slightly lower margin mix. So while we feel very good about the direction this business is in from a booking standpoint and from a revenue standpoint, we are -- also recognize that this margin can jump around a little bit based on orders that flow through.

Right, got you. Sounds good and then on Supply Tech again, as you mentioned, a multi-year high there for margins. On a long-term basis what's kind of the potential there? Do you see going forward a continued trajectory going up or kind of what do you see there?

This is Matt again. I would tell you that this isn’t a really good margin quarter. Our goals exceed the 7.5% margin. But having said that, we saw really robust activity at some key customers that provided the real operating leverage. So some stars aligned here to hit that margin. But that doesn’t mean that that is not achievable, or that even higher than that is not. But, there were some stars that aligned in the quarter, not in an unusual way, but just in sort of the right customer mix at the right time. Also I would draw your attention to the fact that the first quarter does have the greatest number of ship days as well. So it provides us an opportunity to leverage some of the overheads slightly better than in some of the other quarters.

Got you, and then on the account adds, is anything in the quarter with that or anything that you can talk about with us on your international expansion objectives?

Yes, we are still early in that process. I mean, as you know, we’re -- we do a significant amount of supply technology business overseas. We’re really, what I would call, in the transition period from simply taking business that our U.S.-based customers want to give us in those foreign operations and building an infrastructure both from a physical footprint standpoint, and a people perspective to attack those markets. So our wins so far in those markets, as being more locally oriented, have been minor at this point. But we’re certainly investing the money to build a platform for success in the future. So, nothing I would bring to your attention right now.

[Operator instructions] Your next question comes from the line of John Baum [ph].

Let us see, I got a housekeeping question here, and then a little broader-based question, I will throw to Eddie, I guess. So, housekeeping, I know you are looking to fully taxed earnings this quarter, but I know there was a little bit of net operating loss and other credit carry-forwards that was in the K. Do you have a figure as far as for federal income taxes when they become fully taxable on a cash basis, not a GAAP basis, for this year?

John, this is Patrick Fogarty. We're estimating right now that the NOLs would be used up sometime in the third and fourth quarter, and then are estimating our cash taxes paid to be about $12 million for the year.

About $12 million for the year. Excellent. Okay, Eddie, I'm often referring to long-term shareholders as like a 12-piston engine, when all the pistons start firing together, but it seems like they are doing right now, it is going to be a heck of a run. When you look at Auto, when you look at Industrial right now in your key areas, there's Aluminum Products as well as Supply Technologies, any idea how long this run could go in terms of Auto, is the sector still pretty positive right here taking off, especially for Aluminum Products? And maybe you could touch a little bit about what you are seeing in Europe.

Okay. Let me address Europe first. We have been very close in looking at Europe, particularly from the Supply Technology business, and we have gone soft on that for the last 6 months. We don’t want to really get mixed up on what is going to happen over there. So, we slowed down our engines a little bit relative to taking Supply Tech, or Oscar [ph], to Europe. And from an international viewpoint, there is a lot to be seen over a considerable period of time. So that is one, that is where we look at Europe today, although we have a lot of very good business there, particularly in Germany, in the aftermarket in service and parts of our Manufactured Products unit. So right now virtually all of our real concentration in Europe is in Germany. So that is where we want to be, and, of course, where we have Belgium, where we have our pipe machinery company. As far as the outlook, we’re pleased about the Auto industry and the number of cars. I am more excited about the fact that, as we were hoping, the number of qualified competitors for the supply base has dwindled, and the most, I think, strongest thing happening on the Aluminum side is that we have actually taken a knuckle away from a Korean company that was an ARM, and is now as part of the portfolio of $90 million is now going to be manufactured in the U.S. in Aluminum. So there are some good things happening there. But the one thing I will take this opportunity -- I want to clear up the vision for this FRS. Don’t be looking at FRS as just an Automobile play. Don’t think of it just as in the Automobile segment. You have to think of the following: We see we bought it, obviously, and we think at a very desirable number, but the potential here as how it will affect our other divisions is very important. There is -- the product lines in the products they make currently, FRS, will have an impact and are affordable from the standpoint they can be sold to some of our current customers in Supply Tech fields. This is a very important consideration. It should be able -- we should be able to grow the FRS Supply Tech side of this business, new product that we will manufacture over in FRS. Secondly, it also helps with the fact that the major customers over there are the Big 3, are the auto companies, are the Toyotas, and enhancing our relationship with them at the level we are talking about will be positive. And then, of course, our Rubber business. So, FRS, we are very optimistic, not only the product lines that exist in the past history, it is how we can affect some of our internal divisions. That, we did not pay anything for. That, we got for free. And when you think back of the 5.5 months it took us to make that transaction, it was about evaluating -- it is clear it came with great management and they are still there. They are running the company. But the opportunity is not only in growing that organically, more important, we have spent the first 90 days of that being part of the stable in trying to determine how this would and how it could impact the rest of the company. So the name FRS should not be thought of strictly as an Auto play, as products they can bring and enhance 2 of our 3 major divisions. So we think this whole area, we are comfortable with it. It has been a long, difficult turn. But we are there and I see a lot of positive long- and short-term effects of this acquisition on the company.

You have a follow up question from the line of Michael Corelli.

Just -- a number question. Now with the acquisition of FRS, could you give me some guidance how we should look at depreciation and amortization for this year?

Sure. This is Pat Fogarty again. Our current run rate relative to depreciation and amortization without FRS is about $14 million. We expect that at the current year, the FRS amortizable goodwill and fixed asset depreciation will about $3 million. So we are looking at about a $17 million depreciation and amortization amount this year.

So, FRS is basically adding $1 million a quarter?

For this year, correct.

There are no further questions.

Well, thank you very much, and we had a good start, and we look forward to speaking to you at the end of this quarter with some optimistic views of the balance of the year. Thank you and have a nice day.

Thank you for participating in today’s conference call. You may now disconnect.