Financial Data and Key Metrics Changes - The company reported a revenue growth of 3% in the quarter, but a decline of 0.2% on a constant currency basis [35] - Adjusted EBITDA was a loss of $3,600,000, which is consistent with the previous quarter's guidance [35] - Gross margin expanded by 330 basis points year-over-year to 32.5%, marking the best quarterly results as a public company [35][36] Business Line Data and Key Metrics Changes - The Europe and International segment grew volume by 9.4%, indicating that the growth playbook is effective [39] - North America experienced a revenue decline of 6.8%, primarily due to changes in sourcing strategy and the largest customer [39] - Greater China saw a constant currency revenue decline of 6.6%, reflecting a challenging macro environment [39] Market Data and Key Metrics Changes - The foodservice side of the Greater China business grew revenue by 12% in the first half of the year [33] - In Europe, the company achieved strong volume-led double-digit revenue growth, with EBITDA margins improving to over 20% in Q2 [15] Company Strategy and Development Direction - The company is focused on three priority areas: reducing costs, igniting top-line momentum, and driving profitability [7] - A strategic review of the Greater China business has been initiated to accelerate growth and maximize value [6][12] - The company plans to continue executing its growth playbook, particularly in North America, despite current challenges [30] Management's Comments on Operating Environment and Future Outlook - Management acknowledged slower-than-expected progress in North America and a soft macro environment in Greater China [6] - The company remains confident in its growth playbook and expects to see improvements in the second half of the year [43] - Management emphasized the importance of taste as a barrier to consumption and plans to enhance product offerings accordingly [62] Other Important Information - The company has identified additional SG&A savings, primarily from corporate expenses, to drive efficiencies without harming the business [66][68] - The cash outflow of $5,000,000 in Q2 was the best quarterly performance as a public company, indicating progress in cash management [41] Q&A Session Summary Question: Why is now the right time for the strategic review of China? - Management believes the business is now leaner and stronger, making it a good time to evaluate how to accelerate growth and maximize value [48][49] Question: What is the optimal outcome of the strategic review? - The company is considering a range of options, including a potential carve-out, but will not speculate on the ultimate outcome at this time [49] Question: What are the challenges in North America, and how can they be turned around? - Management noted that while the market is soft, there are early signs of improvement, and they are confident that strategies successful in Europe can be applied in North America [53][55] Question: How are the incremental SG&A savings derived? - Most savings will come from corporate expenses, focusing on efficiency without hurting the business [66][68]

Nasdaq:ERII Charting our way forward Presenting our vision and financial framework for continued success November 2024 Welcome! Agenda and Introduction Lionel McBee Director, Investor Relations 2 2 Agenda today David Moon CEO Rodney Clemente SVP, Water Ricardo Freitas VP & GM, CO2 Michael Mancini CFO Our growth vision, executable path forward, and key enablers to ensure success Our approach for fortifying share and profitability in desalination and driving focused growth in wastewater Building from summer t ...