DMC Global Inc.

Greetings. Welcome to the DMC Global Second Quarter Earnings Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to Geoff High, VP of Investor Relations at DMC Global. Thank you, Geoff. You may begin.

Hello and welcome to DMC's second quarter conference call. Presenting today are President and CEO Jim O'Leary and Chief Financial Officer Eric Walter. I'd like to remind everyone that matters discussed during this call may include forward-looking statements that are based on our estimates, projections and assumptions as of today's date and are subject to risks and uncertainties that are disclosed in our filings with the SEC. Our business is subject to certain risks that could cause actual results to differ materially from those anticipated in our forward-looking statements. DMC assumes no obligation to update forward-looking statements that become untrue because of subsequent events. Today's earnings release and a related presentation on our second quarter performance are available on the investors page of our website located at dmcglobal.com. A webcast replay of today's presentation will be available at our website shortly after the conclusion of this call. And with that, I'll now turn the call over to Jim O'Leary. Jim?

Thanks, Geoff, and thanks to everyone for joining us today. Despite continued headwinds in each of our end markets, Many of the initiatives discussed in previous calls have been successful, notably at Arcadia. As a result, second quarter consolidated sales of $157 million were at the high end of our forecasted range, while adjusted EBITDA attributable to DMC of $10.7 million exceeded the high end of our range. Arcadia's second quarter sales increased 9% year over year and 19% sequentially marking its strongest quarterly sales performance since the second quarter of 2024 and the best EBITDA performance in over a year. These results were delivered despite a still horrible commercial construction market. The American Institute of Architects reported last week that its architectural billings index has now gone 41 consecutive months without a majority of the firms reporting billings growth. This is the longest downturn in the more than 30-year history of the ABI. While demand for large, longer-term construction projects remains highly challenged, Arcadia saw improved turnover for its core short-cycle products across its regional service center network, as well as for high-end residential windows and doors. The stronger performance reflects the efforts of Arcadia's management team to improve product availability and service. longstanding hallmarks of Arcadia's business model. Additionally, efforts to right-size our residential products offerings and refocus on attainable targets contributed significantly to Arcadia's improved performance. Sales at Dyna Energetics, our energy products business, were flat year over year, but increased 13% sequentially. Demand was steady, but unfavorable mix, increased input costs, and Price Pressure on profitability. Dyna Energetics recently completed its first shipment of a new perforating system developed specifically for use in enhanced geothermal systems. EGS is emerging as a potentially significant source of baseload electricity and could represent a meaningful opportunity for Dyna Energetics. At Nobleclad, our composite metals business, Second quarter sales were down 17% year-over-year due primarily to lower activity in the global oil and gas market. Sales were up 15% sequentially as a result of increased deliveries on a large petrochemical order. Nobleclad continues to maintain a healthy backlog with increased shipments from that backlog, including order deliveries delayed by customers, should drive stronger results during the second half of the year. I'll now turn it over to Eric for a closer look at our second quarter, our guidance for the third quarter, and some important color on our capital structure as we're on the altar of the potential put-call exercise.