Clarus Corporation

Good afternoon, everyone, and thank you for participating in today's conference call to discuss Claris Corporation's financial results for the fourth quarter ended December 31st, 2025. Joining us today are Claris Corporation's Executive Chairman, Warren Kanders, CFO Mike Yates, President of Black Diamond Equipment, Neil Fisk, and the company's External Director of Investor Relations, Matt Berkowitz. Following the remarks, we'll open the call for your questions. Before we go further, I'd like to turn the call over to Mr. Berkowitz as he reads the company's safe harbor statement within the meaning of Private Securities Litigation Reform Act of 1995 that provides important cautions regarding forward-looking statements. Matt, please go ahead.

Thank you. Before we begin, I'd like to remind everyone that during today's call, we'll be making several forward-looking statements, and we will make these statements under the safe harbor provisions of the Private Securities Litigation Reform Act. These forward-looking statements reflect our best estimates and assumptions based on our understanding of information known to us today. These forward-looking statements are subject to potential risks and uncertainties that could cause the actual results of operations or financial conditions of Claris Corporation to differ materially from those expressed or implied by the forward-looking statements. More information on potential factors that could affect the company's operating and financial results is included from time to time in the company's public reports filed with the SEC. I'd like to remind everyone this call will be available for replay starting at 7 p.m. Eastern time tonight. A webcast replay will also be available via the link provided in today's press release, as well as on the company's website at clariscorp.com. Now I'd like to turn the call over to CLARIS Executive Chairman, Warren Kanders.

Good afternoon, and thank you for joining CLARIS Earnings Call to review our results for the fourth quarter and full year. I am joined today by our Chief Financial Officer, Mike Yates, who will cover our Q4 results, including adventure segment performance, as well as Neil Fisk, who will discuss our outdoor segment. In 2025, we remain focused on positioning Clarus for sustainable growth over the long term, prioritizing our most profitable products and styles in the outdoor segment and executing incremental operational progress in the adventure segment. Our financial results reflect a challenging market characterized by weaker consumer demand, tariff impact, supply chain disruptions, and broader macro headwinds. As you will hear from Neil, during the fourth quarter, we experienced the most unfavorable seasonal conditions in 50 years in key ski destinations in the United States. Against this backdrop, we continue to advance our overall strategic plan to simplify our businesses to drive share gains as market conditions normalize. Across both segments, we implemented targeting cost outs and tariff countermeasures that will enhance profitability on an annualized basis and set the stage for long-term value creation. At Outdoor, we have fundamentally reshaped the business over the last two years, simplifying the portfolio, exiting low margin categories and rationalizing SKUs, while upgrading leadership and reallocating investment toward higher growth areas. At the same time, we have meaningfully reduced our cost structure, modernized our systems and sourcing capabilities, and expanded product margins by more than 300 basis points before factoring in the impact of tariffs. Together, these actions have positioned the business to operate more efficiently and profitably moving forward. I would also like to highlight the continued success of the Black Diamond apparel line, which saw sales growth of 10% in the fourth quarter despite unusually adverse seasonal conditions in both the U.S., West, and Europe. We see very strong momentum in key businesses unit heading into 2026. Turning to adventure, our results continue to be affected by market pressures. Q4 gross profit was impacted by several one-time and external factors that Mike will discuss in greater detail. While 2025 was a challenging year for the segment, we have taken corrective action to position the business for a stronger, more innovative future. Importantly, as we discussed last quarter, we identified that pricing in several of our markets, particularly Australia, had not kept pace with inflation or our cost base, contributing to margin erosion. And we have moved forward with price increases across all brands and markets, effective Q1 2026. We continue to believe that adventure is only beginning to tap into significant growth opportunities around the world, and we have begun to see green shoots, particularly in Europe and Japan, where the steps we have taken to improve service levels and shorten lead times have helped to accelerate growth and drive new customer wins. Additionally, our commitment to fitting more vehicles led to a record number of new fitments delivered in 2025, strengthening our competitive positioning and supporting future revenue growth. There is certainly more work to be done, but we have been pleased with the continued progress on our strategic initiatives at Adventure. Overall, Aquarius is far better positioned to navigate uncertainty and market weakness than we were a year ago. Supported by a debt-free balance sheet and a streamlined organizational structure, we will continue to advance our multi-year growth plans while maintaining a disciplined approach to capital allocation and a clear focus on maximizing shareholder value. With that, thank you for being with us today, and I will turn the call over to Neil.