L.B. Foster Company

Good day and thank you for standing by. Welcome to the fourth quarter 2025 LB Foster earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Lisa Durante. Please go ahead, ma'am.

Thank you, operator. Good morning, everyone, and welcome to LB Foster's fourth quarter of 2025 earnings call. My name is Lisa Durante, the company's director of financial reporting and investor relations. Our president and CEO, John Castle, and our chief financial officer, Bill Tallman, will be presenting our fourth quarter operating results, market outlook, and business developments this morning. We'll start the call with John providing his perspective on the company's fourth quarter and full year 2025 performance. Bill will then review the company's fourth quarter financial results. John will discuss perspectives on market developments and company outlook in his closing comments. He'll then open up the session for questions. Today's slide presentation, along with our earnings release and financial disclosures, were posted on our website this morning and can be accessed on our investor relations page at lbfoster.com. Our comments this morning will follow the slides in the earnings presentation. Some statements we are making are forward-looking and represent our current view of our markets and business today. These forward-looking statements reflect our opinions only as of the date of this presentation, and we undertake no obligation to revise or publicly release the results of any revisions to these statements in light of new information, except as required by securities laws. For more detailed risks, uncertainties, and assumptions relating to our forward-looking statements, please see the disclosures in our earnings release and presentation. We will also discuss non-GAAP financial metrics and encourage you to carefully read our disclosures and reconciliation tables provided within today's earnings release and presentation as you consider these metrics. So with that, let me turn the call over to John.

Thanks, Lisa. Hello, everybody. Thank you for joining us today for our fourth quarter earnings call. I'll begin my comments on slide five, covering the highlights of the quarter. During last year's quarter reporting cycle, we indicated that our increased backlog should deliver a strong fourth quarter. And I'm pleased to report we wrapped up 2025 with exceptional sales growth, robust profitability expansion, and strong cash generation. Truly a fantastic finish to the year. Net sales of $160.4 million were up 25.1% over last year. This was the highest fourth quarter sales since 2018. Both segments delivered significant sales growth in Q4, with rail up 23.7% and infrastructure up 27.3%. Gross profit was up 10.6%, while gross margins of 19.7% were down 260 basis points due to weaker rail margins primarily related to our TS&S business in the UK, coupled with greater volume of rail products. We delivered strong leverage of SG&A expenses, which were down 1.3 million, or 5.2%, from last year's quarter. The Q4 SG&A percentage of sales improved 470 basis points to 14.4%. Adjusted EBITDA of 13.7 million was up a remarkable 6.4 million, or 89%, with the increased gross profit and lower SG&A expenses delivering the improvement versus last year. In line with our seasonal working capital cycle, we also delivered a strong quarter of cash generation, with operating cash totaling $22.2 million. Cash was deployed with capital expenditures at $2.4 million. Stock repurchases came in at $3.3 million and further reduction in net debt of $16.9 million to end the quarter's balance at $38.4 million. As a result of lower debt levels and improved profitability, our gross leverage ratio improved to 1.0 times, down from 1.6 times at the start of the quarter and 1.2 times last year. I'll now turn to slide six to cover some of the key highlights of the 2025 full-year results. Sales of 540 million were up 1.7%, with the full-year growth achieved as a result of a strong fourth quarter. Infrastructure delivered a strong year, with sales up 14.9%. However, rail sales were down 6.5% due to DOGE-related U.S. government funding impact. at the start of 2025, and we continued our proactive scale-down measures with our business in the UK. Adjusted EBITDA of $39.1 million was up $5.5 million over last year, and substantially lower SG&A expenses, partially offset by slightly lower adjusted margins. Operating cash flow also improved in 2025, falling $35.6 million and up $13 million over last year. We deployed this cash to fund $10.4 million in CapEx, reduce net debt $6.1 million, and fund $14.4 million in stock repurchases under our stock buyback program, which reduced our outstanding shares 5.4% in 2025. New orders net a $540.9 million, we're up 6.8% year-over-year, and overall backlog increased 1.8%, to $189.3 million. with substantial improvements realized across our rail business. I'm very proud of what our team has accomplished in 2025, especially the strong finish in the fourth quarter. Their disciplined execution of strategic playbook continues to manifest in improving profitability and returns, and it's positioned as well for expected growth in 2026 and beyond. I'll now turn it over to Bill to cover the financial details for the quarter and year. I'll come back in the end with closing comments on our markets and outlook for 2025. Over to you, Bill.