Fortrea Holdings Inc.

Good day and thank you for standing by. Welcome to the Fort Tria Q3 2025 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 the 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 first speaker today, Tracy Crumie, Fortria's SVP of Investor Relations. Please go ahead.

Thank you. Good morning, everyone, and welcome to Fortria's third quarter 2025 earnings conference call. With me today on the call is Anshul Thakral, Chief Executive Officer, and Jill McConnell, Chief Financial Officer. Before we begin, please note that this call is being webcast. There is an accompanying slide presentation, which can be found on the investor relations section of our website or TRIA.com. During this call, we'll make certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to significant risks and uncertainties that could cause actual results to differ materially from our current expectations. We strongly encourage you to review the report filed with the FCC regarding these risks and uncertainties, in particular, those that are described in the cautionary statement concerning forward-looking statements and risk factors in our press release and presentation that are posted on our website. Please note that any forward-looking statements represent our views as of today, November 5, 2025, and that we assume no obligation to update the forward-looking statements, even if estimates change. During this call, we will also be referring to certain non-GAAP financial measures. These non-GAAP measures are not superior to or a replacement for the comparable GAAP measures, but we believe these measures provide investors with a more complete understanding of results. A reconciliation of such non-GAAP financial measures to the most directly comparable GAAP measures is available in the earnings press release and the earnings call presentation, which is provided in connection with today's call. Lastly, I would like to add that Anshul, Jill, and I will be attending the Citi and Evercore healthcare conferences on December 2nd and 3rd, respectively. If anyone would like to meet with us on these dates, please contact me or a sales representative from the firm. And with that, I'd like to turn the call over to Anshul Thakral, Chief Executive Officer. Anshul, please go ahead.

Thank you, Tracy. Good morning, everyone, and thank you for joining us today. As I mark my first 100 days in this role, I want to begin by expressing my gratitude for the warm welcome and support I have received from colleagues at Fortria, our board, our clients, and our broader community of stakeholders. I'm pleased to share that Fortria delivered solid results in the third quarter in line with our expectations. Revenue for the third quarter was $701.3 million, adjusted EBITDA was $50.7 million, and backlog is over $7.6 billion. Our book-to-bill ratio improved to 1.13 times up sequentially from the second quarter, and our trailing 12-month book-to-bill ratio of 1.07 times remains in line with the CRO sector. These results, combined with the continued strength of our pipeline, position us for continued backlog growth. Overall, we saw demand for our services grow. Our win rates improved significantly, reaching the highest level in six quarters. Specifically with biotech clients, our win rates doubled compared to the prior quarter. Decision-making timelines for biotech clients have continued to improve from a low in the first quarter of 2025. We saw continued strong RFP flow across clinical pharmacology and full-service clinical development and have a robust pipeline that is balanced across biopharma and biotech clients. While we saw a slight increase in our cancellation rate, it remains within our historical range. The overall demand environment is showing signs of improvement, with growth in clinical trial starts so far this year and increased biotech funding in Q3. Biopharma remains resilient and continues to advance its development portfolios, reflecting the underlying strength of the science. Our cash position is robust, bolstered by the receipt of the second and final milestone payment of $25 million from the divestiture of our enabling services business. We continue to focus on debt pay down, including a recent tender offer to repurchase up to $75.7 million of the company's outstanding senior secured notes, funded in part by our improved cash position. These actions underscore our commitment to maintaining a healthy balance sheet and financial flexibility. We also welcomed Bill Charbaugh to our board of directors this quarter. Bill brings a wealth of experience from his long tenure as an executive in clinical development at Bristol Myers Squibb and PPD. I've had the privilege of working with him previously. His insights will be valuable for our board as we execute our strategic plans. Let me provide some details on our new business wins in Q3. We secured several significant awards with new and repeat clients that underscore our differentiated capabilities and strong client relationships. Our clinical pharmacology business continues to grow with robust wins from leading pharma partners as well as biotechs. Average contract size continues to increase consistent with our expertise in managing complex early phase clinical trials. Our portfolio continues to see growth in metabolic disease neurodegenerative disease, immunologic and rheumatologic diseases. We also see growth in studies including patient cohorts, which we are increasingly able to execute internally within our own clinical research units, or what we call our CRUs. This is true for later phase studies as well, where we are able to leverage our CRUs as multipurpose research sites. Our global clinical development business saw diverse awards across multiple therapeutic areas. Our new to Fortria biotech awards in the quarter included a phase two study in a rare neuromuscular disease. We won repeat business from several clients in the quarter. These wins included two phase three ophthalmology studies from a biotech client, a phase three complex respiratory disease study from a mid-sized pharma, and a Phase II oncology study from a large pharma client. In addition, we were delighted to secure two new strategic partnerships with midsize clients. Turning to client and operational highlights, we are pleased to report another sequential improvement in net promoter scores in Q3, reflecting our ongoing focus on client satisfaction and operational excellence. Our NPS improved further year-over-year, supported by measurable delivery achievement, including reducing the time-to-site selection by 33%, accelerating recruitment in a high-priority complex respiratory study by three months, and finishing enrollment five months early in a Phase II Alzheimer's study. This is the execution excellence that drives client trust. With our culture of innovation, we continue to make strides in technology and AI adoption, delivering productivity gains that are expected to improve efficiency, quality, and client delivery. I'll highlight some of the innovations that are part of our Fortran technology strategy focused on digital modernization of our workflow. Earlier this year, we launched Accelerate Risk Radar, including an AI-powered agent designed to enhance risk-based quality management in clinical trials. It uses AI and ML to automate risk identification and suggest mitigation strategies, reducing manual effort and improving efficiency and patient safety. Start My Day is a new digital experience that brings actionable insights and prioritize tasks into a single, intuitive, persona-based interface for CRAs and study teams. This tool is designed to improve daily productivity and decision-making. It's in pilot stage now, with broader deployment planned in 2026. As part of our strategy to modernize CRA workflows, we are broadening the rollout of our ICRA mobile app and digital assistant following successful pilots. We are integrating the app with our accelerated platform to provide smart reminders, digital site check-ins, and risk metrics. Early users report 5% to 10% efficiency gains, which should increase as we add further functionality, tangible proof that our strategy is delivering. These initiatives streamline processes, reduce manual effort, and foster a culture of continuous improvement, positioning Fortria for operational excellence and scalable innovation. Now, I'd like to share more color about our progress on our strategic plans. As I mentioned on our last earnings call, my first 100 days at Fortria were focused on two priorities, deepening client-facing activities and employee engagement. To that end, I traveled extensively across the United States with members of our executive team, as well as to India, China, Japan, the UK, and Bulgaria, meeting with clients and colleagues. These visits included discussions with many of our top clients to strengthen partnerships, as well as joining our sales efforts by attending bid defenses and numerous meetings with biotech executives as part of our new client acquisition actions. Client feedback on Fortria has been overwhelmingly positive. Both large pharma and biotech clients value our global delivery, quality, executive attention, and operational improvements. Biotech clients, in particular, appreciate our balance of scale, agility, and the focus on client intimacy. With that said, we, of course, like all CROs, can continue to get better in project management and overall client relationship management. We held in-person employee town halls across various geographies and offices, engaging with about a third of our workforce. We saw firsthand a hackathon in India, showcasing grassroots innovation from our study team. We are instilling a culture amongst our colleagues to continue to focus on efficiency across all aspects of our workflow. I am proud of our employees' deep experience and their commitment to our mission of bringing life-changing treatments to patients faster. The team moved quickly through our leadership transition without missing a beat, and there is a strong emphasis on employee engagement. They have worked with tireless dedication to serve our clients and position the company for future success. My first 100 days also reaffirmed that our strategy should center around three critical pillars for the business, commercial excellence, operational excellence, and financial excellence. Commercial excellence is how we return to growth, built on the three R's, reach, relevance, and repeat. We must continue to expand our reach by growing our pipeline of new opportunities and acquiring new clients. We must also leverage our recognized therapeutic and scientific expertise in ways that are relevant and resonate with clients, doubling down on areas where we are already strong. Lastly, we're growing our roster of repeat clients through sticky relationships and enhancing our client account and portfolio management capabilities. Operational excellence is how we deliver quality and productivity consistently for our clients. We are optimizing project management, streamlining our structure, and bringing therapeutic experts closer to delivery. We're also enhancing our biotech operating model and empowering our operational teams to accelerate studies with better technology, tools, training, and infrastructure. Financial excellence means continuing to right-size our organization while driving margin expansion. While cost actions have begun to reduce our expense base, we are implementing further targeted initiatives to ensure that these translate into margin improvement in 2026. The ability to tightly match resources to demand must remain in Fortrea's DNA. We continue to optimize our capital structure. We remain focused on positive cash flow and stay committed to keeping our DSOs in the low to mid 40s. We're closely monitoring the pricing environment to battle winning new business and achieving attractive margins amid competitive pressures. I will now turn the call over to Jill for a deeper dive into our financial results.