Kimball Electronics, Inc.

Good morning, ladies and gentlemen, and welcome to Kimball Electronics' fourth quarter fiscal 2026 earnings conference call. My name is Sherry, and I will be the facilitator for today's call. All lines have been placed in a listen-only mode to prevent any background noise. After the completion of the leadership team, there will be a question and answer period. To ask a question, simply press star and the number one on your telephone keypad. Today's call, August 13, 2026, is being recorded. A replay of the call will be available on the Investor Relations page of Kimbell Electronics' website. At this time, I would like to turn the call over to Andy Regrut, Vice President, Investor Relations, Strategic Development, and Treasurer. Mr. Regrut, you may begin.

Thank you, and good morning, everyone. Welcome to our fourth quarter conference call. With me here today is Rick Phillips, our Chief Executive Officer, and Jana Croom, Chief Financial Officer. We issued a press release yesterday afternoon with our results for the fourth quarter and full fiscal year into June 30, 2026. To accompany today's call, a presentation has been posted to the Investor Relations page on our company website. Before we get started, I'd like to remind you that we will be making forward-looking statements that involve risk and uncertainty and are subject to our safe harbor provisions as stated in our press release and SEC filings, and that actual results can differ materially from the forward-looking statements. Our commentary today will be focused on adjusted non-GAAP results. Reconciliations of GAAP to non-GAAP amounts are available in our press release. This morning, Rick will start the call with a few opening comments. Jana will review the financial results for the quarter and guidance for fiscal 2027, and Rick will complete our prepared remarks before taking your questions. I'll now turn the call over to Rick.

Thank you, Andy, and good morning, everyone. I'm proud of our results in the fourth quarter and very good finish to fiscal 2026. Sales in Q4 were in line with expectations, adjusted operating income was better than estimates, and we generated strong cash from operations, which was used to pay down debt to its lowest level in over four years. Our balance sheet continued to strengthen and we are actively leveraging it to make strategic investments in growth in the medical CDMO space, such as the build out of our new medical facility in Indianapolis and the acquisition of Hellboy Polymer Technologies. Our guidance for fiscal 2027 is highlighted by organic sales growth and the accretive impact from Helbowit. We are expecting Medical to continue to outpace the other two verticals and represent more than one-third of total company sales in the fiscal year, which is in line with our objective to balance the portfolio across the markets we serve. Turning now to the fourth quarter, net sales for the company were $372 million, a 2% decline compared to Q4 last year, but a 5% sequential increase all three vertical markets posting gains over Q3. Geographically, sales in the fourth quarter were more evenly distributed around the world versus prior periods, with approximately 40% in North America and 30% in both Asia and Europe. Once again this quarter, our medical business was the headliner, growing both year over year and sequentially, and completing a fiscal year where the growth occurred in all four quarters and the total exceeded 10% versus a normalized fiscal 25 when adjusting for the consigned inventory sale last year. In Q4, medical sales were $109 million, a 1% increase compared to the same period a year ago and 29% of the total company. Approximately 30% of these sales occurred in both Asia and Europe with the same year-over-year increases in each region. North America was down mid-single digits, which is below our run rate for most of the fiscal year. This apparent slowdown in the growth trajectory is more of a function of the comparison from a year ago than production this year. In the fourth quarter of fiscal 25, we were supporting our customers with inventory builds for facility closures and transfers of work. Both were one-time events. From a product category perspective, the growth was driven by demand for surgical devices, In Vitro Diagnostics, Patient Monitoring, and Drug Delivery. Next is Automotive, with net sales in Q4 of $170 million, down 3% compared to the same period last year, and 46% of the total. Our business in the fourth quarter was roughly divided a third, a third, and a third between North America, Asia, and Europe, with Poland and Romania reporting mid-single-digit increases as a result of new steering and braking programs. China was up low single digits and North America was down, driven largely by lower EV demand, offsetting these increases. Steering programs continue to be the largest concentration of work, accounting for approximately 70% of total automotive sales for us. For the full year, our automotive business was down 7% year-over-year, So successive 3% declines in the back half of fiscal 26 suggest a stabilizing trend in this vertical. Finally, sales in industrial totaled $93 million, a 5% decrease compared to Q4 last year, and 25% of the total company. Once again this quarter, our industrial business was heavily concentrated in North America, where the majority of the decline occurred from lower demand for HVAC systems. This was partially offset by higher sales of smart meters in Europe, which continue to recover from prior year declines. I'll now turn the call over to Jana for more detail on our financial results and guidance for fiscal 2027. Jana?