Phibro Animal Health Corporation

Hello and thank you for standing by. My name is Regina and I will be your conference operator today. At this time, I would like to welcome everyone to the FIRO Animal Health Corporation third quarter 2026 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press star then the number one on your telephone keypad. To withdraw your question, press star one again. I'd now like to turn the conference over to Glenn David, Chief Financial Officer. Please go ahead.

Thank you, Regina. Good day, and welcome to the Fibro Animal Health Corporation earnings call for our fiscal third quarter ended March 31, 2026. My name is Glenn David, and I'm the Chief Financial Officer of Fibro Animal Health Corporation. I am joined on today's call by Jack Bentime, Fibro's Chairman, President, and Chief Executive Officer. Donnie Bentime? Director and Executive Vice President of Corporate Strategy, and as previously announced, our CEO designate, and Larry Miller, Chief Operating Officer. Today, we will cover financial performance for our third quarter and provide updated financial guidance for our fiscal year ending June 30, 2026. At the conclusion of our remarks, we will open the lines for your questions. I would like to remind you that we are providing a simultaneous webcast of this call on our website, pac.com. Also, on the investor section of our website, you will find copies of the earnings press release and quarterly form 10-Q, as well as the transcript and slides discussed and presented on this call. Our remarks today will include forward-looking statements, and actual results could differ materially from those projections. For a list and description of certain factors that could cause results to differ, I refer you to the forward-looking statement section in our earnings press release. Our remarks include in accordance with generally accepted accounting principles for U.S. GAAP. I refer you to the non-GAAP financial information section in our earnings press release for a discussion of these measures. Reconciliations of these non-GAAP financial measures to the most directly comparable U.S. GAAP measures are included in the financial tables that accompany the earnings press release. We present our results on a GAAP basis and on an adjusted basis. Our adjusted results exclude Acquisition-related items, unusual, non-operational, or non-recurring items, including stock-based compensation. Other income expense is separately reported in the consolidated statement of operations, including foreign currency losses gains net. And income tax is related to pre-tax income adjustments and unusual or non-recurring income tax items. Now, let me introduce our Chairman, President, and Chief Executive Officer, Jack Bentine, to share his opening remarks.

Thanks, Glenn, and good morning, everyone. We had a strong third quarter. Net sales increased 10% to $383 million, and adjusted EBITDA increased 11% to $60 million. Animal health sales increased 13%, with solid demand across MFAs, nutritional specialties, and vaccines. This performance is all the more impressive due to a complex, broader protein backdrop. And beef supply remains tight, which continues to support prices, In dairy, we're seeing early signs of stabilization, even as fats have remained under pressure. And while poultry demand is positive, we are managing through elevated geopolitical volatility in the Middle East. Importantly, our diversified portfolio and geographic reach allow us to navigate these different cycles effectively. Since quarter end, there are three updates I want to touch on. First, Brazil and antimicrobials. Brazil has implemented a new regulatory framework that removes gross promotion and performance indications for certain antimicrobials, including regimicin and bacitracin, with a 180-day transition period. We are working closely with regulators and industries to support an orderly transition and maintain continuity for customers. We also engaged with MAPA, the Brazilian regulatory agency, for several years on therapeutic registrations for genomicin in cattle and broilers, and those are in the final stages of review. Glenn will provide some training of the dollar amounts later in this call, but I want to put this in context. This change has been in motion in Brazil for a long time, and what we're seeing now is a culmination of a process that's been underway for years. In many ways, Brazil is catching up to a regulatory approach that's already in place across the other major markets, which is why we view this as the last major shoot to drop in this area, not the start of a new wave of changes. Just as importantly, our history has shown that we emerge from these transitions stronger than when we entered them. Sometimes that's by maintaining demand as products move to therapeutic use, and sometimes it's by winning share with other parts of our broad portfolio. but the content is growth. And as the market moves towards prescription-based use, our FriboVet platform is designed to make compliance easier for veterinarians and producers and to position us as the partner of choice in this new environment. Second, our sustainable solutions platform and Veritain. We launched a new sustainable solutions platform and introduced Veritain, verifying sustainably solutions through our partnership with Vaxxer. The customer need is clear. Many are being asked or will be asked to show progress on supply chain emissions and feeders offer the biggest lever. What matters for adoption is practically solutions and that can scale and fit into existing systems without requiring customers to overhaul their operations. We're still in the early stages of rollout. The scalability of this platform provides a clear path for long-term growth as customers increasingly prioritize credible, high-impact sustainability solutions, and this is something I'm confident you'll be hearing a lot more from Donnie in the years to come. Third, we strengthen liquidity. We upsize our revolving credit facility by $125 million through an oversubscribed process, further enhancing our financial flexibility. Before I turn it back to Glenn, I want to close on a personal note. As previously announced, Donnie will assume the seat of a row in July. Having worked closely with him in our long-term strategy for many years, I have full confidence in his leadership and the depth of our management team. While I'm transitioning to executive chairman, I'm excited about this next chapter and look forward to supporting Donnie and the board as we continue building on the momentum of the business. I also want to thank the analysts and investor community for the engagement and support over the years, the thoughtful questions, and the long-term perspectives. And I want to thank our employees around the world because the performance you see in our results is a product of their work every day. With that, I'll turn it back to Glenn.