Perma-Fix Environmental Services, Inc.

Good morning and welcome to the Permafix Fiscal Second Quarter 2025 earnings conference call. At this time all participants have been placed on the listen-only mode and the floor will be open for questions following the presentation. If anyone should require operator assistance during this conference, please press star zero on your phone keypad. Please note this conference is being recorded. I will now turn the conference over to your host David Waldman, of Crescendo Communications. David, the floor is yours.

Thank you Jenny and good morning everyone. Welcome to Permafix Environmental Services Second Quarter 2025 conference call. On the call with us this morning are Mark Duff, President and CEO, Dr. Luz Sannafani, Executive Vice President of Strategic Initiatives, and Ben Nakarado, Chief Financial Officer. The company issued a press release this morning containing Second Quarter 2025 financial results, which is also posted on the company's website. If you have any questions after the call or would like any additional information about the company, please contact Crescendo Communications at -671-1020. I'd also like to remind everyone that certain statements contained within the conference call may be deemed forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and include certain non-GAAP financial measures. All statements on this conference call are then a statement of historical fact or forward-looking statements that are subject to known unknown risks, uncertainties, and other factors which could cause actual results and performance of the company to differ materially from such statements. These risks and uncertainties are detailed in the company's filings with the U.S. Securities and Exchange Commission as well as this morning's press release. The company makes no commitment to disclose any revisions to forward-looking statements or any facts, events, or circumstances after the date hereof that bear upon forward-looking statements. In addition, today's discussion will include references to non-GAAP measures. Permafix believes that such information provides an additional measurement and consistent and performance. A reconciliation of the non-GAAP measures to the most directly comparable GAAP measures is available in today's news release and on our website. I'd now like to turn the call over to Mark Duff. Please go ahead, Mark.

All right. Thank you, David, and good morning, everyone. We delivered a sequential and -over-year revenue growth in the second quarter accompanied by a meaningful improvement in our gross margin. These results reflect continued progress on our operational initiatives, particularly within our treatment segment, where revenue increased approximately 37 percent compared to the same period last year. Even more notable was the fact that our waste receipts more than doubled -over-year to approximately 14 million in Q2 of 25. That said, treatment results were tempered by technical challenges that limited production capacity early in the quarter. These issues have been resolved through automation and process improvements that are already enhancing our throughput, improving safety, and reducing manual labor. We expect to realize the full benefit of these enhancements in the second half of the year. Importantly, we continue to realize state shipments from Hanford in support of the cleanup program as well as the tank management mission, which are estimated to be about $3 million of revenue per month. On a related note, the Department of Energy recently announced a delay in the DF Law Facility startup from August 1st to as late as October 15th. Despite the short-term delay, that program represents substantial new revenue streams for us. We remain encouraged by the long-term outlook for DF Law and the substantial reoccurring revenue and cash flow is expected to contribute once operational. In our services segment, project delays occurred earlier in the quarter, largely due to the federal government and federal procurement timing impacting our results. However, field execution and cleanup and remediation work is now tracking on schedule across key DOE and DOD sites. We're also pleased to report that our team was awarded a position on the Navy's $240 million RADMAC III IDIQ contract during the quarter. This award enforces our core competencies and radiological cleanup and positions us for a steady stream of potential task or opportunities in the coming quarters. We've also entered the six-month period, a planning period for the West Valley project as part of the BDUXT-led team where we expect to play a key role in long-term DOE cleanup efforts. While revenue recognition will be tied to DOE's approval of our final performance strategy, expected later this year, we view this as a significant multi-year opportunity for our services business. Returning now to PFAS, we made strong progress this quarter on multiple fronts. We expanded demonstration activities with both Fortune 500 companies and larger government agencies. In -to-date PFAS-related sales have reached approximately 500k, representing about 30,000 gallons of material so far. Daily operations have resumed at our PermaFAS unit in Florida, and construction is underway on our Gen 2 system in Oak Ridge, which is designed to support up to 3000 gallons of production per day while reducing unit operating costs. The Gen 2 system will also provide the potential to support mobile field deployment options for use in landfills, waste treatment plants, and remote sites. We continue to be encouraged by the technology's destruction performance and its scalability and the ability to reduce liability for our customers at a competitive price point. Internationally, we've received over 7 million waste receipts during the past two quarters and continue to see strong interest from customers in Canada, Germany, Mexico, and Italy. Our 50 million euro contract with the European Union and Italy is progressing through the permitting and preparation phase, and we remain on track to initiate treatment operations in 2026. Across the organization, we remain focused on discipline cost management and targeted margin improvement initiatives, which have continued to be implemented throughout Q3 as well. These programs are already contributing to improved productivity and are expected to support stronger EBITDA performance in the second half. In addition to our revenue generating activities, we're pursuing several large-scale federal and commercial procurement opportunities, including bids with the U.S. Army Corps of Engineers and DOE National Laboratories. Combining these opportunities represent more than $200 million in potential contract value with award decisions expected during the first half of 2026. Company-wide, our waste backlog currently stands at approximately 13.2 million, providing strong visibility into the second half of treatment volumes and services activities. We're also encouraged by evolving PFAS policy and regulatory developments in both the federal and the state levels, which continue to support demand for comprehensive destructive technologies like ours. With growing treatment volumes, renewed activity in our services segment, and commercial traction in PFAS, along with a healthy pipeline of domestic and international opportunities, we believe Permifix is well positioned to deliver improved financial results in the second half of 2025 and build long-term momentum heading into 2026. With that, I'll now turn over the call to Ben Nacarato to walk through our financial results in more detail.