STRATTEC SECURITY CORPORATION

to the StratTech Security Corporation first quarter fiscal year 2025 financial results. At this time, all participants are in a listen-only mode. A question and answer session will follow a formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Deborah Pawlowski, Investor Relations. Please go ahead.

Thank you, and good morning, everyone. We greatly appreciate your joining us for the Strat Tech's first financial results conference call. With me on the call are Jennifer Slater, our President and CEO, and Dennis Bao, our Vice President and Chief Financial Officer. Jennifer and Dennis are going to review our first quarter 2025 financial results and provide an update on the company's priorities. You can find a copy of the press release and the slides accompanying our discussion today on the investor relations section of the company's website at www.stratex.com. If you are reviewing those slides, please turn to slide two for the safe harbor statement. As you are aware, we may make some forward-looking statements on this call during the formal discussion as well as during the Q&A. These statements apply to future events that are subject to risks and uncertainties as well as other factors that could cause actual results to differ materially from what is stated on today's call. These risks and uncertainties and other factors are discussed in the earnings release as well as with other documents filed by the company with Securities and Exchange Commission. You can find these documents on our website or at sec.gov. I want to point out as well that during today's call, we will discuss some non-GAAP financial measures. We believe these will be useful in evaluating our performance. You should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP. We have provided reconciliations of non-GAAP to comparable GAAP measures in the tables accompanying the earnings release and slides. So with that, if you would please turn to slide three, I will turn it over to Jen to begin. Jen?

Thank you, Deb, and welcome, everyone. I'm excited to start hosting these quarterly calls so we can keep our investors up to date on the changes we are making here at Stratec. While still in the early stages, I am encouraged by the efforts of our team as we work to uncover potential operating efficiencies identify an optimal cost structure, and lay the foundation needed to strengthen profitability and drive sustainable growth. We are in the process of doing deep dives across all areas of the business to better understand why we have historically had so much variability in our performance and what systems, tools, and operating model we need to provide more consistent, profitable results. Let me start by reviewing some key highlights of our first quarter results. We generated $11.3 million in cash from operations, a substantial increase from last year, raising our cash balance to $34 million at the end of the quarter. Revenue increased 2.7% year over year. When you exclude the impact of the one-time retroactive pricing from last year's first quarter, net sales increased 9.1%. Growth was primarily driven by ongoing pricing benefits, our solid market position on the F-Series pickups, and some new programs growing through their launch. Our gross margin for the quarter was 13.6%, which had the benefit of ongoing price improvement, as well as more favorable mix. The quarter also benefited from 190 basis points and favorable FX, while last year's first quarter had a 470 basis point benefit related to one-time pricing. These two elements make the year-over-year comparison a little challenging. We are encouraged with our results amid the automotive industry headwinds, which reflect broader macroeconomic conditions. Demand for our products is driven by long cycle sourcing and heavily influenced by the production rates of the automotive industry. We aim to address these headwinds with an improved operating model, innovative products, and winning positions on new platforms. As we look ahead and develop our strategy, we will focus on our future pipeline to increase profitable content on the next generation of platforms. Turning to slide four, as I stated earlier, we are thoughtfully assessing our strategy and the future path of Stratech. As there is much to do to uncover the underlying potential of the organization, we have prioritized our efforts into developing a winning product portfolio driving operational efficiencies, and developing our team and talent base. Let me talk you through the work we are doing in each of these areas. First, on our product portfolio, we are taking a market-driven approach to define our future product roadmap. This starts with an understanding of our addressable markets, given our technologies and products, and how the industry is evolving. We will focus where we can add value to our customers and where we have differentiators to create a defensible position. Once that is defined, we plan to prioritize products and investments based on profitability, returns on investment, and growth. This work will also inform our efforts to drive operational efficiencies. We are evaluating our supply chain, inventory and operational processes, all of which need modernization. Strat Tech has not made much change in how it operates in well over the last decade, and we have the opportunity in front of us to make meaningful change. We are in the early stages of rethinking our operational footprint. This encompasses our capacity utilization, our sourcing and supply chain, and manufacturing footprint for the future. The fundamentals on our business processes, tools, and visibility into the data will help identify opportunities and provide stability in the business performance. I look forward to continuing to provide updates on progress in this area as our assessment evolves and matures. Finally, but as much a priority, we consider our team to be a fundamental strength of Stratec. making talent development and acquisition key to our future success. Starting with accountability and responsibility. By simply providing expectations and holding people accountable to them, we can drive improvement. The reduction in our pre-production tooling balance is a prime example of this at work. Identifying for the team what is key to our financial performance and what is expected of them drives the right behaviors. I am proud of the work the team has done in this area of the business. We also need the right people in the right roles. Today, we announced the appointment of Linda Redman as our Chief People Officer, a new role focused on overseeing talent management and employee engagement for our organization of over 3,300 employees. Linda has been helping us since not long after I joined Stratec, and we are excited that she has accepted a full-time role as we undergo this transformation. Her experience spans people leadership roles across world-class, high-growth, strong operational organizations, and we believe her contributions will be invaluable to our efforts. We also welcome Shea Becker Vardo as our new Chief Commercial Officer. Shea is an accomplished leader with diverse experience driving revenue growth and resolving complex issues across multiple industries. Her knowledge in customer relationship management systems, prescriptive revenue forecasting models, and product portfolio management will fill a vacuum in our current information systems, processes, and deliver bottom line improvements. I am thrilled to have these accomplished women join our team on November 11, 2024. We have a lot of work in front of us, and as I mentioned, we will be providing progress updates as we advance our transformation. We will establish milestones for you to measure our progress as we define them and share a vision of our future as our strategy is developed. Let me now shift gears to slide five so we can focus on our sales in the quarter. Total net sales for the first quarter reached $139.1 million, an increase of $3.6 million, or 2.7%. Last year's first quarter had the benefit of price of $8 million in one-time retroactive pricing. Excluding this pricing impact, underlying sales rose by $11.6 million, or 9.1%. The improvement in sales was primarily due to the effects of $2.2 million in ongoing price increases and customer demand for existing products, new offerings, and content on new platforms. Notably, we experienced increased sales of our Power Door products to Hyundai Kia, which we believe was demand driven by inventory stocking to meet their production build rate. We had a 19% increase in sales to Ford attributed to new latch content on all F-Series pickups. From a product perspective, growth is primarily in power access, door handles, and latches. We continue to see a decline in sales of legacy keys and lock sets during the quarter. We are, however, investing in new technology, including a digital key fob that integrates this technology with your phone. I would like to now hand it over to Dennis, who will continue to discuss our financial results in the quarter.