STRATTEC SECURITY CORPORATION

Greetings and welcome to the StratTech Security Corporation first quarter fiscal year 2026 financial results conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Deborah Pawlowski, Investor Relations for Stratec. Thank you. You may begin.

Thank you, and good morning, everyone. We greatly appreciate you joining us for Stratec's first quarter fiscal 2026 Financial Results Conference Call. Joining me on the call this morning are Jennifer Slater, President and CEO, and Matthew Pawley, Vice President and Chief Financial Officer. Jen and Matt will review our financial results, the progress being made to transform StratTech, and our outlook. You can find a copy of the news release in the slides that accompany our conversation today on the investor relations section of the company's website. If you are reviewing these slides, please turn to slide two for the safe harbor statement. As you are aware, we may make 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 the Securities and Exchange Commission. You can find these documents on our website as well. I want to also point out that during today's call we will discuss some non-GAAP measures, which we believe 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. With that, let me turn it over to Jim, who will be referencing slides three through five.

Thank you, Deb, and welcome everyone. We started fiscal 2026 in a solid position and our financial results are a direct testament to the actions we have been taking to transform the underlying operations of Stratec to improve our earnings profile. The progress reflects the significant effort by our team and the magnitude of change we have been implementing. Revenue grew nearly 10% in the quarter while gross profit margin expanded 370 basis points and EBITDA margin expanded 310 basis points to 10.2%. Margin improvements are a result of higher sales, pricing actions, and cost reduction activities. We continued to actively manage our cost structure and implemented an additional restructuring action during the quarter that is expected to provide approximately 1 million in annualized savings that will be fully realized in the third quarter of this fiscal year. We also had solid cash generation of $11 million and ended the quarter with just over 90 million of cash on the balance sheet. We believe this provides us the capital to continue to execute on our transformation plans while providing a cushion during these rather turbulent times for the automotive industry. I'll talk more about the short-term automotive industry headwinds that have been layered on top of the impact of tariffs after Matt covers the details of the quarter results.