Westport Fuel Systems Inc

Thank you for standing by and welcome to the Westport Fuel Systems second quarter 2025 conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you'll need to press star 11 on your telephone. If your question has been answered and you'd like to remove yourself from the queue, simply press star 11 again. As a reminder, today's program is being recorded. And now I'd like to introduce your host for today's program, Ashley Newell, Vice President of Investor Relations. Please go ahead.

Good morning, everyone. Welcome to Westport Fuel Systems' conference call regarding its second quarter 2025 financial and operating results. This call is being held to coincide with the press release containing Westport's financial results that were issued yesterday after markets closed. On today's call, speaking on behalf of Westport is Chief Executive Officer and Director Dan Zelay and Chief Financial Officer Bill Larkin. Attendance on this call is open to the public, but questions will be restricted to the investment community. You are reminded that certain statements made on this conference call and our responses to certain questions may constitute forward-looking statements within the meaning of the U.S. and applicable Canadian securities law. And as such, forward-looking statements are made based on our current expectations and involve certain risks and certain uncertainties. With that, I'll turn the call over to you, Dan.

Thank you, Ashley, and good morning, everyone. We continue to make meaningful progress in transforming Westport and sharpening our strategic focus to achieve that transition. In Q2 2025, our efforts translated into measurable results. Reported revenue was $12.5 million for the quarter as compared to $14.1 million in the same quarter of the prior year. Consolidated revenue, including the light duty segment, which was reported as discontinued operations during the quarter, totaled $88.8 million as compared to $83.4 million in the same period of 2024. In addition, Suspiria generated $12 million in revenue during the quarter. Finally, following quarter end, we made significant progress in advancing our strategic transformation this quarter, culminating in the recent successful divestiture of our light duty segment. This transaction strengthens our balance sheet and sharpens our strategic focus on high impact opportunities in commercial transportation and industrial applications. With the successful completion of the sale of the light duty segment, Westport is taking the necessary steps to execute on a new focused and integrated business strategy. What sets Westport apart is our ability to deliver performance, cost efficiency and environmental benefits together. Our company is well positioned with fuel agnostic technologies that are already available in the market and designed to evolve alongside the industry's transition. Our solutions allow customers to adopt net zero and low carbon fuels today with a cost effective pathway to hydrogen adoption as its availability increases. In the short term, RNG represents a significant opportunity to reduce emissions in heavy duty and off-road applications. We're actively pursuing multiple growth opportunities that are economically compelling right now. In addition, our IP portfolio is expected to provide a competitive advantage well into the future. The company recognizes the evolving macroeconomic environment and is positioning to capitalize on renewed market momentum, especially as it relates to the use of natural gas as a transport fuel. Moving forward, Westport will be focused on the following key drivers. Suspira, with its strategic market expansion and technology leadership in heavy-duty transportation. Our high-pressure controls and systems, which complement the energy transition regardless of the powertrain, and a variety of financial initiatives. The company's goal for the Suspiria business is to deliver demonstrated volume growth over the coming 12 months with a backdrop of renewed industry focus on CNG, LNG and RNG for heavy duty transportation and favorable and more stable CNG, LNG and RNG fuel pricing economics. Westport is also aiming to increase the OEM presence and related new market activity for Suspiria. The opportunity for Suspiria increases significantly through geographic expansion. In North America, CNG remains a dominant choice for fleets seeking lower operating costs and reduced emissions. Actively looking to expand presence in these regions, we continue to drive innovation through the testing of a CNG HPDI solution. With our high pressure controls and systems business, we are developing high pressure components that are critical to performance and reliability. As a reminder, we are selling into three primary markets, China, Europe, and North America. Currently, China accounts for over 50% of Westport's revenue in this segment, almost exclusively focused on hydrogen component sales. Supported by multi-layered government support spanning from comprehensive national strategies to targeted regional incentives, funding mechanisms, infrastructure mandates, and industry collaboration, the Chinese hydrogen market is anticipated to continue to drive growth for Westport. To drive success in this market, we are opening a state-of-the-art hydrogen innovation center and manufacturing facility in China in late 2025. This pioneering facility will serve as a hub for research, development and collaboration to meet the increasing demand for hydrogen transportation solutions in the region. The new facility enables us to better serve local customers and partners, driving clean energy advancements in one of the world's largest economies. Excitingly, As part of Westport's global restructuring, the company is relocating its European high pressure controls and systems manufacturing operations to our existing technology center in Canada, aligning the manufacturing facility with our innovation hub in North America. This move enables flexibility in product design, increased speed to market, and bolsters our commitment to delivering top tier clean transportation solutions to global markets while also assessing potential expansion of CNG and RNG systems, creating incremental growth avenues that allow us to strategically refocus on the North American transportation market, where the near-term focus has shifted away from hydrogen. Our key focus going forward recognizes both the opportunities and challenges in overall market conditions. We have already begun a strong internal process to review additional ways to maximize our economic benefit from this recent transaction for our stakeholders. Our mission is to focus on growth and improving financial results along with capturing market share. Our overall drive for market expansion and move towards generating positive cash flow may not be the smoothest path, but we believe we are uniquely positioned to take advantage of a more pragmatic moment globally where governments, commercial transport companies, and industrial power providers require more affordable solutions than those that exist today. That said, in the near term, Suspiria will continue to require cash contributions from its owners. As a technology and innovation company connecting synergistic technologies to power a cleaner tomorrow, we are offering our customers the best value of ownership and environmental performance as they continue to prioritize the total equation. The heavy-duty truck market is growing globally and natural gas is experiencing a revival driven by affordability, abundant infrastructure and growing production. In Europe, LNG and RNG adoption for trucking is rebounding sharply, with LNG emerging as the preferred fuel due to its decarbonization potential and superior fuel economy. In North America, CNG and RNG are gaining momentum as fleet operators encounter rising skepticism around electrification, citing much higher than expected energy costs and persistent hydrogen distribution challenges. At the same time, key regulations are shifting. For example, California has paused or rolled back mandates like advanced clean fleets, signaling greater flexibility for alternative fuels. CNG in particular is emerging as a reliable and cost-effective solution, offering fleets a stable and scalable pathway forward. Suspear's flagship LNG HPDI technology continues to gain strong traction, particularly in Europe. although we are also seeing fleets adopt the technology in India, South America, Africa and East Asia. With approximately 9,000 trucks currently on the road, the platform delivered an impressive 25% year-over-year growth in 2024. The latest iteration, featured in the new 500-horsepower Volvo FH AeroCab, achieves fuel economy of 10 miles per gallon on diesel, far surpassing traditional spark-ignited competitors that typically operate in the six miles per gallon range. This performance gap is cementing HPDI's reputation as the high efficiency choice for long-haul transport applications. I will now hand the call over to Bill so he can provide some more information on the financial results.