Argan, Inc.

Good evening, ladies and gentlemen, and welcome to the Argon Inc. Earnings Conference call for the first quarter of fiscal year 2027, ended April 30, 2026. This call is being recorded. All participants have been placed on a listen-only mode. Following management's remarks, the call will be opened for questions. There is a slide presentation that accompanies today's remarks, which can be accessed via the webcast. At this time, it is my pleasure to turn the floor over to your host for today, Jennifer Belladeau of IMS Investor Relations. Please go ahead, ma'am.

Thank you. Good evening, and welcome to our conference call to discuss Argan's results for the first quarter of fiscal 2027 and in April 30, 2026. On the call today, we have David Watson, Chief Executive Officer, and Josh Bakker, Chief Financial Officer. I will take a moment to read the safe harbor statements. Statements made during this conference call and presented in the presentation that are not based on historical facts are forward-looking statements. Such statements include, but are not limited to, projections or statements of future goals and targets regarding the company's revenues and profits. These statements are subject to known and unknown factors and risks. The company's actual results, performance, or achievements may differ materially from those expressed or implied by these forward-looking statements. And some of the factors and risks that could cause or contribute to such material differences have been described in this afternoon's press release and in Argan's filings with the U.S. Securities and Exchange Commission. These statements are based on information and understandings that are believed to be accurate as of today, and we do not undertake any duty to update such forward-looking statements. Earlier this afternoon, the company issued a press release announcing the first quarter fiscal 2027 financial results and filed its corresponding Form 10-Q report with the Securities and Exchange Commission. With that out of the way, I'll turn the call over to David Watson, CEO of Argan. Please go ahead, David.

Thanks, Jennifer, and thank you, everyone, for joining today. I'll start by reviewing some highlights of our operations and activities, and Josh Bacher, our CFO, will go over our financial results. Then we'll open up the call for Q&A. Our strong first quarter fiscal 2027 results reflect exceptional execution across our business, with all three of our operating segments achieving significant revenue growth and maintained healthy backlog. First quarter highlights included record revenue of $291 million, improved gross margins of 21%, increased net income of $46 million, or $3.24 per diluted share, and improved adjusted EBITDA of $56.4 million. During the quarter, as expected, we saw significant revenue growth in our power segment, driven by the continued ramp-up of construction activities on our most recently awarded projects. Additionally, we reached substantial completion ahead of schedule at the third and final project of the Midwest Solar and Battery Projects, and we reached final completion on the 915-megawatt Trumbull Energy Center in Ohio. Our balance sheet remained strong, and we generated substantial cash flow in the first quarter. At April 30, 2026, we had $974 million of cash and investments, net liquidity of $421 million, and no debt. Our commitment to returning capital to shareholders is a priority as demonstrated by our quarterly dividend of 50 cents per share, or $2 per share on an annual basis. We have an active and opportunistic buyback program in place, which we increased during the first quarter to $200 million from $150 million, while also extending the program's expiration date through January 31, 2030. Backlog of $2.8 billion decreased slightly from $2.9 billion at the end of the last quarter, As we've noted before, backlog can move around from quarter to quarter as projects are completed. While we are always pursuing new opportunities, there will at times be a gap between the completion of one job and the announcement of new jobs. Our project pipeline remains robust, and we continue to see heightened demand for our capabilities and expertise as the industry urgently seeks to build energy infrastructure in an environment where power demand is growing exponentially and a generation of power facilities reaches the end of useful life. As I discussed on our last call, we expect to add a handful of new projects over the next 10 to 18 months. With teams we have in place and the cadence of our projects, we believe we are well positioned to execute on 10 to 12 jobs simultaneously. Now on to the operational review. As most of you already know, we have three reportable business segments. Our power segment builds all types of power facilities, including thermal, and a variety of renewable, including solar, solar with battery energy, storage systems, biofuel, and biomass facilities. Power segment revenues contributed $227 million, or 78% of total revenues, in the first quarter of 2027. Pre-taxbook income was $52 million, and the power segment had backlog of $2.5 billion at the close of the first quarter. The industrial segment provides field services supporting new plant construction, in additions for industrial facilities and fabricates metal components like piping systems and pressure vessels in its fabrication facility. Revenue increased to $58 million and contributed 20% of consolidated revenues with pre-tax book income of approximately $5 million. Backlog for the industrial segment was $225 million at April 30, 2026. Finally, revenue in our teledata segment was $6 million in the first quarter of fiscal 2027 and contributed 2% consolidated revenue. The segment exited the first quarter with backlog of $8 million. Teladata provides project management and construction services across power distribution and information, communications, and data networks for commercial and industrial customers. The segment works with data centers as well as with federal government locations and military installations requiring high-level security clearance. Our consolidated project backlog consists of fully committed projects across our power, industrial, and teledata segments in total 2.8 billion at April 30, 2026. Demand for our capabilities across all three operating segments is high, particularly in our power segment where our current backlog includes four gas-fired power plants in the United States totaling over 4.1 gigawatts. Our industrial segment is also experiencing increased demand highlighted by a data center contract we were awarded in November of 2025 for the fabrication of thermal expansion and energy storage tanks. In support of this project and to better position the company to address new opportunities, we have begun construction on an additional fabrication facility in North Carolina, which we expect to complete later this year. The electrification of the economy, including the onshoring of domestic manufacturing, the use of EVs, and the proliferation of data centers, is creating urgent demand for additional energy infrastructure to support a power grid that is under tremendous pressure. Gas-fired plants remain the ideal solution for delivering reliable, uninterrupted power, and only a limited number of firms, including Argan, are able to successfully execute these complex projects. The robust demand environment, coupled with our proven track record, allows us a disciplined approach in choosing the right projects in the right locations with the right partners. Our backlog is currently composed of approximately 79% natural gas projects, 13% renewable, and 8% industrial. With the current demand for natural gas-fired facilities, we expect these complex combined cycle projects will represent the majority of our backlog for the near and midterms. Renewable resources still play a valuable role as a power resource, and while demand for these has softened, we subscribe to an all-of-the-above approach when it comes to power generation. With that in mind, we plan to maintain renewable capabilities so that we remain competitively positioned to meet market demand and the needs of our customers going forward. Slide 7 highlights the selection of major projects currently underway or recently awarded. As you know, we reached substantial completion on our 950 megawatt Trumbull Energy Center project in December 2025, ahead of schedule, and the project has now reached final completion. Additionally, during the first quarter, we reached substantial completion, also ahead of schedule, on the final project of our three-part Midwest solar and battery projects. Our projects are complex in nature, and our ability to reach early completion milestones is a testament to our project management capabilities and delivering excellent execution. In Texas, our 1.2 gigawatt ultra-efficient combined cycle natural gas fire plant for SLEC is progressing well, and we're beginning to see construction ramp at our two other gas fire projects in Texas, the 1.4 gigawatt project with CPV and our 860 megawatt project. We are also moving forward, as expected, on our 700 megawatt combined cycle natural gas fire power plant in the U.S. Looking internationally, we continue to make good progress on the Tarbert Next Generation Power Station, a 300-megawatt biofuel plant for SSE thermal, and on a 170-megawatt thermal facility, both of which are in Ireland. As I mentioned earlier, our industrial segment has a 125 million data center project underway and is working on a recycling and water treatment plant in Alabama. While the scope, scale, and complexity of our projects is diverse, Each of our segments share a commitment to execution excellence throughout every project we undertake. With that, I'll turn the call over to Josh Bacher to take us through the first quarter of 2027 financials. Go ahead, Josh.